Limiting Your Liability During the Company Holiday Party

With the fallout from the #MeToo movement forcing employers to change their internal conduct policies, they are also reassessing the office holiday party.

While gatherings can be a good time for your staff to mingle casually with their colleagues and clients, they can also prove to be a liability for businesses – particularly if you serve alcohol.

Not all companies are canceling holiday parties, though. Some are being a little more careful and limiting or eliminating alcohol served at holiday celebrations.

If you are throwing a holiday party, you should take steps to limit risks and make sure you are protected with proper insurance coverage.

Your biggest concern should be intoxicated workers leaving the party and driving. Almost all states have liquor liability laws that allow an injured third party to sue not only the person who injured them or damaged their property, but also the individual or organization that overserved them alcohol.

While these laws were originally written to cover bars and other establishments that serve alcohol, they have been extended to cover “social hosts,” which include:

    • Employers that hold events where they serve alcohol.
    • Individuals or groups that hold events (including weddings and summer barbeques).

Limiting your liability

Experts recommend that you take steps to limit your liability:

  • Lay down the ground rules – You should hold a meeting and create documentation for your employees to sign that spells out their duty to act responsibly and treat all other staff with respect. This should also include advising them to drink in moderation and not drink and drive.
  • Lead by example – Management should model the behavior they expect from everyone at the party: polite conversation and drink in moderation, if at all.
  • Hold the party offsite – This is a smart move because if there are issues that occur, it’s best they don’t happen at your place of business.
  • Consider not serving alcohol – This is the safest bet to ensure you are not vicariously liable for any intoxicated employees.
  • Use different approaches if you serve alcohol – If you do plan to serve alcohol, consider requiring your staff to pay for drinks. This also has the effect of people drinking less if it’s on their dime. Another option is to issue drink vouchers to limit the amount of drinks each person can have.
  • Hire a professional bartender  – Most bartenders are trained to detect signs of intoxication and are better able to cut someone off in a professional and polite manner.
  • Offer alternative beverages  – You should also offer non-alcoholic beverages, and always serve food so people don’t drink on empty stomachs.
  • Stop serving towards the end of the party  – Stop serving alcohol at least one hour before the end of the party, and instead bring out the coffee, tea and soda.
  • Arrange transportation  – If you are serving alcohol, you should make special transportation arrangements before the party. Encourage your employees to take advantage of the transportation for their and the public’s safety if they have had drinks.

Insurance considerations

If you have liability concerns, you should call us to discuss your current commercial general liability coverage to make sure that it doesn’t have any exclusions or conditions for these kinds of risks.

If you have gaps, you may want to consider special event coverage that would cover liquor liability and other liability exposures specific to the event.

We can help you check your policy to see if liquor liability is covered by your CGL policy.

If there is any harassment at the party that could put you in the crosshairs for a harassment lawsuit, you could also be sued. This kind of action would not be covered by your CGL policy, but it would be covered under an employment practices liability insurance policy.

An EPLI policy will extend coverage to your business for any discrimination, sexual harassment, emotional distress, and other workplace-related charges. The policy should include third party coverage, which covers claims made by non-employees, usually clients or customers, who allege that an employee engaged in wrongful conduct such as sexual harassment or discrimination.

Marijuana Laws Require New Workplace Policies

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As states continue to liberalize marijuana use, employers are left in a bind in terms of enforcing no-drug policies, respecting their employees’ right to privacy and keeping a safe workplace.

While a majority of states have medical marijuana laws on their books, only a handful of states require employers to accommodate (to a degree) staff who use medical marijuana. And many states, including California, have established case law stating that employers do not have to accommodate someone who has a medical marijuana prescription.

Complicating matters for employers, more states are legalizing recreational marijuana.

Since employers have to balance their legal obligations to their employees, they also have to be able to ensure they have a safe workplace that is free of drugs. Here’s a guide to the main issues facing employers:

ADA compliance

The Americans with Disabilities Act prohibits employers from discriminating against employees on the basis of a disability, and the law requires employers to provide a reasonable accommodation to them if needed. The word “reasonable” is there to ensure that the accommodation does not impose any undue hardship on the employer.

Often, medical marijuana is prescribed to people with disabilities who are considered protected individuals under the ADA. In many cases, the use of marijuana can be vital in allowing a disabled worker to do their job and also perform major life activities.

While the ADA bars discrimination against individuals with disabilities for employment purposes, courts in many states have ruled that medical marijuana use is not a reasonable accommodation.

But, in 2008, the California Supreme Court ruled that employers have a right to drug-test and fire patients who test positive for marijuana, regardless of their medical use.

It based its decision on the fact that because the state’s Fair Employment and Housing Act does not require employers to accommodate illegal use, an employer can lawfully terminate an employee who uses medical marijuana.

More recently, in 2012, the Ninth Circuit similarly held that the ADA does not offer job protection for medical marijuana users because marijuana is an illegal substance under federal law.

That said, as medical marijuana becomes more accepted, companies may want to consider revising their policies to include accommodations for use.

One way to do this is to create policies that bar marijuana use in the workplace, particularly smoking or vaping, but be more forgiving with use outside of work hours. If you also drug-test, you’ll need to make exceptions as employees can show positive for drug use at work even though they may have used marijuana the day before at home.

Your policies should take into account that you have a legitimate interest in ensuring that any medications the employee takes are used in a responsible manner and will not affect job performance. Your company policy could state that a prescription for medical marijuana does not entitle an employee:

  • To be impaired at work.
  • To compromise his or her safety, or the safety of others.
  • To smoke in the workplace.
  • To unexcused absences or late arrivals.
Recreational-use states

If you have a business in one of the handful of states that has legalized recreational use of marijuana, you should consider revising your company’s drug policies.

While you cannot legally bar employees from using cannabis outside the workplace, you can regulate them using it on the job or showing up intoxicated at work.

One good solution is to model your recreational marijuana policy after your current policies on alcohol.

To cover your operation, you should probably prohibit employees from smoking marijuana at the office or to come to the workplace under the influence of any psychoactive substance. The policy should outline the specific consequences for breaking the rule.

Some employers may consider prohibiting marijuana use in a recreational-use state and continue drug-testing of workers. But this approach could run into legal challenges and would be difficult to enforce if the employees are not using on the job.

The exception should be for workers that operate heavy machinery, or work in construction, transportation or other dangerous occupations. In these jobs, working under the influence of marijuana should be strictly prohibited, just as on-the-job alcohol use is. Companies can also alter drug-screening guidelines to exclude cannabis during routine drug tests.

Since the effects of marijuana can last many hours, you will also specifically need to spell out the rules for lunch breaks. Employees should be able to return from their breaks and be ready to start work again without being under the influence.

The takeaway

Overall, while it seems daunting, these issues will get ironed out over time. For now, you should try to set policies that will ensure that you can keep a safe workplace, while respecting employee privacy.

Over time, the policies that will be recommended for employers are likely to be similar to those for alcohol use and intoxication in the workplace.

Cal/OSHA Issues Emergency Rules for Posting Injury Forms Electronically

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Cal/OSHA is implementing emergency regulations that require California employers with 250 or more employees to submit their 2017 Form 300A summaries electronically by the end of this year. That’s the form that you signed and posted in your workplace from Feb. 1 to April 30.

Form 300A contains only the summary of injuries and is not the actual log, which contains the names of the employees who were injured.

For the electronic filing, you will simply take the same information on the form you posted earlier this year and enter it into an electronic database.

The short ramp-up period will require employers to quickly act to comply with the emergency regulations, which were approved by the state’s Office of Administrative Law in early November. The new regulations were implemented on an emergency basis to put California’s regulations on par with those of Federal OSHA.

Who do the new rules apply to?

The new regs apply to the following employers:

  • Those with 250 or more employees, unless specifically exempted by section 14300.2 of Title 8 of the California Code of Regulations.
  • Certain employers with 20 to 249 employees in specific industries that are listed in Appendix H of the emergency regulations.

Among the industries in the latter category are:

  • Agriculture
  • Construction
  • Manufacturing
  • A number of retail businesses
  • Transportation
  • Warehousing
  • Health care

You can find a full list of the above industries on pages 8-10 in Cal/OSHA’s emergency regulations: www.dir.ca.gov/dosh/doshreg/Recording-and-Reporting/Text-of-Amended-Regulation-Revised.pdf

Employers that do not have to fill out OSHA logs include:

  • Those that had 10 or fewer employees during the entire year; and
  • Those that have 20-249 employees, but their industry does not fall within the list of “high-risk industries,” as above.

After this catch-up period at the end of the year, all applicable employers will be required to submit their Form 300A electronically every year going forward.

Until Cal/OSHA promulgates new regulations to make that a permanent rule, the agency advises all applicable employers to follow the instructions on Fed-OSHA’s “Injury Tracking Application” webpage: www.osha.gov/injuryreporting/index.html

Cal/OSHA will be implementing its own online tool and when it does, we will notify you.

Do You Have an Emergency Action Plan?

Evacuation plan macro

How would you escape from your workplace in an emergency? Do you know where all the exits are in case your first choice is too crowded? Are you sure the doors will be unlocked and the exit access, such as a hallway, will not be blocked during a fire, explosion or other crisis?

Knowing the answers to these questions could keep you safe during an emergency. And the answers should be readily available to all of your staff in your organization’s emergency action plan (EAP).

Almost every business is required under Occupational Safety and Health Administration standards to have an EAP. The purpose these plans is to facilitate and organize employer and employee actions during workplace emergencies.

Well-developed emergency plans and proper employee training (that helps workers understand their roles and responsibilities when executing the plan) will result in fewer and less severe employee injuries and less structural damage to the facility during emergencies.

A poorly prepared plan likely will lead to a disorganized evacuation or emergency response, resulting in confusion, injury and property damage.

Putting together a comprehensive EAP that deals with issues specific to your worksite is not difficult. It involves taking what you learn from conducting a workplace evaluation and describing how employees will respond to different types of emergencies, taking into account your worksite layout, structural features and emergency systems.

If you have 10 or fewer employees, you may communicate your plan orally. For firms with more than 10 employees, the plan must be written, kept in the workplace and available for employee review.

Although employers are required to have an EAP only when the applicable OSHA standard requires it, OSHA strongly recommends that all employers have an EAP.

Important elements

A few of the important elements of an EAP include:

  • Procedures for reporting fires and other emergencies.
  • Procedures for emergency evacuation, including the type of evacuation and exit route assignments.
  • Procedures for employees who stay behind to continue critical plant operations.
  • Procedures to account for all employees after evacuation.
  • Names or titles of employees to contact for detailed plan information.
  • Alarm system to alert workers.

In addition, designate and train employees to assist in a safe and orderly evacuation of other employees.

Review the EAP with each employee covered when:

  • The plan is developed or an employee is assigned to a new job,
  • Employees’ responsibilities under the plan change, or
  • You change the EAP.