Picture shows the Saatchi & Saatchi 2003 Christmas Party .  photograph by edwina pickles.taken on 4th dec 2003 SPECIALX 22174 drinking , partying , celebrations

As far as workplace safety law is concerned, the office Christmas party is the office. Photo: Edwina Pickles

For many employees, the work Christmas party is an opportunity to let their hair down and enjoy a glass of champagne on the company dime. For employers, a Christmas party is a reward to staff for a year of hard work. However, the often heady combination of alcohol and underlying workplace tensions has the potential to turn an end-of-year celebration into a perfect storm of inappropriate conduct, with serious consequences for employers.

The High Court recently held, in the controversial motel sex injury case, that a sufficient connection or association with employment may be found if an employer has encouraged an employee to be present at a particular event. While the High Court did not consider there to be a sufficient connection between the public servant's work trip and her night-time romp, work functions have a much clearer association with the employment relationship. In short, if an employer has encouraged an employee to engage in a particular activity by, for example, inviting staff to attend the Christmas party, then that party will be considered by the courts as being in the course of employment.

Nevertheless, it can be easy to forget that work functions are an extension of the workplace. Employers can, and should, expect employees to maintain the same standards of conduct at the Christmas party as would ordinarily be expected in the office. While it may be entertaining to have few champagnes or beers and let your hair down, if it isn't the kind of behaviour that would be accepted in the photocopy room then it shouldn't be condoned at the Christmas party.

Even incidents that occur after employees ''kick on'' from a Christmas party can relate to their employment to the extent that serious incidents can irreparably damage workplace relationships. Engaging in sexualised or otherwise inappropriate behaviour in front of colleagues in the early hours after the party may make it impossible to resume a professional relationship on Monday morning. In these circumstances, courts have previously found that a colleague's distress about inappropriate behaviour can provide a sufficient ground for investigating an employee's conduct and, if necessary, sacking them.

Christmas parties are not simply pitfalls for employees: employers still have a duty to ensure the safety of their staff at the party and, importantly, can be vicariously liable for employee conduct that contravenes harassment, discrimination and workplace safety laws. While this may sound like an alarmist approach to the silly season, the reality is that, under Australian employment laws, businesses have ever-increasing obligations towards their employees. Failure to properly consider an employee's welfare, even at after-hours functions, can have serious repercussions, both financial and reputational, for businesses.

So what can employers do to ensure that the Christmas party is a fun, collegiate and drama-free affair? Managers should clearly communicate their expectations to employees before any workplace function, preferably in writing, and, of course, ensure that they lead by example. Reminding staff about workplace policies relating to work health and safety, sexual harassment and dress standards may be considered wowser-ish, but it may also mean your employees will think twice before using the Christmas party as an opportunity spread a little bit too much Christmas cheer.

Employer tips

  • Circulate a reminder to staff that workplace standards will still apply at the party.
  • Serve a substantial meal early in the evening - finger food won't cut it.
  • Have a contingency plan if someone slips on the dance floor or a conflict arises.
  • Don't single out people who aren't drinking or who opted out of the $10 secret Santa.
  • Arrange alternative transport so that people aren't tempted to drink-drive.

Jennifer Wyborn is a partner and Emma Vautin is a lawyer in the employment, industrial relations and safety team at Meyer Vandenberg Lawyers.