Think before you party

Christmas is an expensive time for employers, as theCity law firm Nabarro Nathanson knows only too well. It was at one of the firm's Christmas parties that Donna Van Den Berghen, a secretary, claimed her boss had touched her breasts and given her a bear-hug. The party apparently degenerated into a "bunfight" in which, said Ms Van Den Berghen, her boss proceeded to consume a seven-inch chocolate penis covered with cream.

When the secretary complained, she was dismissed. She was awarded £4,700 by an industrial tribunal by way of compensation and damage for injury to feelings after claiming sexual discrimination.

According to a survey by Reed Personnel Services, 81 per cent of employers are having parties this year and 57 per cent of employers interviewed expect more free drinks than last year. The potential exists for trouble.

As the employer usually picks, and pays for, the venue, the office party will, usually for legal purposes, qualify as the workplace. This means the employer's neck could be on the line if sexual harassment occurs among the workforce. More and more employers are taking such behaviour seriously since a recent survey of more than 1,700 employers by Industrial Society showed that more that half of working women are victims of sexual harassment.

Sexual harassment takes various forms: unwelcome attention, suggestive and over-familiar behaviour, or suggestions that sexual favours may further career prospects. Employees get some protection under statute and the EC Equal Treatment Directive. Yet ha r assment is not defined in the Sex Discrimination Act. An aggrieved employee must show less favourable treatment ongrounds of sex.

A Court of Appeal case established that a woman who complained of sexual harassment had suffered unlawful discrimination on the grounds of sex. Under the Sex Discrimination Act, the employee must show that the harassment has caused a detriment such as choosing to resign, seeking a transfer or dismissal.

In such cases employers arevicariously liable for their employees' actions - even when the incident occurred without the employer's knowledge or approval. An employer can only escape liability by showing that reasonable steps were taken to avoid harassment taking place.

The European Commission and the Department of Employment have produced codes to address the problem. The DFE says that "a policy of sexual harassment should be a normal part of good personnel and resource management". It stresses the importance of detailing harassment, establishing a complaints procedure and ensuring that policy is implemented and communicated to all employees. It also emphasises the need for training to identify harassment and to monitor preventive policies.

Sex discrimination claims are heard in the industrial tribunal. Claims in respect of harassment must be submitted usually within three months of the alleged incident. Until earlier this year, the tribunals' power to make awards was restricted to £11,000.The power now exists to make unlimited awards.

Employees who are sexually harassed may also have claims for breach of contract if they feel compelled to resign because the employer fails to adequately investigate a complaint. A resignation in these cases will be treated as a de facto resignation.

Once employers are satisfied they have minimised the risk of sexual harassment, there is only liability for damage caused at the venue to worry about - plus any injury to other employees or guests if a fight occurs. It is also better not to forget the criminal offence of aiding and abetting a criminal offence. Encouraging those to drink who you know should not does entail a risk.

Take the case of the landlord who was convicted because he continued to serve a customer who was clearly over the limit and incapable of driving home.

Maybe it's not too late to cancel that party after all.