Insights / November 16th, 2023

The Risk Is Up This Year - Don't Let the Grinch Ruin Your Business Plans This Holiday Season

The holiday season is just around the corner, and businesses are gearing up for the annual office Christmas party.  If you think your business is immune from inappropriate Christmas behaviour and other hangovers, think again.

While it's a time for celebration, camaraderie, and a good laugh, you can’t blame the Grinch if your business hasn’t implemented (at least) the basic measures to combat the hazards lurking in your workplace.

So put on your Santa hat as we delve into the challenges that businesses face during the Christmas and New Year shutdown period and provide practical tips to prevent Christmas party incidents, such as sexual harassment or other messy fallout.

The Dilemma: Balancing Fun And Responsibility

Christmas parties are the gift that keep on giving to lawyers.  Each year, businesses host their employees in an end-of-year party with the best of intentions but not always with a plan to match.

 Are we talking about the ‘Fun Police’?  Maybe, but your employees will ultimately thank you for implementing measures that ensure their health, safety and general all-around wellbeing.

A combination of some or all of the following will mitigate against the hazards and risks that we see year on year coming out of end-of-year parties and occasions:

  • Christmas is CANCELLED: This is not a serious recommendation! However, some businesses should consider this if they haven’t substantially addressed the points raised below.

  • Policies: Clear policies to set standards of conduct and ramifications for breaches, see the communication point below,

  • Training: Ensure employees have been properly inducted and trained in relation to the policies and expected conduct in the workplace – yes, this extends to work functions!

  • Planning: Make sure that:

    ► alcohol is to be accompanied with food;

    ► you give careful consideration to the monitoring (nominated senior staff) and/or limitation of alcohol supply/intake. Tip: drink tokens and limited bar tabs can work;

    ► you take a risk management approach to any venues you are hosting the party at noting that risk assessments should not be left to site owners, occupiers, or controllers; and

    ► you consider whether work supplied/funded/organised transport should be provided (while it can be an added cost, it is ultimately a small cost in the broader human and commercial cost that flows from end-of-year events, when things go wrong).

  • Communication: Communicate with employees about:

    ► responsible drinking (moderation, food accompaniment etc);

    ► respectful conduct towards colleagues and members of the public; and

    ► acceptable behaviour, emphasising compliance with company policies regarding harassment, drugs, alcohol, and safety.

The Workplace Whereabouts: The Pub, The Restaurant, All Work Related

Over the years, various decisions of various Courts around Australia have found that the liability of businesses for the conduct of, or damage done to, workers, at work related functions, such as Christmas Parties, is going to be considered as having occurred ‘at work’ or in the ‘workplace’.

The definition of ‘workplace’ in the Sex Discrimination Act 1984 has now been changed to adopt the more expansive definition of ‘workplace’ as it is defined in the Work Health and Safety Act (Cth). This can only mean that the risks (both health and safety, and liability) for employers involve a more expansive range of circumstances where its employees may stray from what are often considered ‘accepted’ standards of conduct in society.

Example #1 – In Ewin v Vergara (No 3)1, the complainant (Ms Ewin) was successful in arguing that a contractor’s (Mr Vergara) sexual harassment of her in a taxi, at a hotel and on the street, was still part of the ‘workplace’ for the purposes of the legislation (as it was at the time).

Example #2 - In John Keron v Westpac Banking Corporation2, a long-standing manager (with 35 years service) was sacked for breaching the sexual harassment policy at an optional networking session (after a work-related training session) at a bar where drinks were supplied by the employer.  The sacking was upheld despite the claims that the conduct occurred outside the workplace.

Example #3 - In Applicant v Employer3, it was held that termination of an employee for conduct that occurred after hours at a hotel, where there were allegations of sexual harassment, was valid. The dismissal was held to be valid, and the conduct sufficiently connected due to the fact that the employee was at the hotel because of his employment, the employer had organised and was paying for him to be at the hotel.  It was also accepted that the circumstances gave rise to the potential for damage to the employer’s reputation.


The legislation has for many years included the requirement that, in order to avoid being held liable for the unlawful acts of an employee or agent, an employer must demonstrate that it has taken ‘all reasonable steps to prevent the employee or agent from …’ sexually harassing another person.

For example, in Von Schoeler v Allen Taylor and Company Ltd Trading as Boral Timber (No 2)4 the Full Court of the Federal Court of Australia held that an employer must exercise all steps that are reasonable to take.  This is done by taking into account the whole of the circumstances, including the size of the organisation, the nature of its workforce, the conditions under which the work is carried out and any history of unlawful discrimination or sexual harassment.  In this case, the Full Court did not consider the production of a policy and some training slides to be enough for the employer to demonstrate it had taken all reasonable steps.

Get Ready For Sexual Harassment Changes From 12 December 2023

The Honourable Tony Burke, Minister for Industrial Relations delivered the Anti-Discrimination and Human Rights Legislation (Respect at Work) Bill along with the Fair Work Legislation Amendment (Protecting Worker Entitlements) Bill 2023 that resulted in significant changes to the Fair Work Act 2009 and the Sex Discrimination Act 1984 and related legislation.

The changes included a legal obligation, a ‘positive duty’, on businesses to now take all reasonable and proportionate steps, and implement such measures, as are necessary to eliminate the following types of conduct in the workplace:

  • sexual harassment

  • sex-based harassment

  • a working environment that is hostile on the grounds of sex

  • discrimination on the grounds of sex

  • related acts of victimisation.

Employers have had this obligation since 12 December 2022 (yes last year). 

From 12 December 2023, the Australian Human Rights Commission has the power to investigate and may:

  • investigate suspected non-compliance with the positive duty

  • provide recommendations to achieve compliance

  • issue a compliance notice specifying action that an organisation or business must take, or refrain from taking, to address any non-compliance

  • seek a Court order to compel an employer to do certain things to address the risk

  • issue notices for the production of information and documents (like subpoenas)

What Do We Do Now?

If you haven’t attended to the necessary process for assessing the hazards and risk, you need to move quickly now to undertake this process (on this side of any end of year celebrations you might have planned).

What we see is that many businesses take the approach of implementing a policy and putting it away till an incident occurs or they feel like they need an update.  The process of adequately addressing the obligations your business has now (in view of the above law changes), will involve more than a one-time update to your policies.  It may require a cultural transformation and complete change of mindset.  Sadly, some business ‘leaders’ and owners will ultimately not do anything until something very serious occurs.  Of course, it is too late if you wait till an incident occurs.

For the purposes of meeting the new (and reasonably new) obligations above, employers must accept that sexual harassment is primarily a work health and safety matter, and:

  • take a risk based approach;

  • be proactive in the approach;

  • conduct an expansive risk assessment and consultation process with workers;

  • determine appropriate control measures, and in doing so, consider:

    ► when, where and how hazards/risks may arise;

    ► who may engage in conduct that may arise (including third parties);

    ► consider how long a person is exposed to any identified hazard/risk;

    ► how often a person is exposed to the risk; and

    ► the level of seriousness of the risks identified.

It's crucial to strike a balance between having fun and ensuring a responsible and safe environment. With the right approach and careful planning, you can enjoy the holiday season.

We’re here to help you. If you need advice or have any questions on your current policies and procedures, contact our employment law specialists Joe Murphy and Zoe McQuillan.

1 [2013] FCA 1311

2 [2022] FWC 221

3 [2015] FWC 506

4 [2020] FCAFC 13

This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice. You should not act upon the information contained in this publication without obtaining specific professional legal advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.