With summer upon us, many employers are organizing workplace social events where alcohol may be permitted or even provided. These events can be a great way to boost morale, but they can also expose employers to the following liabilities, unless steps are taken to reduce these risks.
“Social Host” Liability
Much like commercial hosts (bars, pubs etc.), employers owe a duty to their employees and third parties to monitor the consumption of alcohol at events where alcohol is served and must avoid providing alcohol to those who are intoxicated, where there is any risk of subsequent injury. Otherwise, employers can be held liable for damage to property, injuries to their employees, and injuries to third parties such as passengers in a car or in other cars involved in an accident caused by the intoxicated employee. The courts tend to hold employers to a high standard of care and have more than once held employers liable for multi-million dollar lawsuit payouts.
Employers are also potentially liable even where they do not provide alcohol but are merely hosting a ‘bring your own alcohol’ event on their property. As the party in charge of the location of the event, employers are bound by the general duty of an occupier of land to ensure persons at the event, even when intoxicated, are not at undue risk of injury from the condition of the premises (e.g. adequate railings and barriers). As well, courts have held employers liable for injuries caused by the drunken behaviour of others on the premises participating in the event, such as the drunken employee who knocks over an elderly customer.
Fines, Penalties and Insurance-Premium Rate Hikes
Even if employers are not sued for the types of damages mentioned above, they may be found to be in breach of a number of provincial employment laws and regulations by allowing alcohol to be served at the workplace. For example, under workers compensation legislation, employers have a duty to maintain a safe workplace at all times and, depending on the timing and setting of the event, serving and/or allowing alcohol in the workplace may breach this duty. This may subject employers to hefty fines and penalties. Even if an employer has arranged for private general liability insurance to cover claims by non-employees arising in the workplace, payment of a claim can lead to a refusal to renew a policy of insurance or an increase in premiums.
There are several ways for employers to continue to hold social events with alcohol while minimizing their exposure to these liabilities:
- ensure that these events begin after the work day has ended for their employees;
- consider holding these events at a commercial establishment. The commercial establishment would then bear the onus of monitoring the consumption of alcohol;
- if employers want to hold these types of events at the workplace, they should consider hiring a professional bartender who can monitor alcohol consumption;
- whether the event is held on or off-site the employer should provide taxi vouchers so that their employees can arrive home safely; and all such precautions should be announced in advance to ensure employees can plan to take advantage of them.