'Tis the season to avoid folly

Employers that organize and host Christmas or holiday parties and similar work-related social events have a number of legal responsibilities.

They can be held liable for not taking adequate precautions to protect their employees from foreseeable and preventable harm.

In April 2022, a U.S. employer was charged US$450,000 after throwing a surprise birthday celebration for one of its workers.

After-hours beers

In Jacobsen v. Nike Canada Ltd., [1996] B.C.J. No. 363 (S.C.), the B.C. Supreme Court considered whether Nike Canada was liable for serious injuries which left the plaintiff employee a quadriplegic.

Nike provided the employee and his co-workers with beer during work hours. After work, the employee visited two clubs and drank more beer while in the company of one of his co-workers. When driving home to Port Moody in the early hours of the morning, he drove off the highway into a ditch and was thrown from his car.

The court held that Nike failed to meet the standard of care owed by an employer to its employees. It found that the company made alcohol available at work but did not monitor the employee’s consumption and took no steps at all to ensure he did not drive when impaired:

“Nike required the employees to bring their cars to work and knew they would be driving home. In effect, Nike made drinking and driving part of the working conditions that day. It effectively encouraged the crew to drink without limit by making freely available large amounts of beer in an atmosphere which induced thirst and drinking games. The supervisors, Mr. Agostino and Mr. Prasad, drank along with the crew, and made no attempts to restrict or monitor the amount the plaintiff or any of the other crew members drank. No one told the plaintiff that some of the beer was intended for customers later on the weekend.”

The court found Nike to be 75 per cent liable for the employee’s injuries. The total damages for his injuries exceeded $2.5 million.

Workers’ comp claims

In addition to personal injury litigation, events organized and hosted by employers can also result in workers’ compensation claims. Employers should be aware of such claims because their experience rating and premiums under the applicable workers compensation scheme might be negatively affected.

In a review decision about 12 years ago, Review Reference #R0116672, the Review Division at WorkSafeBC considered whether an employee had a compensable claim flowing out of injuries sustained at a company’s Christmas or holiday party.

There was a slight difference in the account of events of the employer and the employee. There was, however, agreement that a third person at the party caused the employee to stumble on the dance floor. She fell on her right side, hit her head and was knocked unconscious for close to a minute.

The preliminary question for the adjudicator was whether the Christmas or holiday party was sufficiently connected to the employee’s employment to be compensable. According to the adjudicator, participation in a recreational activity, including a party, is not normally considered part of an employee’s employment. Notwithstanding that, she listed a number of factors to be considered in the analysis, including whether:

• the recreational activity was part of the employee’s job
• she was instructed to participate
• the activity occurred during normal work hours
• the employee was paid or provided with other consideration for attending at the event
• the activity occurred on work premises.

The adjudicator rejected most of the employee’s arguments. She specifically rejected the argument that the provision of beer, wine and entertainment by the employer was in the nature of consideration for attending at the party.

She also rejected the argument that attendance of management at the event meant that it was under employer supervision. This was in spite of an acknowledgment by the employer that it had reprimanded a reckless dancer for his behaviour at the party.

The only possible factor which favoured the employee’s claim was that she felt pressured to attend at the party.

Weighing all the relevant facts, the adjudicator concluded that the employee’s participation in dancing at the Christmas or holiday party was unconnected to her employment.

Proper and appropriate behaviour

Employees also have responsibilities in relation to work-related social events. While they are of course entitled to let loose with work colleagues outside the workplace, they are bound to conduct themselves in a proper and appropriate manner. They share accountability with their employer for the safety and well-being of their co-workers and must be professional and respectful.

In van Woerkens v. Marriott Hotels of Canada Ltd., 2009 BCSC 73, the B.C. Supreme Court considered whether Marriott Hotels wrongfully dismissed a senior sales and marketing employee for conduct in which he had engaged at the employer’s Christmas or holiday party.

Marriott alleged it had just cause to discharge the employee without termination notice or pay in lieu of notice because he permitted the excessive consumption of alcohol, engaged in sexually suggestive dancing, condoned an after-party where employees drank heavily, and inappropriately touched a female subordinate sexually and was dishonest when questioned about the incident.

The court found there was insufficient evidence to prove that the employee facilitated excessive drinking contrary to company policy. It also found the employee was not guilty of any misconduct for drinking heavily or condoning the after-party because there was no company policy prohibiting or restricting such things.

The court, however, determined the employee had committed serious misconduct by inappropriately touching his female subordinate in a bathroom when she was intoxicated and propositioning her following the after-party, the next day and roughly a month later. The court found Marriott had provided training to the employee with respect to its sexual harassment policy in advance of the party. It also concluded he was dishonest in the course of the company investigation when he denied that he had been in the bathroom with his subordinate and he had inappropriately touched her.

In light of all of the above, the court held that Marriott had just cause to terminate the employment relationship.

Best practices

No employer wants to find itself in an unpleasant situation – especially at a time of good cheer, jolliness and celebration.

To mitigate legal risk and minimize or eliminate the potential for liability in damages, here are some of the lessons to be learned from the case law and proactive steps for you to take as a diligent and responsible employer:

• Ensure that all employees are invited to work-related social events like Christmas or holiday parties but be clear that attendance and participation are entirely voluntary.
• Hold parties at venues outside the workplace that have professional serving practices.
• Ensure that you and the commercial host have sufficient liability insurance.
• Ensure that all employees are aware of your expectations in advance of the event.
• Promote responsible alcohol consumption and remind employees not to drink and drive.
• Discourage employees from driving their personal vehicle to the event.
• Make an effort to ensure that everyone gets home safely after the event. Remind them in advance of low cost or free ride services (e.g. Operation Red Nose) and alternative transportation options (e.g. public transit) or even offer reimbursement for taxi or Uber rides.
• Communicate and properly train your employees in your respectful workplace policy, including the part related to zero tolerance for sexual harassment, and enforce that policy consistently.
• Properly and thoroughly investigate all alleged incidents of harassment or other misconduct as soon as practicable.

Employers should not be discouraged or dissuaded from putting on a Christmas or holiday party or similar work-related social event, but encouraged to exercise good old-fashioned common sense and to be cognizant of your legal responsibilities as an employer to avoid any nasty surprise or unnecessary incident or course of events.

James D. Kondopulos is a founding member and partner (practising through a law corporation) at the employment and labour law boutique of Roper Greyell.