Most organizations that anticipate any kind of holiday celebration for employees start their preparations in November, so here’s some savvy advice to help with your plans. We consulted Christopher J. Boman, partner in the Irvine, California, office of law firm Fisher & Phillips.

“Crazy things can happen,” says Boman. He’s had to defend employers in a variety of situations—most involving alcohol—when inappropriate comments and/or behavior occurred that caused problems. It’s probably enough to say that Boman has seen it all, including nude pictures. But your employees would never allow that to happen, would they? Nevertheless, says Boman, some wise precautions can help to ensure that they don’t.

Boman generally recommends against parties held on work premises, and we asked why. “The major issue is compensation,” he says. Attendance at any holiday party, regardless of where it’s held, should absolutely be voluntary, he advises; that’s the first requirement. But if you stress that it’s voluntary and then hold it in the workplace during what would otherwise be work hours, how will nonexempt employees be compensated, if at all? Here’s a useful approach: If hourly workers attend the party, advise them not to clock out until they leave the facility; that is, pay them while they’re at the party. If they don’t wish to attend, they can either use vacation time and leave the facility when the party starts or, if it’s possible, continue working at their stations for a full day’s pay.

What else can go wrong? “Don’t let what should be a rewarding experience lead to problems,” Boman urges. What can go wrong at all parties, no matter where they’re held, is—you guessed it—alcohol. Will it be served? How will it affect your employees? If your party is held in the workplace, you can choose to serve only beer and wine. If hard liquor is served, whether on or off your premises, Boman stresses the importance of hiring a professional bartender: That person, not you as the employer, should be responsible for ensuring there is no underage drinking and that no further alcohol is served to someone who’s clearly intoxicated. Remember, too, that alcohol can blur the usually clear boundaries of workday relationships, such as those between managers and their subordinates—a situation ripe for charges of sexual harassment.

Off premises, with significant others invited, a co-worker can be accused of spending too much time with the accuser’s spouse or, well, you name it. To preclude as much of this as possible, advises Boman, have all party attendees sign an acknowledgment that the party is a work function where managers remain on duty and all workplace rules remain in place.

If you are tempted just to trust that your employees will behave, we’d suggest you survey your workplace demographics. Generally, the younger your workforce, the greater the potential for inappropriate romances, workplace rivalries that turn into fights, overindulgence in alcohol, and more

Keep Holiday Bash Behavior in Line

Boman has seen some pretty awful circumstances arise during holiday parties—circumstances that brought suits against the employer, in which Boman defended them. So he has devised a set of tips that he hopes will keep you, as an employer, out of trouble. Here’s a sampling:

• Ensure that invitations and other party publicity are appropriate, in terms of language and illustrations. Boman defended an employer in a case where a party flyer was presented as evidence in court.
• Prohibit “after parties,” which are easy to arrange if the main party is held at a hotel: A manager who rents a room and invites some attendees to join him there is stirring a recipe for disaster.
• If you hold a party on your premises, provide not only a professional bartender but also transportation home for any employee who appears to have overindulged in alcohol.
• If you conducted layoffs during the year, don’t throw a lavish holiday party. It sends the wrong message, and employees may wonder if their departed co-workers could have worked a few weeks longer for what the party cost.
• Consider alternative celebrations, such as charitable contributions in employees’ names, either as a substitute for a party or instead of party gifts.
• If a company exec offers to host the party at his or her home, serving alcohol should be avoided. If there’s alcohol served and something goes wrong, the executive can be held personally liable.