Happy Hour, Company Outings, and Sexual Harassment: Does the Line End at the Close of Company Work Hours?

Many employers want to build morale and esprit de corps by encouraging after hours events, like happy hours, company sports leagues, cookouts, etc. While these events can be a great way for employers to get to know their employees, and for workers to socialize with one another off the clock, they can also create questions about liability. Specifically, what happens if the socializing goes a little too far, and someone feels pressured by unwanted sexual advances? What can employers do to limit their liability when hosting or encouraging after hours socializing?

What is Sexual Harassment?

Before knowing how to prevent liability, it is important to know exactly what sexual harassment actually is. According to the [New York State Department of Labor][1], sexual harassment is:

1. Any unwelcome sexual advance
2. Requests for sexual favors
3. Other verbal or physical conduct of a sexual nature

It is against the law when:

1. Submission to the conduct is either explicitly or implicitly a term or condition of an individual’s employment
2. Submission to or rejection of such conduct by an individual is used as the basis for employment decisions affecting such individuals
3. The conduct has the purpose, or effect, of unreasonably interfering with an affected person’s work performance or creating an intimidating, hostile, or offensive work environment

Similarly, New Jersey’s Law against Discrimination (LAD) prohibits sexual harassment. According to the [State of New Jersey’s Department of Law and Public Safety][2]:

Sexual harassment includes unwelcome sexual advances, requests for sexual relations or other verbal or physical conduct of a sexual nature … Quid pro quo harassment occurs when an employer, or an employer’s agent, implicitly or explicitly attempts to make submission to sexual demands a condition of employment … it is unlawful for an employer or an employer’s agent to condition favorable treatment such as promotions, salary increases, or preferred assignments, on an employee’s acceptance of sexual advances or relations.

Hostile work environment sexual harassment occurs when an employee is subjected to sexual, abusive, or offensive conduct because of his or her gender … The conduct does not have to be sexual in nature and does not have to involve physical contact.

The Problem with Parties

With these definitions in mind, it is easy to see how conduct at an after-hours event could lead to legal claims regarding sexual harassment. With people feeling more relaxed—particularly if alcohol is involved—it could be easy for someone to say or do something that would clearly be out of bounds in the workplace. Although it occurs outside of work, the statement or behavior could cause someone to feel as though their future employment is in jeopardy or leave them feeling extremely uncomfortable. Under these circumstances, even behavior that otherwise might not have caused alarm can take on a new meaning in the eyes of the harassment victim, leading to lawsuits.

Generally, employers are liable for the actions of their employees while acting in the course of their duties. Thus, if the harassment occurs during an event or activity the company sponsors, particularly if that event occurs during business hours or has mandatory attendance requirements, then the employer may be clearly liable. Liability is less clear when the harassment occurs outside business hours, attendance is voluntary, and the employees are not paid for attending. Nevertheless, the consequences may still flow back into the workplace after the event, so it is better to take steps to avoid liability ahead of time.

What Can Employers Do to Avoid Liability?

First, it is wise to avoid activities involving alcohol. While happy hours may seem a natural after-hours activity for coworkers to enjoy together, the loss of inhibitions can easily lead to poor decisions. For situations when it is not possible to completely rule out alcohol use, it may be wise to include an alcohol and drug use policy in your employee handbook. The policy should indicate that whenever alcohol is served at company-sponsored events, employees are expected to drink responsibly, not to drink and drive, and to otherwise abide by all company policies—including those forbidding sexual harassment.

Communicate your policies regarding sexual harassment frequently, including any announcements regarding the after-hours event itself. These reminders should inform employees that company policies remain in effect during employer-sponsored events, even if they occur outside of work and work hours.

Make attendance voluntary and ensure the event occurs outside normal working hours and outside of the workplace. This will help to ensure that the event cannot be characterized as part of the employees’ work duties, helping to limit direct liability.

If someone makes a report of sexual harassment that occurred at the event, treat it as though the infraction occurred in the workplace. Investigate the complaint, take appropriate corrective measures, and contact your company’s employment lawyer for advice on how best to proceed.

Make Sure You Are Protected

Discovering liability after it is already too late is a terrible feeling. You should have the assistance of an experienced employment attorney to help guide you through the turbulent waters of sexual harassment. Legal assistance can save you tens of thousands of dollars and prevent damaging lawsuits before they happen. John J. Zidziunas & Associates will provide you with expert help in your New York and New Jersey sexual harassment and employment law needs, offering advice and representation. Contact us for a free 30 minute consultation, by email or by calling 973-509-8500.

Image courtesy of stockimages at FreeDigitalPhotos.net

[1]: https://labor.ny.gov/formsdocs/DEOD/ga812.pdf
[2]: http://www.nj.gov/lps/dcr/employ.html