By: Mallorie Milord, Associate, Miami
The holiday season is always a time that brings people in the workplace together. Whether your office is hosting a potluck holiday party at the office, at a co-worker’s house, or at a nice restaurant, it’s bound to be a good time. The last thing on anyone’s mind is an employee injuring themselves at a holiday function, but things happen, especially when there’s eggnog involved. With all things considered, an injury occurring at a social event and whether or not it’s compensable is often a question.
The Florida case that set the tone for the direction in which compensability can be determined for a holiday function, e.g. a “social event,” is Sterling v. Mike Brown, Inc., 580 So. 2d 832 (Fla. 1st DCA 1991). In this case, the Employer closed the business for the afternoon to have a Christmas party for the employees. An employee, Walter Sterling, became noticeably intoxicated. A co-worker offered to drive Sterling home and Sterling became angry and shoved the co-worker, who in turn punched him in the face. Sterling fell backwards and struck his head on a concrete floor, suffering severe injuries.
The Brockman three prong test (established in 1983 and used to decide whether recreational or social activities were deemed compensable) was used to determine compensability.
(1): The Accident must occur on the premises during a lunch or recreation period as a regular incident of the employment. In Sterling, even though the party occurred on the company property, the employer closed the business for the day. In addition, the employees did not view the company Christmas party as any kind of fringe benefit or regular incident or the employment.
(2): The employer, by expressly or impliedly requiring participation, or by making the activity part of the services of an employee, brings the activity in the orbit of employment. In Sterling, there was no attendance requirement and the employees testified that they had no obligation and felt no compulsion to attend.
(3): The Employer must derive substantial direct benefit from the activity beyond the intangible value of improvement in employee health and morale that is common to all kind of recreation and social life. In Sterling, there was no evidence that revealed this direct benefit in having this Christmas party. With this lack of evidence, the Court held that it could be implied that the sole purpose was to improve employee morale. Other factors considered were that the employer did not invite any customers, attempt to deduct the cost of the party as a business expense, or use the opportunity to make speeches, present awards, or conduct business.
If you haven’t guessed already, the Court held that the injury was not compensable for failing to meet any of the three prongs of the test.
However, legislature changes have since become even more restrictive. Whereas in the Brockman test, one prong had to be met to find compensability; Fla. Statute 440.092(1) established that recreational or social activities are not compensable regardless of any circumstance, unless such activities are expressly required incident of employment AND produce a substantial direct benefit to the employer beyond improvement in employee health and morale that is common to all kinds of recreation and social life. Also, if the first prong in the Brockman test is met, the injury can still be deemed compensable.
It is important to keep these key factors and questions in mind:
- Location of the event: Is the event being held during a lunch or recreation period as part of an employment? If the holiday event being held is in the lunch room, the Court may deem injuries arising from any accident during this time, as compensable.
- Express requirement to attend the event: Even if the holiday party is off premises, are the employees expressly required to attend? Are they to receive pay or benefits for attending? Are attendance records being kept? Are they required to work if they do not attend the event?
- Substantial direct benefit received by the employer beyond employee health and moral: Are customers/clients invited? Are speeches or awards given? Are there any promotions or marketing efforts being done?
If your answer to any of these questions is yes, compensability of the injury is likely.