Challenges for Company Parties

Year-end holidays are upon us and with them come some challenges for employers.

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Employers, in their effort not to offend those who have differing beliefs, sometimes struggle with how to embrace year-end holidays.  A generic “Happy Holidays” or “Seasons Greetings” is a common and safe way to acknowledge year-end festivities.  However, from strictly a human relations standpoint, is it really that terrible to tell someone that you know celebrates a specific holiday “Merry Christmas”, “Happy Hanukah” or “Happy Kwanza”? This acknowledges that the company recognizes their special day.  However, it is still appropriate to refer to your year-end party as a “holiday” party in order not to offend those who may not celebrate a specific, traditional holiday.

It’s My Party…

Company-sponsored parties abound during December.  However, these good tidings come with the potential to create huge areas of liability for your company.

Alcohol tends to be the biggest culprit in contributing to claims of harassment, inappropriate touching and car crashes on the way home from the company’s festivities.  Here are some tips to help the employer minimize its liability when hosting special events:

  • If possible, don’t serve alcohol. This may mean making a change to your traditional celebration.  Consider holding your event during work time and catering lunch for your employees.
  • If alcohol is served, try to hold the event off property and after regular work hours.  Also, make the event completely voluntary and ensure your supervisors understand that they shouldn’t try to force anyone to attend the celebration.  As a side note, even if alcohol isn’t served, it’s still a good idea not to require employees to attend holiday parties when they may not celebrate any holiday or whose religious beliefs prevent them from participating in holiday parties
  • Educate workers about the dangers of drinking and driving.
  • Remind employees that your normal workplace standards of conduct will apply and that misconduct at or after the party will result in disciplinary action.
  • Don’t serve alcohol to anyone under 21. Consider issuing colored bands or pins to underage employees to help bartenders identify those who aren’t yet “legal” to drink.
  • Always serve food if you are making alcohol available.
  • Limit the amount of time the bar is open and also consider only serving beer and wine.
  • Rather than an “open bar”, have a cash bar or use a ticket system to limit the number of drinks.
  • Use professional bartenders to serve drinks and ensure they stop service to those who appear to be intoxicated.
  • Tell your supervisors and managers that they are “on duty” during the party and that they should keep any eye on employees to make sure they don’t drink too much.
  • Take away the keys of intoxicated employees. Arrange for a taxi service (at no cost to the employee) to transport employees who feel that they should not drive. Also consider providing hotel rooms for intoxicated employees.
  • Check the company’s general liability insurance policy and review any potential additional coverage needed with your broker.

Compensating Employees for Holidays

Many employers struggle with how to compensate employees for those days when the organization will close for those observances. Private employers are generally not required to compensate employees for days on which they perform no work.  However, most employers recognize that in order to be competitive, they need to compensate employees for days the facility is closed in observance of a holiday.

According to a recent survey conducted by Employers Association Forum, most employers will be closing all or part of December 24 as well as Christmas Day.  Most employers will be closed the following week on New Year’s Day.

For non-exempt employees, the company is required to pay them for all hours worked during the week, but the time off to observe a holiday does not have to be paid, although most companies provide paid holidays as a benefit.  Time off for the holiday does not have to be included in the calculation of hours worked for purposes of overtime.

Some companies have adopted policies that say an employee has to complete his or her orientation period before they can receive pay for a holiday. That policy is fine for non-exempt employees.  However, exempt employees fall under a different set of rules under the Fair Labor Standards Act.

Although the company is not required to pay holiday pay for a non-exempt employee, the Fair Labor Standards Act (FLSA) does not permit you to dock the pay of a salaried exempt employee because the company is closed for a holiday.  The Department of Labor Fact Sheet specifically states: “If the employer makes deductions from an employee’s predetermined salary, i.e., because of the operating requirements of the business, that employee is not paid on a “salary basis.” If the employee is ready, willing and able to work, deductions may not be made for time when work is not available.” 

 This is the “most wonderful time of the year”.  It just requires some planning on the part of the employer to keep it that way.

Best wishes for Happy Holidays and a bright and prosperous New Year!

Contributed by Christine Crews, SPHR, SHRM-SCP is Vice President of Human Resource Services for the Employers Association Forum, Inc. (EAF). EAF is a non-profit corporate membership-based association dedicated to serving the business and HR communities with world-class HR tools, hotlines & legal compliance, news & trends, surveys & economic data, benefits & insurance, risk management, training & consulting, and leadership & organizational development. HCCMO members receive discounted rates on all EAF classroom training at EAF’s training center in Longwood. Click here to learn more about EAF membership benefits

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