Special events such as parties, team-building activities or sporting events can help build relationships and make the workplace more fun.

But what happens if someone is injured at the holiday party or while participating in a team-building outing? Would they receive workers’ compensation benefits?

There’s no clear-cut answer, and case law differs somewhat by state.

Typically, an injury sustained in an activity that is truly voluntary is not compensable. But if the employee is encouraged or required to participate, or the company benefits from the participation in some way, it could be.

If the activity takes place on your premises, during work hours, or both, these factors could make an injury at the event more likely to be compensable.

Legal guidance by state

In some states, established case law provides some guidance on whether injuries at special work events are compensable.

Minnesota

The Minnesota Supreme Court addressed this issue in 2016, ruling that the activity must be voluntary for the employer not to be liable. The activity is not considered voluntary if this hasn’t been clearly communicated to the employee, and if there are any negative consequences for not participating. For example, if the employee had to take vacation time or would be viewed negatively from a job performance standpoint for not participating, these would be considered negative consequences and the activity wouldn’t be considered voluntary.

Iowa

In Iowa, the court looks at whether the employer received a “substantial direct benefit” from the employee’s participation to determine whether an injury was work-related. A large factor in compensability is determining whether the employee was required or expected to participate. Even if an event was technically voluntary, if it was held during working hours on the employer’s premises and participation was encouraged, it could be compensable.

Wisconsin

In Wisconsin, injuries at special events are compensable when one of the following is met:

• The activity is on the employer’s premise
• The employer expressly or implicitly requires participation
• The employer receives substantial and direct benefit from the activity beyond improvement in employee health and morale

South Dakota and Nebraska

South Dakota and Nebraska don’t have any specific laws or guidelines in place, but considerations about whether an activity was truly voluntary would likely come into play in these states as well.

No matter which state you’re in, it’s worth spending some time thinking through any special events that you’re planning. Ask yourself about the safety risks, and whether your employees will feel it’s voluntary. This can help you make better decisions about the types of special events you offer, and how you communicate about them. ■

Prepared by the attorneys at Lynn, Scharfenberg and Hollick.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.