NEW CASE: New Risk for Oregon Employers Encouraging Alcohol at After Work Gatherings

The Oregon Supreme Court recently held that the “social host” exemption that protects servers and bartenders from claims against them does not protect employers from other possible negligent acts related to events where alcohol is present.

In the case of Schutz v. La Costita III, Inc., 364 Or. 536 (March 14, 2019), the plaintiff filed claims against the restaurant that served her drinks, the supervisor who encouraged her to drink, and against her employer who she claimed did not adequately train the supervisor on appropriate team building events.

The Plaintiff, Ashley Schultz, claims that her supervisor regularly pressured workers to attend after work events where alcohol was involved. Fearing that she would not advance in the company if she did not participate in one of these events, Schultz finally decided that she would attend after numerous requests. During the event, the supervisor encouraged more drinking and was critical of employees who did not drink enough. Ashley wanted to please her supervisor, but in doing so became intoxicated. When she left the restaurant to return home, she got into a car accident which caused her serious injuries.

Schultz’s claim against the restaurant was because they served her drinks after she was clearly intoxicated.  This claim against the restaurant was dismissed because the restaurant had explicit immunity from suits of this nature under the social host statute. However, the claims against the supervisor and the employer were not as quickly dismissed. The social host statute extends to anyone acting as the host who serves alcohol to another party, even if that party is visibly intoxicated, but does not necessarily cover liability for alleged tortious conduct committed while acting in a different role than a social host.

The court stated, “a server or social host is immune from liability only when alleged to be acting as a server or social host or also when alleged to be acting in another role, such as property owner or employer.” Further, they went on to opine that the social host statute would not preclude claims for negligent acts in roles that were outside that of a social host. Therefore, the employer and the supervisor, in this case, are not entirely immune from this claim.

After this finding, the plaintiff amended her complaint against the employer and the supervisor by stating that they had been negligent outside of the social host statute when they pressured her to attend the event, knowingly provided excessive amounts of alcohol, and did not warn her that she was expected to drink excessive amounts of alcohol. The Plaintiff also argued that the social host statute was unconstitutional.

The court dismissed the claim that the social host statute was unconstitutional but ruled that there could be a distinction between those who serve as social hosts and those who are involved in the incident who were in different roles. Those differing roles would not be granted immunity as social hosts. This does not mean that the defendants, in this case, are liable for the plaintiff’s accident, but it does say that they are not immune from possible liability for their tortious acts in their roles as supervisor and employer.

While the employer and supervisor have not yet been held liable for Schultz’s accident, this ruling opens the door for potential risk to other companies that have events such as this. Employers should proceed with caution when arranging events where alcohol is involved and realize that they cannot automatically assume they will be immune from all possible liability.