The Christmas party

 

 

In the last of our Christmas feature memo's for the year we tackle Work Christmas Parties. Yes they are everywhere at the moment and local restaurants and clubs are cashing in while they can. We love it! It's a great chance to relax after a hard year and forget office politics for a night. However these same office politics put on hold can surface during the night........ Just add alcohol.

 

Alot of today's memo is lifted from an editorial I read in Employsure. It put the words I wanted into perspective so well I left them mostly as is. Whilst the focus is on the traditional boozy affair, we want to make sure you are aware - as employers - that your obligations under relevant workplace safety and employment acts doesn't end, even at a Christmas function.

Think about every Christmas party you've been too. Normally it results in at least one member of staff becoming the brunt of all jokes over the coming year. Office romances are not uncommon either. Sometimes fleeting, but always making for good office gossip in the months after. What was once deemed 'a bit of harmless fun' can now result in multi million dollar law suits. A recent case is David Jones – both of the occasions on which it was alleged that Mark McInnes had harassed his fellow staff member were off-site staff functions.

 

So, what are the risks? There are the obvious ones. The lewd or suggestive comment that is not received well or the wandering eyes and hands of colleagues under the influence of alcohol. What might result in a snarl or a slap across the face outside work, can constitute harassment in a working environment.

There are also more technical risks. Staff are still at work at a funded Christmas party that they are required to attend, even if it is after hours, so employers run the risk of worker’s compensation claims if injuries are the result of high jinks. Some modern awards also require transport home to be funded after certain times in the evening. So businesses might inadvertently open themselves up to some significant costs if staff are entitled to funded trips home all over the place.

These risks can be protected against by checking the relevant award and having solid policies on behaviour at work, including discrimination and harassment. Looking at it from a 'risk transfer' perspective, nowadays we have Management Liability products (ML).  A Christmas party and potential backlash over an alleged incident is only one area where ML shows it's value. This product covers the companies directors, management, officers and employees against alleged breeches of an act. Now an "act" is a very broad term. There are thousands of Acts relating to work in NSW alone. You could be breaching one every day without even realising it. The office Christmas party naturally is a concern for employers for 'harrasment.' This can be sexual, race, religion or continued workplace bullying. Again after a few brews tongues tend to loosen up and who knows what has been lying beneath the surface.

A good ML policy can also cover you for fidelity. (Theft of company funds) I was speaking with a client in Tamworth last week and raised ML, when I touched on this cover his eyes pricked up. He is not sure if theft of cash is happening but has a fair idea it is. So his concern is if he lays an allegation that is false he could have a lawsuit on his hands. Management Liability is the final piece of the puzzle in your business protection plan. You cover your physical assets, your Public Liability and your Business Interruption, now, part 4 complete the picture, cover your potential for employment practice breeches.

Claims in this sector are on the rise. In the past 2 years alone there has been a 27% increase in ML type claims. In NSW alone The Fair Trading commission prosecuted 213 businesses for breeches of which 184 were successful. 30% of companies with employees between 1 and 500 experienced a fraud against their company in 2012. AND, for Directors of a company alone, did you know that over 750 state and territory laws exist in Australia that impose personal liability. The numbers are frightening but what is worse is that smart solicitors are now aware of ML products, meaning, if an aggrieved employee comes to them wanting to discuss say 'wrongful dismissal' the lawyer will know that the employer may have a policy in place to protect himself. Meaning win lose or draw someone is making money out of it.

Yes I agree we are now in very litigious times but knowing this - even if you cant stand it - and not protecting yourself against it is risky business.

 

So drawing this back to the work Christmas party is the office joker really going to change their behaviour after a few beers on the basis of what is said in an employee handbook? Probably not. The average employee is not aware fully of OH&S or workplace rules within an office. Whilst ML is a preferred product to protect yourself on a broader level, maybe better options for the risk averse include looking at less booze fuelled activities. Maybe supporting a community project for a day or putting the cost of a party to gifts to staff. You could select a charity to give the money to instead, chosen by the staff, or look at giving additional paid leave during any Christmas shut down as a gift.

One of these options could serve the purpose of bringing about some decent camaraderie and spirit in the season of good will without the legal hangover. For those that want to stick with tradition, just be prepared to add the cost of a claim to your bar tab.

*** Information is General in nature and is not taking into consideration any one individuals circumstances or situation. Information courtesy of VERO Insurance, Chubb Insurance and Employsure.com.au Thank you to VERO Insurance for the banner add.***