Employer liability when employees keep socializing after a work-related event
By Jeffrey R. Smith
We spend a lot of time with co-workers, usually eight or more hours every day, five or more days per week.
That’s a lot of time interacting with those people, and it’s inevitable that friendships will develop. Many would also agree that, even if it’s not full friendship, a certain level of camaraderie can help staff, particularly in a team environment where people must work closely together to achieve a common goal.
To this end, many employers stage events where employees can socialize and spend time together where they don’t have to do work. This can include holiday parties, team-building events or meals out on the company dime.
When these are officially sanctioned by the employer, and especially when the employer foots the bill, they can be considered work-related and the employer still has certain responsibilities as an employer. But what happens when employees, under their own initiative, want to extend a function beyond what has been planned?
A decade ago, there was a case that made headlines when a law firm in British Columbia sponsored a dinner out with associates and law students working at the firm. The firm regularly held these dinners as a way to enhance communication between people and to assess who at the firm would be best suited for marketing opportunities.
After dinner, several attendees decided to continue the party at a nearby nightclub on their own. During the festivities, a drunk associate fell on a law student while dancing and seriously injured her. The student successfully sued for almost $6 million in damages. The associate filed a claim with the firm’s insurance provider under a policy that provided coverage for injuries arising out of activities “within the scope of employment.”
The associate argued the dancing at the nightclub was an extension of the dinner, which was within the scope of employment — as none of them would have been there if it weren’t for the firm-sponsored dinner.
The claim was denied by the insurance company and more recently two courts (Danicek v. Alexander Holburn Beaudin & Lang, 2012 CarswellBC 3353 (B.C. C.A.)), which found the firm’s event stopped at the end of the dinner. The decision by some employees to go somewhere together was independent of the firm and wasn’t sponsored by it, said the courts. Though the dinner had some business purpose of assessment and communication enhancement, the nightclub activities gave no advantage to the firm.
Though it was agreed by the decision-makers the nightclub wasn’t part of the work function, it raises the question of how far employer liability extends when it comes to extracurricular activities. There have been cases where an employer has borne some responsibility when an employee harassed another employee outside of the workplace when the harassment was found to have begun at the workplace.
In the above circumstances, the partying began at an employer-sanctioned event and the accident occurred after some employees extended the fun. Since the employees wouldn’t have been there if it weren’t for the employer organizing the event — and serving alcohol at the dinner, which could have played a role in the accident — should the employer have some responsibility? What is the threshold for employer liability and the extent of the workplace?
Jeffrey R. Smith is the editor of Canadian Employment Law Today, a publication that looks at workplace law from a business perspective. He can be reached at [email protected] or visit www.employmentlawtoday.com for more information.
