After-Hours Drinking: Is It Legal To Provide Employees Alcohol?

Alcohol regulations vary by state or local laws, and while alcohol can be consumed after closing times, employers may be held liable for serving it after hours. Employers may be held responsible for injuries resulting from an employee's alcohol consumption if they encouraged it. While there is no one-size-fits-all solution, a thoughtfully written policy is essential to outline when drinking is allowed and to mitigate liability. Companies should also provide training to managers on how to apply the policy and ensure employees are aware of it.

Employers' liability for alcohol-related incidents

While there are benefits to providing employees with alcohol, such as improved recruitment and retention, and better creative problem-solving abilities, there are also risks involved. Employers have a responsibility to keep employees safe and prevent sexual harassment, accidents, and injuries that may occur as a result of drinking. This responsibility extends beyond the physical workplace to off-site meetings, company retreats, and other events where alcohol is served.

If an employee is injured or injures someone after drinking at a company event, the company could be held liable under the legal theory of "respondeat superior". This means that employers are responsible for the costs of doing business, including the consequences of employee carelessness. For example, if an employee gets into a physical altercation at a company event due to severe intoxication, the employer's lack of restrictions might be seen as contributing to the incident. Similarly, if an employee is sent home from work due to intoxication and gets into a car accident, the employer could be held liable for sending the employee home without assistance.

To minimize risk, employers can implement an Alcohol at Company Events Policy that outlines restrictions on alcohol consumption and ensures a safe environment. This may include limiting the number of drinks per person, serving alcohol for a limited time, or providing drink tickets. Attendance at events should be optional and employees should be encouraged to arrange for a designated driver or use a company-provided ride-sharing service. Employers should also be mindful of the cultural environment surrounding alcohol and avoid fostering an environment that normalizes alcohol abuse.

It's important to note that state laws vary, and employers should be familiar with local regulations related to employer liability for serving alcohol. Consulting with legal counsel can help ensure compliance and mitigate liability in the event of an incident.

Industry-specific considerations

While there are potential benefits to providing alcohol to employees, such as improved recruitment and retention, stress relief, and enhanced creative problem-solving abilities, there are also significant industry-specific considerations to take into account.

Hospitality and Bartending Industry

In the hospitality and bartending industries, where the sale and service of alcohol are inherent, employers must be particularly vigilant about alcohol-related policies. While it may be tempting to provide employees with after-hours drinks to promote team bonding, employers in these industries should be aware of their potential liability. Serving alcohol to employees after hours could lead to similar liability concerns as selling it, and employers may be held responsible for any accidents or incidents that occur due to employee intoxication. This includes accidents that happen off-site or after employees have left the premises. To mitigate these risks, employers can implement measures such as providing safe rides or transportation services for employees who have been drinking.

Creative Industries

In creative industries, the benefits of team bonding over celebratory drinks can be significant. However, it is crucial to establish clear policies regarding alcohol consumption. This includes outlining when and where drinking is permitted, encouraging moderation, and emphasizing that employees should never work or drive while impaired. Creative professionals should also be mindful of the potential exclusion of employees who abstain from alcohol, ensuring that non-alcoholic options are always available and that social events are inclusive.

Transportation and Heavy Machinery Industries

In industries such as transportation, drivers, and operators of heavy machinery, the consumption of alcohol during working hours is strictly prohibited. Employers in these sectors must adhere to policies that prioritize safety and compliance with legal regulations. While employees in these fields may choose to consume alcohol after their shift ends, employers should still promote a culture of responsibility and provide resources for employees who may be struggling with substance abuse.

Healthcare and Medical Industries

Similar to the transportation and heavy machinery industries, healthcare and medical personnel are expected to refrain from consuming alcohol during work hours. Policies in these industries must emphasize patient safety and compliance with legal and ethical standards. While after-hours social events may include alcohol, employers should still be mindful of potential liability and encourage employees to consume alcohol responsibly, providing alternative options for those who abstain.

Regardless of the industry, it is essential to involve HR professionals and legal counsel when developing alcohol policies. These policies should be regularly reviewed and updated to align with evolving workplace cultures, legal requirements, and organizational values. Additionally, employers should be aware of the complex legal considerations that arise under legislation such as the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA) regarding alcohol use disorders.

Employee assistance programs

The legality of providing employees with alcohol after hours depends on the jurisdiction and the applicable state laws. In most states, it is illegal for employers to serve alcohol after specified times, and they may have just as much liability for serving it after hours as they would for selling it.

If an employer allows employees to drink at work, there is a risk of accidents on the property or off-site if employees drive home. The U.S. Department of Labor reports that 65% of on-the-job accidents are the result of drug or alcohol use, and 38-50% of workers' compensation claims are related to working while impaired. Therefore, it is essential to have a clear policy prohibiting working while impaired or outlining when alcohol consumption is permitted.

EAPs offer a range of services, including:

• Confidential and timely problem assessment services
• Referrals for appropriate diagnosis, treatment, and other assistance
• Links to workplace and community resources
• Follow-up services
• Education and information on prevention

It is important to note that if an employee enters an addiction treatment program before any disciplinary action is taken, it is unlikely that their employer will fire them. Additionally, under the Family Medical Leave Act (FMLA), employees may receive up to 12 weeks of unpaid leave to attend rehab or deal with other life events.

Compliance with state laws

While there is no explicit mention of a federal law prohibiting employers from providing alcohol to their employees after hours, compliance with state laws is crucial. Alcohol regulations vary across states and local jurisdictions, so it is essential to review the specific laws in your state. Some states may have stricter regulations than others, and serving alcohol after specified hours may be illegal in certain states. Therefore, it is important to consult legal counsel to ensure compliance with the applicable state and local laws.

When creating a company policy regarding alcohol consumption, it is vital to prioritize employee safety and well-being. Working while impaired by alcohol is a safety hazard and can put employees, their colleagues, and the company at risk. It is important to emphasize that employees should never work or operate heavy machinery while under the influence of alcohol. Additionally, providing employees with alcohol and allowing them to drive home intoxicated can create liability issues for the employer if an accident occurs. To mitigate this risk, employers can provide alternative transportation options, such as a company rideshare or driver's service.

To comply with state laws and create a safe and inclusive environment, companies should implement comprehensive alcohol policies. These policies should outline clear guidelines for alcohol consumption, including any restrictions on timing and quantity. For example, a policy may allow alcohol consumption only after 5 p.m. or limit the number of drinks provided during company events. Regular reviews and updates of the policy are essential to ensure continued compliance with evolving legal requirements and workplace culture.

In addition to state laws, employers should be aware of the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA) when creating alcohol policies. The ADA may apply to individuals with alcoholism, but it does not require employers to excuse performance issues or misconduct resulting from substance abuse. Understanding the legal considerations related to alcohol use disorders can help employers navigate compliance and fairness in their policies.

Finally, it is important to accommodate employees who abstain from alcohol use. Companies should create an inclusive environment by offering non-alcoholic options and respecting medical, religious, and personal reasons for abstaining. By involving HR and legal professionals in the policy-making process, employers can ensure that their alcohol policies are compliant, fair, and respectful of employees' diverse needs and preferences.

Monitoring for intoxication

While alcohol can be drunk after closing times, employers may have just as much liability for serving it after hours as selling it. Employers can be held liable if an employee gets into an accident after leaving the bar due to intoxication.

Managers should be aware of the signs of employee intoxication, such as bloodshot eyes, an odor of alcohol, or slurred speech. However, they should refrain from diagnosing the problem and instead document their observations. If an employee appears to be intoxicated, they can be required to meet with a supervisor to determine their condition. During this meeting, the supervisor should inform the employee of their suspicion and ask if they are under the influence of any substance. If the employee denies it, the supervisor may request their consent for an alcohol test to disprove the suspicion. If the employee refuses, the incident should be documented, and the employee should be placed on administrative leave with transportation arranged.

If an employee is found to be intoxicated, they should be removed from their work area and isolated in a designated location until they can be transported home or to a medical facility. Employers should approach the situation with compassion and provide accommodations for employees suffering from substance use disorders. This may include referring them to resources such as employee assistance programs (EAPs) or healthcare providers.

It is important to note that employers should consult with legal counsel regarding their alcohol policies to ensure compliance with state and local laws. Policies should clearly outline that working while impaired is prohibited and establish consequences for non-compliance.

Frequently asked questions