Christmas party season is a great time for team bonding, but it is also a time when employees often go too far. Employers should be alert to employment law issues and the contents of their staff policies. It is often not only Santa’s helpers that start the New Year staring at a P45.

Fighting, drunkenness, offensive remarks, unfulfilled promises and unwanted attention are only some of the risks arising from the Christmas party. As Christmas parties are often treated as an extension of the workplace, particularly if only employees attend, that means that if things go wrong, employers may be liable.

The legal technicalities

If employees fight at work, this will constitute gross misconduct, potentially allowing an employer to fire an employee without notice. However, employees with more than two years’ service can claim “unfair dismissal”. In this circumstance, an employer faced with an unfair dismissal claim must prove not only that they had a fair reason for dismissal but also that they acted reasonably in dismissing the employee.

If one employee is fired while another one is “let off” for similar conduct, it is vital that employers have followed procedures that clearly record a plausible reason to justify treating the employees differently.

Employees may argue that it is unfair for them to be fired for events that occurred at Christmas parties, as the matter occurred outside of the workplace. If lots of people who aren’t normally part of the workplace attend the party, then such arguments may be successful, particularly if the event isn’t under the control of the employer or is “unofficial”.

However, even if events occur far away from the workplace and don’t involve other employees, a dismissal can still be fair. A real-life case involved an employee getting caught drink-driving home from the Christmas party held off site at a hotel. The negative impact of the association of the employer with that employee’s actions rendered a dismissal fair, after the correct procedures had been followed.

Employers should be mindful of airing their opinions about employees or making promises that they don’t keep, especially in an environment where there will likely be plenty of witnesses, as such incidents could result in Employment Tribunal claims.

Typical claims arising from Christmas parties include an employee being passed over for promotion or not having got a promised pay rise. If this follows on from unwanted romantic attention, it can lead to discrimination and harassment claims. The costs associated with managing such claims can be huge, even if claims aren’t upheld, and there can also be reputational issues.

Employers should not need reminding that they can be held liable for an employee’s unwanted approaches – unless they can clearly demonstrate that the errant employee was acting completely on their own account.

How can employers protect themselves from these risks?

Employers should have well-drafted policies in place and have easy access to legal advice.

Company policies specifying what is and isn’t acceptable behaviour allow employers to more easily disown and distance themselves from inappropriate actions at the Christmas party and thus can allow employers to escape any liability for the actions that took place.

Policies around pay rises and promotions should clearly stipulate that such procedures must be formally approved and in writing and ideally sanctioned by more than one manager. This will help limit the impact of the “broken promise” scenarios above.

Disciplinary policies should be kept up to date.

However, it is inevitable that there will always be cases where claims will arise despite the employer having in place all the policies it needs.

In those scenarios, employers will need specialist legal advice to guide them through the minefield of employment law risks and to find solutions. A practical difficulty is that even if a case can be fought to a conclusion and won, the costs of securing that victory, alongside the management time and publicity, can be huge. Early resolutions are therefore highly desirable.

If you need advice on what action to take if there has been an incident at your Christmas party, please contact David Jepps.

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This article is for general information purposes only and does not constitute legal or professional advice. It should not be used as a substitute for legal advice relating to your particular circumstances. Please note that the law may have changed since the date of this article.