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Ho Ho Oh No! HR Pitfalls at the Annual Holiday Party
12/09/2016

As the outdoor air cools and becomes crisp, office-wide relief becomes palpable as businesses finally stop blasting the office’s AC-on-steroids system.  Ugly holiday sweaters that violate all fashion sensibilities, if not office dress codes, start to appear on the regular.  And all are delighted by that one co-worker in the open cubicle area who plays the 24-hour holiday music radio station.  It’s that time of year again!  Time for holiday cheer and avoiding the pitfalls that can come from the annual holiday office party.

The Naughty List
 
Santa’s list wouldn’t be complete if it didn’t have a few coal recipients.  The following are true stories of office parties that went horribly awry.
 
  • A California bank branch held an annual holiday party at a local restaurant.  There were only about 15 people in attendance, but they included a female bank teller, the teller’s female boss, and the boss’ boyfriend (a manager at a different bank branch).  The entire affair, including the alcohol, was funded by the bank’s budget.  The office party officially ended, but the party-goers continued their revelries.  But once the bank’s party ended, the bank employees had to fund their own cocktails.  The party continued into the restaurant bar area, then moved to another bar as the night progressed, and finally ended up at the boss’s house.  You can probably see where this is going.  The teller ultimately accused her boss and the boss’s boyfriend of sexual harassment, and brought suit against the bank, alleging that the bank should have foreseen the harassment, particularly in light of the alcoholic drinks that were provided at the holiday party.  The trial court ultimately found the bank wasn’t liable, largely because the office party ended, and the drinking that continued wasn’t on the bank’s dime.   
  • A restaurant in New Hampshire employed a head chef who trended toward the vulgar – on a daily basis.  The other employees in the kitchen had just about had it when the restaurant held an off-premises holiday party that proved to be the last straw.  The head chef apparently arranged a “white elephant” gift exchange, but the gag gifts included items named “penis butter” and “boob lube.”  One employee sued the restaurant for negligent infliction of emotional distress, claiming that she suffered psychological trauma from working at the restaurant, and the owners did nothing to stop the conduct.  The employer tried to get the claim kicked out of court, but the court let the claim proceed, holding that “the official nature of a company holiday party makes sexual harassment at the party a risk created by employment, even if the party is held off company premises.”  
  • A receptionist at a Washington D.C. business suffered a cold winter’s day at work when her boss yelled at her about capabilities and “brandished” a stack of papers at her.  That bad day turned worse when she went to the office holiday party the following day.  At the party, she complained to a Vice President of the business about how she had been treated by her boss the prior day.  The VP sympathized with the receptionist and told her that she could work for him from now on rather than her mean old boss.  But as the drinks flowed during the party, the VP started making sexually explicit remarks ending with the statement that the receptionist “could make more money working at Hooters” than with the company.   Unsurprisingly, the receptionist sued.  The business was able to escape liability because the court found that the comments at the holiday party alone did not rise to the level of sufficiently severe and pervasive conduct that could support a sexual harassment claim.
The Nice List   
 
The naughty ones definitely provide us with some holiday “don’ts.”  Now let’s try to learn some lessons from the good employers whose stockings will surely be filled with “jelly of the month club” holiday bonuses.
 
  • An employee at a Louisiana collection agency brought suit for sexual harassment.  Among her allegations, the employee alleged that a male co-worker made unwelcome advances and suggestive remarks at the office’s annual Christmas party.  But she also admitted that a different manager who overheard the remarks immediately intervened and the harasser stopped his improper behavior.  This quick action by the manager helped save the company when the court threw out the harassment claim, noting that management immediately redressed the improper conduct at the Christmas party, as required by law.
  •  In Colorado, a female employee of a homeowners association attended a Christmas party sponsored by the association.  The employee claimed that, while at the party, her male supervisor wished her a “Merry Christmas,” bent down, and kissed her on the lips.  She also alleged that the supervisor rubbed her back and snapped her bra strap.  A month later, the employee told a co-worker about the manager’s alleged conduct at the Christmas party, and the co-worker in turn notified the board of directors.  The association launched an investigation the same day, and ultimately interviewed several witnesses, some of whom present at the party and who would likely have been witness to the alleged misconduct if it occurred.  The investigation did not ultimately support the employee’s allegations against her manager.  Nonetheless, the association put corrective measures in place, including minimizing contact between the employee and the supervisor, and instituting mandatory diversity training for all employees.  There were no further complaints about the supervisor after the investigation concluded.  The employee sued, but the court threw her claim out because the homeowner association was able to establish that it acted promptly to correct the alleged misbehavior at the Christmas party.
  • A saleswoman at a Michigan clothing store went to a Christmas party held at the home of an assistant manager.  The party was on a Sunday night, after working hours.  Though she came to work the following day, she did not report to work on the Tuesday after the party.  Rather, she and her lawyer notified the store that an assistant manager had sexually harassed the saleswoman at the Christmas party a couple days before, including pulling her onto his lap and making aggressive sexual remarks.  The store immediately suspended the offending manager and launched an investigation.  By the following Monday – less than a week after the saleswoman reported the harassment – the store terminated the assistant manager.  Nonetheless, the saleswoman never returned to work, and filed suit against the clothing store claiming sexual harassment and constructive discharge.   The court threw the case out stating the store’s corrective measures “epitomized how a responsible employer should act when confronted with an allegation of employment discrimination.”
Surviving the Holidays
 

So what have we learned from the impish elves among us?  First, perhaps unlimited alcohol during an after-hours holiday party, all paid for on the company’s tab, isn’t the best idea.  Second, now might be a good time to republish your company’s anti-harassment policy to remind employees that harassment and discrimination won’t be tolerated, and as a reminder of how to report harassment.  Third, remind your managers that they should intervene if they witness harassment by others, and management has a responsibility to report incidents of harassment to HR.  Finally, and most importantly, if you do learn of improper behavior at an office party, put your policy into action by launching an immediate investigation.  Suspending the alleged wrongdoer during the pendency of the investigation might be in order.  And make sure you assure the complaining employee that you take such incidents very seriously and will take corrective action if appropriate.  Following this process will keep you on Santa’s nice list during the holidays, and all year round.

 


Authors
Don Berner Image
Don Berner, the Labor Law, OSHA, & Immigration Law Guy
Boyd Byers Image
Boyd Byers, the General Employment Law Guy
Jason Lacey Image
Jason Lacey, the Employee Benefits Guy
Additional Sources
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