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Employer's Choice Solutions
Joni Prose
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4 Big Reasons to Skip The Company Holiday Party


Sexual Harassment Risk 
If there’s an expectation that employees should attend your holiday party or you suggest or imply that attendance is required, your party might be considered an extension of your workplace. This makes you responsible for providing an environment free from sexual harassment, discrimination and other unlawful behavior.

A relaxed, party atmosphere combined with alcohol reduces inhibitions and can lead to careless behavior. While a single inappropriate comment or advance might not be enough for a sexual harassment charge, it might lead to a hostile work environment claim if other inappropriate behavior has occurred.

Workers’ Compensation Obligation

Whether it’s a luau contest or your version of “Dancing with The Stars,” if physical activities or contests cause employee injuries, they might also result in claims for workers’ compensation.

Unless attendance at your party is entirely voluntary and there’s no reasonable expectation that employees should attend, you might be responsible for workers’ compensation even in states that specifically exclude off-duty recreational, social and athletic events from workers’ compensation liability.

Overtime Compensation

If an employee can make a case that attendance at the holiday party is required for employees, you might be obligated to pay nonexempt employees their hourly wages for attending the party. 

If a nonexempt employee has already worked 40 hours the week of the party, the party time is overtime, and you are obligated to pay time-and-a-half.

Defense Costs

If an employee threatens a lawsuit for a claim such as religious discrimination, creating a hostile work environment, encouraging sexual harassment or creating an unsafe workplace, you’ll need to hire an attorney to defend the company against the claim. 

Even if you win, you’re still out the cost of your defense. Many insurance policies don’t reimburse any expenses for mounting a defense. They only provide money if you lose and you’re required to pay damages.

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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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