It’s Party Season – Are You Liable?

• When you’re hosting an event, limit how much you drink yourself; be sure you’re always in a state that will allow you to monitor the activity.

• Keep an eye on alcohol consumption at parties, and be prepared to take steps to stop people from driving if they are impaired. Encourage designated drivers and arrange for taxis if necessary.

• Pay attention to who is drinking and don’t serve alcohol to minors. Doing so could not only expose you to financial liability, you could face criminal charges as well.

• Hire a professional bartender. Don’t let employees—especially supervisors or managers—serve drinks or even pour their own. Be sure the bartender knows to alert you if someone needs to be cut off.

• Use strategies designed to reduce alcohol consumption, such as serving only beer and wine rather than hard liquor; have a cash bar or ticket system rather than an open bar; bring the alcohol out in intervals rather than putting it all out at the same time; and set a cutoff time for serving alcohol, such as the last hour of the party, and switch to coffee and other non-alcoholic beverages.

• Consider holding your holiday parties in a restaurant or other location away from your work premises where someone else is responsible for serving drinks and monitoring sobriety. This does not completely relieve you of liability, but it does add an extra layer of protection that you don’t have when the party is at your place of business.

• For company parties, remind employees that while the party is voluntary and you want them to have a good time, your company’s normal workplace standards of conduct will be in force and misconduct at or after the party could result in disciplinary action.

• Serve plenty of food and make it comfortable for people to eat. If you’re serving buffet style, be sure the food is easily accessible and there is plenty of seating.

• Be sure holiday decorations don’t create hazards. For example, be sure items such as trees are secure and won’t fall over and that wires are hidden so no one will trip on them.

• Be pro-active with potential environmental hazards. Clear snow and ice from walkways, and warn your guests of any hazardous conditions. Some states and cities have ordinances that require landlords to clear walkways; check with your local city hall or state attorney general’s office to find out if you are subject to such laws and exactly what you have to do to be in compliance.

Avoiding liability during holiday parties is not complicated or difficult—and you should be doing it anyway. However, accidents happen, so be sure you have appropriate insurance in place to protect you and your company. Your insurance policy should cover any damage awards up to the specified limits (consult with your insurance agent, attorney, and financial planner to determine what limits you need), as well as paying for your defense should you be sued. Be sure you understand the limits of your liability and umbrella policies and that your coverage is sufficient on both your personal and business properties.

Of course, the best insurance policy notwithstanding, the easiest lawsuit to deal with is the one that never happens. So combine adequate insurance with common sense, and enjoy the holidays.