When the Party Becomes the Workplace: Employer Responsibilities Beyond the Office

Workplace celebrations and off-site events are an important part of building workplace culture. They provide a chance to recognise achievements, strengthen team relationships and enjoy a break from the daily routine. Yet beneath the festive spirit lies a serious legal question: when does a social gathering also become the workplace?

Australian courts have made it clear that an employer’s duty of care does not end when staff step out of the office. If the event is organised, sanctioned or funded by the employer, then the employer’s workplace duties can often follow. That means workplace policies, occupational health and safety obligations, and codes of conduct can often continue to apply. Employers who treat these occasions too casually risk finding themselves accountable for misconduct, injuries or harassment that occur long after the last drink has been poured.

Why the Law Extends Beyond the Office

The rationale is straightforward, an employee’s work environment is defined not by bricks and mortar but by the employer’s control over a particular setting. When staff are gathered at a company sponsored function, whether it is a Christmas party, client dinner or team-building retreat, the employer has created the setting and therefore assumes a degree of responsibility for the conduct, safety, and wellbeing of employees within that environment. The Courts have repeatedly emphasised that this connection brings with it responsibility. In one case, an after party hosted by a director at his home was held to be a continuation of the workplace event, meaning the employer bore responsibility for injuries sustained there.

Alcohol and Supervision: The Most Common Pitfalls

Perhaps unsurprisingly, alcohol features prominently in disputes arising from workplace functions. Generous bar tabs and limited oversight have been central in a number of cases, including the well-known Keenan v Leighton Boral Amey NSW Pty Ltd [2015] FWC 3156. While the Fair Work Commission (the Commission) found that the employee’s behaviour was unacceptable, the Commission also noted that unlimited alcohol and a lack of supervision undermined the employer’s position. The lesson is clear: providing alcohol on an unlimited and unsupervised basis can create foreseeable risks, and employers must take active steps to manage them. This includes offering non-alcoholic options, setting limits on service, and ensuring senior staff are visibly supervising.

Where Work Ends and Misconduct Begins: The Legal Boundary

Not every out of hours incident justifies disciplinary action. The law draws a line between behaviour that is truly private and behaviour that has a sufficient nexus to employment.

In Rose v Telstra Corporation Limited (1998) AIRC 1592 (Rose), two employees had been drinking at a hotel during a work trip when a physical altercation between them broke out. One employee was dismissed, but the Commission found the dismissal to be unfair on the basis that it was harsh. The incident occurred well outside the workplace, did not damage Telstra’s reputation, and had no meaningful impact on the employment relationship. The case stands for the principle that employers cannot simply rely on “out-of-hours misconduct” unless there is a demonstrable connection to work.

By contrast, in Fox v Allianz Australia Services Pty Ltd [2006] AIRC 22, an employee became heavily intoxicated at a work function and behaved in a way that was sexually inappropriate toward colleagues. The Commission found that the misconduct directly undermined the trust and confidence essential to the employment relationship. Unlike Rose, the behaviour occurred at a work-related event, involved other employees, and created risks for Allianz’s reputation. The termination was upheld as a valid and proportionate response.

Taken together, these cases illustrate the nuance that exists in these matters. Employers must carefully assess whether off-site behaviour impacts the workplace, considering factors such as whether the conduct occurred at a work-related event, whether it involved colleagues or clients, and whether it damaged the trust central to the employment relationship.

How Employers Can Stay Protected: Setting Clear Boundaries and Expectations

Preparation is the most effective safeguard. Clear communication before the event, reminding staff that workplace policies remain in force, sets expectations early. Employers should also define the boundaries of the function, making it clear when an event officially ends so that any subsequent private gatherings fall outside the company’s responsibility. On the day, visible supervision helps to discourage misconduct and allows issues to be addressed promptly. After the event, any complaints should be managed in line with internal procedures, with a fair investigation and a proportionate response.

More Than a Party: Protecting Culture, Safety and Brand Reputation

Ultimately, off site functions are an extension of a company’s culture. A well-managed event demonstrates care for employee wellbeing and helps foster trust. Poorly managed functions, by contrast, can expose businesses to legal claims, reputational harm and workplace division. Employers who approach these occasions with the same diligence as any other workplace activity not only mitigate risk but also set the tone for a respectful and enjoyable culture.

Turning Celebrations into Safe Successes

Workplace events that occur outside the office are not simply social occasions. They are moments where the workplace follows the employee into a different setting, and where the employer’s obligations remain. With thoughtful planning, clear communication and careful supervision, employers can ensure that celebrations remain memorable for the right reasons, as well as safe, inclusive and reflective of the organisation’s values.

The content in this Article is intended only to provide a summary and general overview on matters of interest. It is not intended to be comprehensive nor does it constitute legal advice. It should not be relied upon as such. You should seek legal or other professional advice before acting or relying on any of the content.

The solicitors at BlackBay Lawyers can provide specialised and detailed advice for employers and employees. If you require advice, please feel free to contact BlackBay Lawyers on (02) 8005 3077 or via www.blackbaylawyers.com.au  for a confidential discussion with one of our solicitors.

ABOUT THE AUTHOR

Olivia Gebron, is an associate and an enthusiastic, committed member of our team. With a genuine passion for helping clients navigate complex legal disputes, she brings a clear and strategic mindset to every matter. Olivia takes pride in understanding each client’s unique circumstances, allowing her to deliver tailored solutions with confidence and clarity.