Avoiding Employment Lawsuits Over the Holiday Season


I adore the holidays. The hustle, the bustle, the presents, and the cheer all make me happy. However, for the sake of this column, I will be playing the part of Scrooge as we walk through some of the employment missteps that can occur during the most wonderful time of the year.

Religious Discrimination 101   

The most obvious of the holiday season concerns we will cover is religious discrimination.  If “O Holy Night” is playing overhead and “Merry Christmas!” is in the company bulletin, then you could run afoul of Title VII. All right, that may be an exaggeration, but it is important to avoid being too pushy with the religious aspects of Christmas in a secular workplace. You might think of Title VII in the context of race or sex discrimination, but it also prohibits harassment or disparate treatment on the basis of religion. In other words, it violates Title VII to treat an applicant or employee less favorably because of his or her religious beliefs or practices – as well as the lack thereof. Title VII applies to all terms and conditions of employment. Religious harassment can include unwelcome statements or conduct based on religion that are so severe and pervasive that a reasonable individual would find the work environment to be hostile or abusive, usually referred to as hostile work environment.

What is “religion” under Title VII? It’s a broad category. It covers the “big three” in the United States – Judaism, Christianity, and Islam, along with all their sects and denominations. But it also covers religious beliefs that might be considered “fringe” and even beliefs that are sincerely held only by one person. It also includes lack of belief – agnosticism and even atheism. Any sincerely held belief about the ultimate meaning of life or death will typically be found to be a religious belief – even if it is something you personally doubt or have never heard of.

Further, like the Americans with Disabilities Act (“ADA”), Title VII can require a religious accommodation by the employer, unless it is an undue hardship on the employer (though the standard for that is lower than that for the ADA). Like the ADA, an employee must make an employer aware of the need for an accommodation in the religious context. Once a need is disclosed, the employer and employee must discuss the accommodation needed. In the context of the holidays, if – for example – a Muslim employee wants to opt out of the company holiday party for religious reasons, the employer would be expected to make that accommodation unless doing so would be an undue hardship.

The Holiday Party

Speaking of holiday parties, let’s talk about those. In a secular workplace, for the reasons we’ve just discussed, it is best to avoid overtly religious symbols, such as Nativity scenes and Menorahs, and overtly religious music. Instead, employers are better off with Santa Claus, snowmen reindeer, and snowflakes.

Another issue is how time spent at a holiday party will be compensated, if at all. If attendance at the holiday party is truly voluntary, then non-exempt employees need not be paid for time spent in attendance as guests. However, if non-exempt employees perform any work at the party (for example, setting up, serving, or cleaning up afterward), then that is work time and must be paid, even if the attendance and the work performed were done on a purely “voluntary” basis.

Employers who want attendance to be “voluntary” should clearly state in the invitation that attendance is voluntary, and then they should behave as if they mean it. Employees should not feel any job-related pressure to attend. If they do, a court is likely to find that attendance was not voluntary and therefore that the employer is required to pay employees for their time. On the other hand, if an employer is willing to pay non-exempt employees for their time spent at the party, then it may mandate attendance or “strongly encourage” it.

The compensation of exempt employees does not depend on whether attendance was voluntary or required. An exempt employee typically must be paid in full for any week in which work is performed. You cannot “dock” an exempt employee for time spent at the party, but you don’t need to pay overtime if the party occurs outside of normal work hours.

As a side note, you might not be aware that there is no federally mandated shift premium for employees who work on a holiday, though it is common practice that doubtless lifts morale.

Making the party voluntary also helps as it relates to employer liability for accidents and injury. As a host, an employer can take on certain risks related to the party. Generally speaking, an employer may face liability for employee actions if that employee is acting within the course and scope of his or her employment under the theory of respondeat superior. Recreation is within the course and scope if employees are required to attend, or if the employer endorses the event and might benefit from the event. This is a state-specific question, and courts vary on whether handling out awards or having customers attend make it an event from which the employer benefits.

Similarly, if an employee is injured at a holiday party, the applicability of a workers’ compensation statute depends on the state you are in and the specific circumstances of the injury. In some states, employees injured at a social event can recover under the statute only if the employee was being paid to attend. Other states, like California, may allow recovery if the employee was paid or required to attend the event. Thus, making the event truly voluntary is beneficial in several respects.

Further, don’t conduct work activities during the party – save training, awards, or presentations for another day. Be cautious about inviting vendors, clients, and other business connections. And by all means, don’t discipline any employee who fails to attend the party.

Employers can take other common-sense precautions to avoid other holiday party snafus. Do not schedule the event on the same day as a religious holiday. Make sure you accommodate any religious dietary restrictions. Further, consider not serving alcohol. And if you do serve it, hire an outside company to bartend. Serve lots of food to soak up the libations. Host the party off premises, and invite families.  Employees are likely to be on better behavior with spouses or significant others in attendance, which cuts down on the possibility of sexual harassment.

Sexual harassment is probably the greatest risk at company-sponsored recreational events. Sexual harassment comes in two varieties: quid pro quo harassment and hostile work environment.  In the sexual harassment context, quid pro quo usually involves a supervisor who is making a threat or a promise in exchange for a sexual favor, while hostile work environment involves unwelcome or offensive conduct that is severe and pervasive. It bears repeating that limiting or eliminating alcohol is an option that may reduce the misbehavior that leads to sexual harassment claims. Additionally, choose activities and venues carefully. Also, it doesn’t hurt to remind your employees that the regular rules still apply and to check on your insurance policy beforehand. If a complaint does arise during the party, investigate it promptly and take whatever corrective action is appropriate.

As final word, be mindful of the gifts you give. Avoid anything that could be described as containing “adult content.” I have found that gift cards and cash, while generic, tend to be popular and unproblematic.

And To All a Good Night

Though I hate to bring a bit of bah-humbug to the upcoming holiday season, keeping these tips in mind will help to ensure that the season stays merry and bright.  

This column is made available by the lawyer and publisher for educational purposes only, to give you general information and a general understanding of the law, not to provide specific legal advice or to establish an attorney-client relationship. This column should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Susan Bassford Wilson is an employment attorney in the Midwest with the nationwide firm of Constangy, Brooks, Smith & Prophete, LLP. She can be reached at [email protected] or on Twitter at

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