HR Management & Compliance

Should You Have an Employee Holiday Party?

As we near the end of the year, many organizations are gearing up for their annual holiday party. But others are not sure it’s the right choice or may be considering ending a long tradition.

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Let’s take a look at some of the arguments for and against sponsoring holiday parties for employees.

Reasons Employers Choose to Have Holiday Parties

Here are some of the arguments for having a holiday party for employees. A holiday party:

  • Maybe something employees enjoy, and be a way to show employees they’re valued. It can help to bolster good mood and good will.
  • Could be a good opportunity for team bonding and for people to get to know others they work less closely with.
  • Could be a great way to give employees a treat.
  • Can be a signal to employees that the organization is doing well and the future is bright, which can ease concerns.
  • Can be a way to reinforce the company culture and values.
  • Can be used to enhance or promote the organization’s employment brand. By promoting the culture that values downtime and celebration, you’re contributing to how the organization is viewed by others. This is especially true if holiday parties are shared somewhere public, like the organization’s social media pages.

Reasons Employers Choose NOT to Have Holiday Parties

Here are some of the arguments against having a holiday party. A holiday party:

  • May increase the potential for workplace harassment to occur, because people have let their guard down and will have more of an opportunity to say or do inappropriate things, especially if alcohol is involved. They may not see this as an extension of the workplace, but it is.
  • Will have costs involved, which can add up quickly. Additionally, even if the budget is there, employees may not appreciate it. Even though this is a benefit for employees, it may be resented as it could be seen as a frivolous waste of money that could have been used on raises.
  • May be seen as an obligation. Many employees don’t want to go and will be frustrated at what feels like an obligation, even if attendance is truly optional. This is compounded when circumstances make attendance difficult, like the need to find a babysitter or to arrange for care for elderly parents or travel a long distance.
  • Could cause frustration if not easy to attend. Some employees may be unable to attend and may be frustrated because it may seem they’ll be missing opportunities for networking or advancement by the absence.
  • Could increase liability. Situations that often occur at office parties, such as consuming alcohol, can present significant liability issues for the organization to mitigate—and not just harassment as noted above. Even without alcohol, the organization may be introducing additional liability, which the employer’s insurance may or may not cover. Workers’ compensation may or may not cover injuries, for example, depending on the details. Be sure to check in advance what is covered!
  • Can create unnecessary problems. People may read more into the party than you expect. For example, there may be resentments at seating, required attire, food options provided or not provided (such as those that meet dietary preferences or restrictions), food allergies, location choice, whether smoking is allowed, emphasis on a particular religion or holiday over others, etc. Employees may read into the situation something the employer may not have intended.

If you’re going to have an event, consider holding it during paid work hours, without alcohol, to minimize the negatives noted above. This will minimize if not eliminate the frustrations related to feeling obligated to attend and will reduce the likelihood of employee misconduct or additional liability issues. Or you could set aside the money it would take to throw the party and just give it directly to employees as a bonus instead.