Ahhhh, office holiday party season is here–the afternoon “Out of Office” message goes on, the festive attire comes out and the drinks start flowing. The office holiday party is the perfect opportunity for employers to thank employees for their contributions over the last year, to bond and relax during the holiday season. It’s also the perfect time for a lawsuit.

So it is critically important that companies are protected against what could be an HR nightmare. Since many companies are currently planning their 2017 holiday parties, we wanted to find out the laws behind corporate holiday parties. Inside Counsel sat down with Tom Mintern, associate in the international HR services group of Bird & Bird UK, to discuss how companies can avoid any legal HR headaches.

“Companies should be mindful that, notwithstanding the festive spirit in the office, December is still a normal working month and the usual risks of a claim from an employee are not only still present, but perhaps more prevalent,” he explained. “However, with a glass quickly turning into a bottle, the party can be a recipe for disaster that creates consequences extending far beyond the next-day hangover.”

An employer is responsible for the actions of employees toward each other which covers both normal working time and work-organized events. If an incident has occurred and a complaint has been made, employers should deal with it fairly and swiftly and never dismiss a complaint. Investigations should be conducted professionally, thoroughly and quickly, as failure to do so could result in a complaint against the company.

This time of year, one of the primary reasons that a company can get into trouble is because of the “extension of the workplace” concept, according to Mintern. Whether the holiday party takes place in the office or not, it is considered to be an extension of the workplace, and this means that employers can be held liable for any incidents that occur. In fact, case law in this area has suggested that, unless the incident stems from an independent, voluntary and discreet event of a different nature to the company-organized party, the “extension of the workplace” concept will apply and an employer will almost certainly be held vicariously liable.

With this in mind, are corporate holiday parties like in the movie Office Christmas Party even possible?

“For good and for bad reasons, experience has told us that most things are possible at the office Christmas party, whether it be the risqué choice of clothing, brash employee interaction or over-indulging at the free bar,” he explained. “That said, none of our clients to date have reported to us that they had a white horse, reindeer or an ice ‘slip and slide’ at their party!”

If a company were to have a holiday party like the outrageous one shown in Office Christmas Party, aside from the individual criminal liability an employee may face, the main legal implication is that it is held vicariously liable for the actions of its employees. Mintern and his team would advise that employers provide all employees with a gentle, but clear, reminder that the party is an extension of the workplace and that inappropriate behavior and unwanted conduct will be dealt with in the same way it would if it took place during work hours. Not to mention, there are also public relations risks that the company should carefully mange to ensure that its reputation remains intact.

There are a lot of things for employers to consider when planning the office holiday party. Office celebrations must be nondiscriminatory, and this can relate to anything from the theme of the party to the timing of the event. And, food and drink options should take vegetarian and vegan requirements into account, as well as religious beliefs on the consumption of alcohol. Additionally, employers should avoid clashes with other religious holiday dates such as Hanukkah or the Islamic New Year.

Mintern shared a five-point guide highlighting the steps that can be taken to help avoid any legal headaches. First, whether the party takes place in the office or not, it will be an extension of the workplace, and this means that employers can be held vicariously liable for any incidents that occur. Given the potentially far-reaching consequences, aside from details such as dress code, time and venue, employers should provide employees with a gentle reminder that the Christmas party is an extension of the workplace and that inappropriate behavior, unwanted conduct and unorthodox use of company property will be dealt with in the same way it would as if it took place during work hours.

Second, avoid discrimination as it is vital to take everyone’s needs into account from the theme of the party to the timing of the event. Third, while it’s hard to stop employees over-indulging, limiting the amount of alcohol at the party, providing nonalcoholic options and supplying enough food can all help minimize the risk of employee misconduct.

Fourth, this may also be a good time for employers to revisit policies and procedures to ensure that the business is covered in the event of serious incidents. Employees should be reminded of current employer policies and should be made aware that the business has a clear disciplinary and grievance policy. And lastly, an employer is responsible for the actions of employees towards each other. If an incident has occurred and a complaint has been made, employers should deal with it fairly and swiftly.

Amanda G. Ciccatelli is a Freelance Journalist for Corporate Counsel and InsideCounsel, where she covers intellectual property, legal technology, patent litigation, cybersecurity, innovation and more.