The holiday season is upon us once again, it seems to come quicker and quicker each year. In the spirit of the holiday season, having a company holiday party always seems the festive thing to do.

Office parties can be an excellent opportunity to lift employee morale and celebrate organizational successes as a cohesive team. However, for employers, it is important to remember that unfortunately there are some substantial risks involved with sponsoring a company holiday party, especially if alcohol will be served.

Most of the time employer sponsored parties happen without incident, but it is important to be aware of the potential issues that may arise and take all available precautions to limit any potential liabilities, such as the chance for personal injuries, third party injuries or sexual harassment issues.

It is important to also remember that injuries that occur at a company sponsored event may be subject to claims under both workers compensation and general liability insurance.

Recent court rulings in many states have held that persons (including employers) who serve liquor may be held liable for injuries to guests or third parties as a result of accidents caused by intoxication. Jury verdicts in these cases can range into the millions of dollars, particularly in situations where a drunken employee causes fatal injuries to a third party on the way home from a company function.

The only sure way to avoid potential liability for alcohol-related accidents is not to make alcohol available. However, if you decide to allow alcohol at the event, there are a number of ways you can attempt to minimize any negative outcomes such as;

Have a clear policy that is effectively communicated to employees that over-consumption of alcohol at company sponsored events is not acceptable and that intoxication and inappropriate behavior at the party will be grounds for disciplinary action
Schedule the event on a weekday, as people generally drink less during the week.

Have the party off premises at a hotel or restaurant.
Have the party during non-working hours.
Do not conduct company business during the party.
Attendance to the event should be strictly voluntary
Develop a party planning committee to organize the event
Do not provide liquor purchased with company funds
Hire a professional bartender to monitor the amount of alcohol in the drinks and the consumption rate of party goers
Do not provide open bars. Instead provide cash bars and implement a drink limit per individual (i.e., a ticket system).
Do not permit managers or supervisors to buy alcoholic beverages for employees

Drinking should not be the main focus of the event, plan events, games, or other entertainment to be the focus of the event.
Collect employees keys when the arrive for the event
Offer a wide variety of non-alcoholic beverages
Consider closing the bar early in the evening, perhaps after cocktail hour and prior to food being served.
Serve foods rich in starch and protein, which stay in the stomach longer and slow the absorption of alcohol.
Arrange for alternative transportation home for employees that may have had a bit too much, such as limousines, taxis, or employees that have volunteered to be designated drivers.
If the event venue is a hotel, arrange for a block of rooms that employees can reserve at a discounted rate.

Holiday parties should be fun and safe for all involved. Employers can not eliminate all risks associated with a company sponsored event, but they can take steps to mitigate the potential risk by following a few simple steps as those outlined above.

Author's Bio: 

Michele O'Donnell joined the team in January 2007 and currently leads MMC's elite team of HR Consultants. Ms. O'Donnell has been involved in the Human Resources industry for more than 14 years, bringing vast training and management experience to the MMC leadership ranks. Her experience spans the broad scope of labor law, regulatory compliance and HR Best Practices, drawn from her rich experience as Director of HR for several firms throughout her career. She currently works to ensure that MMC's consultants forge long lasting relationships with our clients, fostered in exceptional service and unsurpassed HR expertise. Ms. O'Donnell earned her baccalaureate degree in Business Administration from Auburn University before receiving her Masters degree in Human Resource Management from Troy State University.