Office party: goodwill or goodbye?
Published 10/12/2007 | 14:43
And so this is Christmas - the season of good will to all, of presents, carols, festivities and, of course, the annual Christmas shindig.
Everyone has heard the stories of the drunken brawl between staff, or the less than amorous advances of a lecherous manager towards the newly-employed intern.
Office parties appear to be regarded as a licence to pass inappropriate remarks that seem almost acceptable amid a glaze of free alcoholic cocktails.
However, in the present legal climate the cost to employers may be more than just picking up the bar tab.
It may be the costs of litigation brought by an employee following an incident at a Christmas party for which the employer may be held to be responsible.
So for any employer who thought the Christmas party was just a matter of putting a few sausage rolls and mince pies out - accompanied by a free bar - it is time to think again.
An employer can be vicariously liable for acts of employees done in the course of their employment irrespective of whether the employer knew or approved of the offending conduct.
According to case law, the test for determining "in the course of employment" is "whether the employee's wrongful act is so connected with the nature of the employee's work that it would be fair and just to hold the employer vicariously liable" (Lister & Ors v Hesley Hall Limited).
The question is whether office/work parties can be regarded as an 'extension of employment'.
In Chief Constable of Lincolnshire v Stubbs the court found an employer vicariously liable for two incidents of sexual harassment by a male officer against a female officer. Both incidents occurred outside work, in a pub, and one incident was not "work organised".
In Livesey v Parker Merchanting Limited an employer was held vicariously liable for acts of sexual harassment committed after a Christmas party. The Employment Appeals Tribunal reasoned that the harassment formed part of a continuous course of conduct that started prior to the claimant leaving the Christmas party.
Then there is the notorious 'sexism in the city case' of Australian-born solicitor Elizabeth Weston, which was settled for a staggering £1m.
At a 2003 Christmas party a male colleague spilled red wine on Ms Weston's top before proceeding to 'compliment' her on her "great waps", which was followed by similar 'complimentary' remarks. The male colleague was disciplined, but Ms Weston pursued her complaint on the basis that the disciplinary action did not go far enough.
In a recent local case, Paul Hindley claimed he was compelled to resign his position because of severe verbal harassment by fellow employees on grounds of his sexual orientation. Mr Hindley was awarded £6,000 in compensation.
In one unusual case, an employee of eight days was awarded in excess of £118,000 for harassment on the grounds of his sexual orientation, both at the interview and subsequently in training sessions. Although the magnitude of the award is in large part attributable to the conduct of the employer in this instance, it is a stark reminder of the potential exposure of employers.
In the Whitbread Beer case the Court of Appeal held that two employees had been unfairly dismissed. The employees had become intoxicated at a work-sponsored gathering and became abusive towards a senior manager, the irony being that this event followed a behavioural skills seminar.
The Court of Appeal deemed the dismissals unfair because they occurred outside the workplace, and were fuelled by alcohol supplied by the company.
All of the above cases reflect an obvious trend on the part of courts and industrial tribunals to regard Christmas parties and other work-organised social gatherings as an extension of the employment relationship. In so doing, employers are vulnerable to claims taken on foot of incidents that occur during, and even after, the party.
Senior management can also be guilty of less than prudent conduct at Christmas parties as demonstrated in Judge v Crown Leisure Limited.
In this case the Court of Appeal held that a pledge by the special operations manager that the appellant's salary would be on a particular pay scale in two years was not a binding contract. However, this decision was only made because there was insufficient evidence to substantiate the claimant's version of events.
However, the Court of Appeal made it clear that such 'pledges' on the part of senior management could be capable of enforcement if it is sufficiently definite and precise.
Having digested all of the above, there are a few additional matters to consider, namely:
Health and safety
Under legislation employers have an obligation to maintain a healthy and safe working environment. It is arguable therefore that employers are obliged to ensure that the venue for any party is compliant with health and safety standards.
If the party is in the office itself, employers should seek to prevent episodes such as the annual photocopying of certain body parts and so on.
The premises should be accessible for disabled persons.
Under misuse of drugs legislation it is an offence for an employer to knowingly allow the use, production or supply of controlled drugs.
Parties held during the working week are normally followed by a surge in sick leave.
So what can an employer do to protect itself, short of cancelling the Christmas party.
The first step is to limit the risk by demonstrating that you have taken reasonable steps to avert the conduct complained of by an employee.
Tribunals will, when considering this defence, look at whether the employer had taken steps to prevent the employee from doing the act complained of and whether there were any further reasonably practicable steps the employer could have taken.
Such 'reasonable steps' to be taken by employers include:
1. Having properly scripted effective equality, anti-harassment, anti-bullying and anti-discrimination policies.
2. Having adequate grievance and disciplinary procedures.
3. Supplementing such policies with adequate training programmes. All employees must be aware of the policies in place, and properly tutored in the import and application of the policies.
4. Encouraging employees to report discrimination, harassment and so on.
5. Appropriately disciplining employees for violating the policies.
6. In advance of the Christmas party, reiterating that behaviour in contravention of the policies will not be tolerated, and disciplinary action will be taken if considered necessary.
7. Issuing a memo in advance of the party to all staff explaining that inappropriate behaviour will not be tolerated both at the party, and any pre-party gathering, and discouraging excessive drinking.
8. Limiting the time allocated to, or money expended, in the seasonal 'free bar'.
9. Regularly monitoring all policies to ensure that they work in practice.
As the ancient proverb goes, prevention is always better than cure.