If you’re like most employers, you’ll be hosting a party for your workforce during the holiday season. And, if you’re like most employers, you’ll be serving liquor at the party. That’s fine. Just make sure you understand what you’re getting yourself into. You don’t need a lecture about the dangers of drinking and driving. But what you might need is a clear explanation of the legal risks involved. Most companies know about the recent cases holding employers liable for injuries caused by workers driving drunk. But not everybody understands the nature of that liability and how to manage it.
This article will explain the legal responsibilities a company assumes when it furnishes alcohol to workers—not just at the holiday party but any time during the year. And it will show you what to do to minimize the risk of exposure to liability for workers who drive under the influence of the alcohol you provide them.
The Law of Host Liability
In Canada, certain persons who serve alcohol to guests can be liable for negligence if the guests get drunk and cause injuries to themselves or others. This is called “host liability” and it extends to employers who furnish alcohol to their workers. Where does this law come from? And what does it mean? Let’s answer these questions one at a time.
Employer host liability for the drunk driving of workers is an outgrowth of the employer’s obligation to protect workers. But it’s not contained in any of the provincial or territorial OHS statutes; nor is it in the regulations that implement those statutes.
The law comes from court cases. More precisely, host liability and its application to employers who serve alcohol to workers is part of negligence law. Unlike statutes and regulations which are written by legislators and regulators, respectively, negligence law is generally made up by judges one case at a time. Each case a court decides sets a precedent for future cases. Host liability is a collection of such court rulings over time.
Three Key Court Cases
Knowing how host liability came about and how it came to cover employers isn’t just interesting history; it’s essential to understanding your legal responsibilities. It started in 1974 when the Canadian Supreme Court decided a case called Jordan House Ltd. v. Menow, (1974) D.L.R. (3d) 105 (S.C.C.). A customer walked into a bar, drank too much and got run over by a car afterstumbling into the street while walking home. The customer sued the bar for serving him to the point of intoxication and then letting him leave knowing that he couldn’t properly care for himself.
The Court found the bar guilty of negligence. Bars, restaurants and other commercial establishments that serve alcohol have a duty to protect their patrons, it said. Essentially, the Court was saying that a bar can’t just serve customers until they get drunk and they turn them loose on the streets.
The Menow case involved a commercial establishment. But in 1996, the BC Supreme Court applied host liability to an employer. A supervisor brought a cooler of beer to a crew erecting a trade show display on a hot day. A crew member got noticeably drunk and drove into a ditch on the way home. As a result, he became a quadriplegic. The Court found the company 75 percent responsible and ordered it to pay the victim $2.7 million in damages.
Holding the employer responsible for the victim’s injuries might seem unfair. After all, the victim was a responsible adult capable of making his own decisions. But the Court said that the employer in this case was just like the bar in Menow. It supplied the beer; the supervisor knew the victim was drunk but didn’t try to stop him from driving home. Employers have an obligation to guard workers against unreasonable risks, the Court said, just as bars have a duty to protect their customers [Jacobsen v. Nike Canada Ltd., [1996] B.C.J. No. 363 (B.C.S.C.)].
The Nike principles apply equally to employers who host parties where liquor is served. In 2001, an Ontario company was held 25 percent responsible for injuries caused by a worker who got into an accident after drinking wine at the company Christmas party. Keeping a worker from driving home drunk after a party it hosts is part and parcel of the duty to ensure workers a safe workplace, according to the court [Hunt v. Sutton Group Incentive Realty Inc., (2001) 52 O.R. (3d) 425].
Insider Says: The Ontario Court of Appeal later reversed the Hunt case on a technicality involving the jury; but it didn’t say that the case
was wrong to impose a duty on the employer. Thus, the concept of host liability on the part of an employer remains the law until and unless a court says otherwise.
What Does It Mean?
Understanding that you have a duty as a host is the first step. What do you actually have to do? Three things, according to the Canadian Supreme Court:
[Stewart v. Pettie, (1995), 121 D.L.R. (4th) 222 (S.C.C.)]. Here’s a closer look at what each of these things involves.
1. Duty to Monitor
You must keep track of how many drinks each of your guests has consumed. For example, one of the reasons the employer was found negligent in Hunt was that the bar at its party was open and unsupervised. As a result, workers were able to help themselves to cocktails and there was no way to monitor how much each guest had drunk.
What to Do: Before the party, designate one or more persons to monitor the consumption of others, advises lawyer and leading alcohol liability consultant Shelley Timms. One possibility is to designate your own people as monitors. Caution them not to drink during the party. “Monitors need to be sober to do their job effectively,” Timms explains.
Another approach is to hire professional bartenders who are trained to keep an eye on how much their customers drink. In either case, issuing drink tickets to each guest enables you to not only track but control consumption. The same is true of a cash bar. This is the solution Timms recommends. “The problem with tickets,” she explains, “is that the guests who don’t drink might give their tickets to the guests who do.”
2. Duty to Determine If Guests Are Intoxicated
The second thing a host must do is try to figure out if a guest is intoxicated. You don’t have to administer blood tests and breathalyzers to your guests. But, according to the Canadian Supreme Court, you need to make “reasonable assumptions” about whether a guest is impaired based on how many drinks she’s had.
What to Do: Monitors should probably make the call on intoxication. Of course, you’ll need to tell your monitors what “intoxication” means. You don’t have to make up a definition. Just use the legal limits for impaired driving. Under the Canadian Criminal Code, individuals can be charged with a crime if they drive with a Blood Alcohol Content (BAC) of over .08 percent. Some suggest that .08 is too high. “Most provinces will temporarily suspend the license of a person who is caught driving at .05 for 12 hours to get the person off the road,” explains Timms.
Another tricky part of using BAC levels is that it’s hard to monitor a person’s BAC without the benefit of a blood test. But remember that your determinations of intoxication don’t have to be scientifically precise. All you’re expected to do is make “reasonable assumptions” about intoxication. Monitors can do this by observing how many drinks guests have had. But monitors need to consider that individuals get impaired at different rates. It depends not just on the number of drinks they’ve had but on their gender and weight (among other things).
To help you overcome these problems, we’ve created a briefing paper that shows monitors how to identify impairment based on drinks consumed, gender and body weight. The briefing is based on data from the US Department of Health. And while it’s not 100 percent precise, it should enable your monitors to make “reasonable assumptions” as required by the negligence law.
3. Duty to Prevent Intoxicated Guests from Driving
If you know or have reasonable grounds to suspect that the guest is impaired, you must make an effort to prevent him from getting behind the wheel. This is fine when the guest cooperates. But what happens if he puts up a fight? How far does an employer have to go to keep an intoxicated guest from driving?
There’s only been one case where a court had to answer that question—the Hunt case. The employer in that case did try to dissuade the worker from driving. It offered to call her husband; and it arranged for another worker to drive her home. But the court said this wasn’t enough. The employer should have taken her keys and car, brought her to a hotel and, if none of that worked, call the police. This ruling sent shock waves through Canada. “If the employer had done these things, it risked liability underemployment law, not the least of which wouldbe harassment,” suggests Timms. Although Hunt isn’t necessarily the final word on the subject, the law clearly expects employers to make a determined effort to keep drunk guests off the road. A token protest or offer to drive the person home probably isn’t enough. What to Do: Use carrots such as appointing designated drivers, giving out taxi vouchers and even reserving hotel rooms where drunk guestscan go to “sleep it off.” But be prepared to use the stick, too. That would include:
Insider Says: One of the things employers do to try and limit their liability is have workers sign a waiver promising not to hold the company responsible if they get drunk at the party and get hurt driving home. Such a waiver isn’t worth much. Courts aren’t likely to enforce them, lawyers tell the Insider, especially if the waiver is signed after the worker has started drinking. “The alcohol washes away the worker’s capacity to enter into a binding waiver,” explains Ontario lawyer Hugh Christie. Moreover, the waiver doesn’t bind third parties that the worker might injure. On the other hand, Timms suggests that guests are more apt to act responsibly if they sign a waiver even if it’s not actually enforceable. Just make sure you give guests the waiver before the party, not during it.
Conclusion
Of course, there is a much simpler way to manage host liability risks: Don’t serve alcohol at your holiday party (or at picnics or other company affairs during the year). In fact, lots of companies have decided to keep their parties dry, especially after Nike and Hunt. But alcohol remains a staple at most holiday parties. Your company has every right to make the decision to serve it. But, as the safety coordinator, your job is to ensure that your company understands the legal risks it assumes when it exercises that right and that it takes the appropriate steps to manage those risks.
INSIDER SOURCES
Hugh A. Christie, Gowling, Lafleur Henderson, LLP, Ste. 4900 Commerce Ct. West, Toronto, ON M5L 1S3.
Shelley Timms, Timshel Services Inc., 2100 Bloor St. W., Ste. 6, Toronto, ON M6S 5A5, timshel@timshelservices.com, (416) 767-4210.
If you’re planning to serve drinks at your holiday party, here are steps that alcohol liability consultant Shelly Timms says you can take to prevent drunk driving accidents:
Click here to view Model Notice – Instruct Monitors on Intoxication
Click here to view Model Notice – Warn Employees of Office Party Alcohol
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