Holiday Party Liability: Five Tips to Reduce Your Risk

For many landscapers and nursery owners, the end of the year is a valuable opportunity for your team to grow closer and celebrate the year’s accomplishments with a company-sponsored holiday party. Rewarding employees for their diligence and hard work improves employee satisfaction and retention. Still, these events are notorious for reputation-eroding blunders stemming from high spirits and too much alcohol — such as sexual harassment, bullying or physical assault. Without the proper precautions, a contentious holiday party could make you the target of an employment practices liability claim or lawsuit.


Follow our tips to help reduce your risk of an out-of-control holiday party resulting in costly claims and a tarnished reputation, and learn how you can help protect yourself and your business in the event of an employment-related claim with Employment Practices Liability Insurance (EPLI).


Do I Need Employment Practices Liability Insurance?

Every employer, no matter the size of their business, must adhere to local, state and federal laws concerning their employment practices. EPLI is a specialized insurance policy designed to cover business owners’ defense costs and damages relating to employment-related claims, such as discrimination, retaliation, workplace harassment and wrongful termination.

EPLI insurance is becoming more common with employers seeking this necessary protection to fill insurance gaps, as employment practice lawsuits are not usually covered by a general business liability insurance policy, according to the Society for Human Resource Management (SHRM).

Additionally, 2022 market insights from Gallagher, a global insurance broker and risk management services firm, indicate that social inflation continues to increase defense costs and settlements, leading to higher-than-normal single-plaintiff payouts.* It’s becoming more common for single-plaintiff lawsuits to result in seven-figure settlements before the case goes to trial, likely due to a combination of high plaintiff wages and companies’ desire to settle quickly and preserve their reputations.

Gallagher also points to broader social trends, such as social movements concerning sexual and racial harassment or discrimination, as well as layoffs caused by inflationary pressure and recession worries, as drivers increasing the risk of wrongful termination lawsuits. As an employer in today’s increasingly litigious world, it’s essential to know your risks and prepare your business against them accordingly.

Reducing Liability at Holiday Parties

A year-end holiday party should be a festive time for employees to get together and celebrate their accomplishments. Consider the following tips to help reduce your liability and ensure your event is enjoyable for all:

  • Set standards for attendee behavior – Similar to how your business should have set policies and procedures for ensuring proper employee conduct, holiday parties require ground rules. Whether your party is on-site or at a secondary location, remind your employees that their holiday party is an extension of the workplace. All relevant restrictions concerning non-discrimination, anti-harassment, non-fraternization and drug use still apply. Consider asking management-level employees you trust to act as party monitors to ensure a quick response if it seems like someone's behavior is inappropriate.

  • Limit alcohol consumption – While company office parties in their heyday might have allowed a free open bar for the entire event, today’s employers know better. Adding alcohol to an employer-sponsored event can reduce inhibitions and blur the lines between managers and employees, as well as acceptable and unacceptable behavior. Consider implementing drink tickets to ensure no one overindulges or serving only beer and wine while keeping hard liquor, such as vodka, off the menu. Also, if serving alcohol, ensure all employees have plans for driving home safely — whether via a designated driver, ride share service or public transportation.

  • Choose your location and timing wisely – A familiar bar in a busy downtown location can bring a sense of festivity and liveliness to your work party, but too much holiday spirit can cause your event to spiral out of control. Avoid planning your party for peak party hours, such as on a Friday evening, when attendees might be more eager to let loose following a long work week. Instead, consider making your party a luncheon or setting defined hours that discourage overindulgence.

  • Make sure your event is inclusive – Your holiday party should focus on celebrating the accomplishments of the year, not a particular holiday. While Christmas might be at the forefront of your mind, remember your employees likely have a variety of religious beliefs and holiday traditions. Instead, keep your theme and decorations generic — staying away from colors like red and green, which are commonly associated with Christmas, or blue and white, which are traditionally used in Hannukah celebrations. The less you highlight one particular holiday, the more likely your employees from all backgrounds will feel comfortable.

  • Know what your team wants – It might be a tradition for your nursery to host an on-site party in the greenhouse every year, but when was the last time you asked your team what they wanted to do? Your employees might prefer spending the day doing something meaningful, such as volunteering at a local food bank or participating in a fun group activity like sledding or bowling. Establishing a holiday party committee, developing office-wide surveys and talking with your employees about how they enjoyed prior festivities can help ensure everyone has a good time.

By following our tips, you can create a lively office party atmosphere that is fun and celebrates the achievements of the past year while still being appropriate for the modern workplace. Similarly, staying alert for the liability risks posed by office parties — and carrying the proper insurance coverage — can help safeguard your company against employment-related claims. Contact MNLA’s insurance expert, Ashley Thomas, for a free risk analysis to ensure your business has successfully reduced its holiday party liability. Learn more about available coverage at or contact for a coverage review. 


*Source: Gallagher,

The information contained herein is offered as insurance Industry insight and provided as an overview of current market risks and available coverages and is intended for discussion purposes only. This publication is not intended to offer legal advice or client specific risk management advice. Any description of insurance coverages is not meant to interpret specific coverages that your company may already have in place or that may be generally available. General insurance descriptions contained herein do not include complete Insurance policy definitions, terms and/or conditions, and should not be relied on for coverage interpretation. Actual insurance policies must always be consulted for full coverage details and analysis. Insurance brokerage and related services to be provided by Gallagher Affinity Insurance Services, Inc. (License No. 100310679 | CA License No. 0783129).

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