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After The Holiday Party Fizz, The HR Headache Begins

Dec 28, 2014
HR Acuity


It’s time for the company’s annual holiday party! There will be great food, time with colleagues and a fun evening for all. Managers say “cheers” to their employees for a job well done, and everyone will toast the year ahead. In a recent survey by Challenger, Gray & Christmas, Inc, a global outplacement consultancy, almost 90% of company respondents were planning a holiday party in 2014. With plenty of food and drink for all, what could be better?

Unfortunately, outside the required formalities of the workplace, employee behavior can change. Often in combination with too many drinks, co-workers can say, insinuate or do things that are inappropriate at the annual event. HR Acuity® advises its clients that the off-site holiday party is legally deemed to be an extension of the workplace. As such, a company can be sued by an employee for misconduct that occurs at the event. That’s why after the holiday party fizz, the human resources (HR) headache begins.

Sexual Harassment at the Holiday Party

One of the primary employee-related allegations that can arise from a holiday party is sexual harassment. Sexual harassment is a Title VII violation of the Civil Rights Act of 1964. It encompasses:

unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature … when submission to or rejection of this conduct explicitly or implicitly affects an individual’s employment, unreasonably interferes with an individual’s work performance or creates an intimidating, hostile or offensive work environment.

The problem is that although holiday parties are considered an extension of the workplace, there are obvious differences. People wear something festive for the party and outside the typical workplace attire. It shouldn’t prompt a suggestive comment by a colleague, but sometimes it does. People are often drinking and as the evening wears on, they may say something or behave inappropriately towards a colleague. If there is music and dancing, there may be behavior on the dance floor that is out of place, and the list of potential issues goes on. One of the worst ideas for the holiday party is mistletoe for all of the obvious reasons.

One of the worst ideas for the holiday party is mistletoe for all of the obvious reasons.

Quid Pro Quo from the Holiday Party Title VII is multi-layered, and another hazard is quid pro quo. According to the U.S. Department of Labor,

Quid pro quo harassment generally results in a tangible employment decision based upon the employee’s acceptance or rejection of unwelcome sexual advances or requests for sexual favors….

With quid pro quo, there is either an implicit or explicit pressure to behave a certain way or face employment consequences. During a holiday party, this type of misconduct can be as simple as a supervisor promising an employee a raise or promotion in exchange for a date, a dance or even more explicit sexual behavior. It can encompass a threat of termination or salary cut if the employee doesn’t agree. Under the auspices of quid pro quo, the breadth of misconduct that can occur from the holiday party is vast.

Hostile Work Environment after the Holiday Party As an extension of the workplace, the holiday party can also prompt a hostile work environment claim. In this case, the severity of the harassment must be such that it alters, in effect, the conditions of employment. The harassment might be on-going in nature or just significant enough to impact the employment environment. Often, misconduct which falls under hostile work environment will encompass repeated behaviors.

Holiday parties easily facilitate allegations of a hostile work environment. For one, they are notorious for Secret Santa or gift exchanges. An inappropriate or sexually explicit gift can be deemed harassment. If the gift giving continues back at the workplace and it’s unwanted by the recipient or inappropriate, the company can be held liable for a hostile work environment. In a slightly different example, Rich v. Arizona Multiple Listing Service, Inc., a Jewish employee alleged a hostile work environment when crosses were put on the invitations to a mandatory holiday party and the party had carolers singing Christian songs.

The key takeaway remains that because holiday parties represent an extension of the workplace, companies can be liable for employee misconduct at the party. In advance of the event, a few gentle reminders for employees are in order such as not overdoing alcohol consumption or maintaining appropriate behavior. However, if allegations arise that stem from the holiday party, they must be managed as employee-related events. Robust documentation, investigation and reporting processes for employee claims are as relevant for allegations that stem from a holiday party as if the claim were to come from the workplace.

If your HR department is grappling with the fallout of a holiday party, call 888.598.0161 or contact us today to learn more about HR Acuity® On-Demand, our award-winning Software as a Service (SaaS) solution that delivers defensible, best-practice processes for employee-related risk mitigation.

HR Acuity