'Tis the season to be jolly...but not jolly stupid

Matt McGoldrick, Solicitor | Friday 7 December 2007

Episodes of that seasonal reality show When Office Christmas Parties Go Bad are undoubtedly playing around the globe right now.

While the work party is a chance for employers and staff to celebrate the festive season and sign off on the working year, there are lurking dangers for both sides.

More often than not, the heady mix of alcohol, stress and feeling over-worked provide the potential for matters to go awry. For employees, doing "stupid things" at the Christmas party could, at worst, put their jobs on the line. For an employer, it may mean investigating allegations of bad behaviour and, in a worst case scenario, having to dismiss an employee. Not to mention the potential for damaged reputations through bad publicity.

The Australian case of Paul Brown v Aristocrat Technologies Australia Pty Limited provides a cautionary tale for this time of year.

The horror Christmas party

The sorry story starts with a Christmas party at an upmarket Sydney bar at Darling Harbour. Paul Brown was one of the party goers and a long-standing employee of Aristocrat. According to Mr Brown he drank beer during the party and he vaguely remembered drinking a little bit of red wine towards the end of the party. He estimated that he had about a dozen beers but acknowledged that it could have been as many as 15.

Late into the evening, co-worker Mr Situra, observed another co-worker, Mr Gumulia, pulling a small clear bottle of liquid out of his pocket and tipping a few drops into Mr Brown's wine glass. Mr Brown's says he "flaked out" at about the time the party finished.

This is where things started to go bad for Mr Brown.

Another employee leaving the party at this time caught a glimpse of Mr Brown urinating over the side of the balcony of the bar onto the lower level. This must have been an unpleasant experience for the diners in the restaurant below, some of whom had their meals ruined by Mr Brown's actions.

Mr Wheatley, a co-worker who had seen what happened, ran up the stairs and proceeded to have Mr Brown up about his behaviour. He then hit Mr Brown in the head, and forced him down into the restaurant to pay for the damage he had caused. Mr Brown refused to pay but after the restaurant manager threatened to call the police, he produced his credit card.

Things only got worse for the remaining employees. Mr Wheatley and another staff member Mr Smith helped Mr Brown to leave the restaurant. At this point it appears an argument broke out between the three of them. A fight between Mr Wheatley and Mr Smith ensued, with Mr Smith punching Mr Wheatley on the nose, and Mr Wheatley punching Mr Smith in the stomach.

The police arrived, and an ambulance was called for Mr Brown (who at that time was comatose behind a nearby movie theatre). Mr Brown was taken to hospital.

To Mr Brown's surprise, the next day when back at home, he found the receipt from the restaurant in his jacket pocket. Upon calling the restaurant to enquire about why a significant sum had been charged to his credit card, he was shocked to learn about his deeds the previous evening. He apologised to the manager and thought the matter closed.

Mr Brown's manager found out about the events of the previous Friday evening on the first day back at work. An investigation was convened to establish what had happened and Mr Brown was stood down from his duties on full pay.

Mr Brown was confronted with the allegations about his behaviour, to which he could not provide an adequate response. In fact, Mr Brown raised the allegations of drink spiking as a reason why this was the case - and laying blame with the other employees.

Mr Brown's manager proceeded to interview all of the parties who might have had knowledge about possible drink spiking. In the end that question came down to a conflict of evidence between Mr Situra and Mr Gumulia, who denied he had spiked Mr Brown's drink. On that basis the employer was unable to conclude that drink spiking had occurred.

With this conclusion made, the fate for Mr Brown was, unsurprisingly, termination of his employment.

Mr Brown brought a claim that dismissal was unjustified, suggesting that the procedure followed by the employer to dismiss him was harsh, and that his actions did not amount to serious misconduct.

The case raised a series of questions with direct implications for other office Christmas parties.

Is an off-site work Christmas party connected with employment?

Part of the question for the Australian Industrial Relations Commission was whether the work function (and actions occurring after the conclusion of a work function) provided a necessary connection with the employment relationship so that the employer could discipline Mr Brown. The judge's view was that, on the basis that the function was work-related, was funded by the employer and was attended by only employees, this provided that necessary connection. As well, it appears relevant that the conduct of the employees may have impacted upon the employer's reputation, as some restaurant patrons knew their place of work.

The judge also had no hesitation in considering Mr Brown's actions as serious misconduct - and upheld the dismissal.

The conclusion that such a Christmas party is connected to employment is likely to be the same under New Zealand law - and for exactly the same reasons. This has two natural spin-offs: an employer's duty to maintain a safe workplace remains even if the event is off-site, and that breaches of codes of conduct can trigger disciplinary action.

What to do before the party starts

Crucially for the employer in this case, however, were the actions it took before the Christmas party. In particular, the judge found that the employer had gone to some lengths to ensure that staff were aware that there were certain expectations about their behaviour. It had held at least two meetings before the party to outline this.

Outlining the standards of behaviour expected from employees (particularly where alcohol is involved) before a function of this sort is good practice - and puts staff on notice that bad behaviour could trigger disciplinary action. In the Brown case, the employer had also confirmed to employees that the policies and procedures that governed the workplace would also apply to any matters that arose from the Christmas party.

Health and safety

An employer's duty to maintain a safe workplace is slightly altered in a situation where a function is provided outside of the course of the normal employment relationship. However, it is not extinguished merely by being away from the normal worksite.

What this means is that an employer must still take all practicable steps to ensure hazards are eliminated or minimised. In practical terms, this might mean monitoring alcohol consumption and behaviour, and considering whether some element of security should be provided.

Matters arising during an investigation

Importantly, the employer in Mr Brown's case passed the allegations of drink spiking on to the police. The police looked at the allegations and, on the basis of a lack of evidence, did not proceed to lay charges against any employee. As part of his decision, the judge concluded that the employer had acted properly in investigating those allegations fully, and once completing its investigation, providing all information to the police.

The hidden dangers of Christmas parties

What this case serves to remind us of are the dangers of alcohol-fuelled antics by stressed employees at end of year functions.

An employer's obligations under health and safety legislation to maintain a safe workplace remain and, by virtue of being a "work" function, require an employer to treat matters that arise as part of an employment relationship.

Even though the employer in this case had been proactive in attempting to avoid the potential for issues to arise, some added vigilance at the party itself might have avoided the unfortunate consequences that resulted. However, the investigation that was ultimately undertaken was appropriate - and its conclusion was justified.

A little bit of Christmas cheer (but not too much) appears the way to go at a Christmas party.

For further information, please contact your usual Bell Gully adviser or:

AUCKLAND

Rob Towner
Partner

WELLINGTON

Andrew Scott-Howman
Partner

Maria Berryman
Senior Associate

Matt McGoldrick
Solicitor