Personnel Practices: Potential Legal Liability for Employers at Corporate Events

11211833_mCompany-sponsored events can be a great way to contribute to employee morale, raise the company’s profile in the community, and provide an opportunity for positive public relations. Many employers hold events, such as holiday parties and summer outings, as a way to thank employees for their service. Other employers may sponsor or organize community or charitable events in order to give back to the communities where they’re located. When planning a company-sponsored event, Rhode Island employers should be aware of several pitfalls so as to potentially avoid unexpected liability.

Liability for injuries sustained by employees
Typically, employees who are injured during their voluntary participation at employer-sponsored social or athletic activities are not entitled to workers’ compensation. However, to the extent that the employee’s injury was caused by the negligence or other misconduct of the employer, the employee may be able to recover damages against the employer in a civil lawsuit. Although employers should always ensure the safety of their employees, employers should be particularly mindful that workers’ compensation insurance may not cover injuries sustained at company events, and the employers may otherwise be responsible.

Vicarious liability issues
Rhode Island courts generally hold employers liable for the acts of their employees committed within the scope of employment. Although factual issues may arise as to whether attendance at a company event is considered an activity “within the scope of employment” for legal purposes, employers should nonetheless be mindful that any injuries caused by an employee at a company event may give rise to a claim or lawsuit against the employer, whether or not the injured party ultimately succeeds.

Employers should be particularly cautious at events where alcohol will be served. Although Rhode Island courts have not yet adopted the social-host theory of liability with respect to adults over the legal age, the courts have imposed liability for injuries arising out of the service of alcohol to minors. When providing alcohol at company-sponsored events, employers should use common sense and ensure that only employees over age 21 partake in certain festivities.

Best practices
When planning a company-sponsored event, be aware of the following best practice tips to avoid potential headaches down the road:

  • Provide transportation, especially for events when alcohol will be served. The cost of buses or cab vouchers is a small investment compared with potential liability issues arising from car accidents or other incidents.
  • Consider providing social media guidelines, or implementing a social media policy concerning corporate events. Although employees may be eager to share photos from office holiday parties or other outings, photos taken by employees may not be the best representation of the image your business would like to project, particularly if the photos could potentially be viewed by customers or clients.
  • If you intend to use photos from the event for marketing purposes, obtain consent from all subjects of the photos, including employees and non-employees who may also be present at the event. Failure to do so may result in liability for the unauthorized use of the subject’s image.
  • For events involving physical activity, such as employer-sponsored field days or road races, obtain liability waivers prior to participation in such activities from employees and invited guests. Such waivers should typically include a certification that the participant is physically capable of participating in the activity, an acknowledgement that there are risks associated with the activity, and an agreement to hold the company harmless for any injury sustained.

Awareness and consideration of these issues in advance may assist employers in ensuring that company-sponsored events run smoothly, and in minimizing potential liability.

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