Last drinks at the Christmas Party?

Employers who provide alcohol at Christmas parties, or indeed any work-sponsored occasions, may need to think twice about what they should do when employees misbehave following a recent decision of the Fair Work Commission.

It has been no secret that employers can be liable for employee behaviour that occurs at work-sponsored functions outside business hours. But this decision has raised the question of how a company can manage that risk while wanting to reward staff and allow them to enjoy themselves in a non-work setting?

The Commission found that an employer who provided staff with unlimited alcohol through an ‘open bar’ Christmas party unfairly dismissed the employee for his behaviour in sexually harassing and bullying work colleagues and telling his boss to “f*ck off”. This was regardless of the fact that the employee, who was also a union delegate and safety representative, was shown to have consumed alcohol before the function, and had received a prior warning about unacceptable behaviour.

The work Christmas party was typical of many workplace functions: the employer had organised it to run from 6pm-10pm at a hotel in Sydney. Invitations and notices had gone out to employees, and as part of the room hire the hotel would serve drinks and finger food for attendees. The party was communicated as a “Thank You” to staff for their hard work throughout the year, but they were also reminded to behave appropriately.

Despite the employer’s clear policies about appropriate workplace behaviour, the Commission found that it was “contradictory and self-defeating” for the employer to require compliance with its policies on workplace behaviour and at the same time to allow the unlimited service of free alcohol at the function.

Even where the hotel was bound by rules on the responsible service of alcohol, the employee in question was not refused a drink and nobody from the hotel or the employer had asked him to stop drinking. Further, it was said that the employer had not placed anyone with managerial authority in charge of the function; that it was “let to run itself”.

The decision highlights the importance of companies taking steps to minimise risks at Christmas parties and other out-of-hours work functions. This includes restricting the amount of alcohol served, keeping to a set period of time for the event, and considering how employees will get home safely.

Ensuring that there is managerial supervision of the function is also important. That is, for managers, the Christmas party could be an extension of a day’s work.

Despite strong sexual harassment laws and clear workplace policies, the Commission ultimately found that how a company manages a Christmas function and its decisions on what to do with intoxicated employees could limit how an employer should respond to cases of employee misconduct.

For this reason, Ai Group urges all employers to think twice about how they manage their Christmas function, but remains concerned that the Commission’s decision unfairly limits the individual responsibility of employees.

Ai Group is running a webinar on minimising risks at Christmas parties on 29 July 2015. Watch out for the July 9 edition of Industry Newsletter for details.

Will this decision by the Fair Work Commission affect your company’s Christmas Party plans this year? Share your thoughts on the decision below.

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As Ai Group's National Manager – Workplace Relations Policy, Nicola is involved in employment test cases and law reform affecting the workplaces of industry. She regularly appears in the Fair Work Commission and Government Inquiries on behalf of Ai Group members, and has many years of “on the ground” strategic experience in advising employers in employment law and people & culture strategies.

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