4 Rules of the New Office Holiday Party

CHICAGO (TheStreet) -- The office holiday party is a December tradition, but like many it must change with the times. While free-flowing cocktails used to be a given, today's office festivities are just as likely to be alcohol free. Back in the days of unlimited entertainment budgets, companies were considered chintzy if they didn't spring for a lavish meal for employees and spouses; now, rampant cost-cutting has made semi-formal dinner-and-dancing parties an endangered species.

So what are the new rules of the office party? When small businesses are performing a cost-benefit analysis on practically every penny of spending, can they justify the expense of an annual office bash?

With office-party season in full swing, here are the key issues small-business owners should keep in mind when it comes to holiday celebrations:

1. DO ask your staff
While holiday parties can be a good way to reward employees with some free food and time off work, they aren't necessarily the best use of your money. After all, some offices are more social than others. The best way to assess whether a party makes sense for your particular group of workers is to ask them.

It's something that happens all too rarely. In the vast majority of cases, workers are simply informed about the party rather than being active participants in the planning.

If the general consensus is that employees would rather not have a party, owners or managers can still spread some holiday joy by calculating what the cost of a party would have been, then divvying up that money as bonuses instead.

2. DON'T play bartender
The mild-mannered co-worker who shocks everyone by letting loose at the office party has been a running joke for decades. But the role of alcohol in end-of-year celebrations is one of the trickiest issues company owners and managers must navigate. One increasingly common solution is to schedule a lunch party at which alcohol is simply not on the menu.

If drinks are a must-have element at your company's parties, the most important thing is to limit potential liability. "A business can be sued if an employee drives drunk and has an accident," says human resources consultant Ann Novak, of AP Novak & Associates in Washington, D.C. "If you hire a professional bartender, he or she will have a license and be trained when to tell someone they've had enough to drink."

Sexual harassment is another liability issue that can come up when the drinks start flowing, Novak says. Remind employees in advance that all work policies apply during the event, and have an action plan in place for handling employees who begin to behave inappropriately.

3. DO Promote Teambuilding
Anyone can book a space, order food and call it a party. But unless you have a naturally outgoing, festive bunch of workers, getting everyone involved and interacting can be a challenge.

Enter the activity party, an event built around a shared experience or challenge (think of it as a lower-key, December version of an Outward Bound ropes course). In Los Angeles, party-planning company Dial M Productions stages game shows ( Is Your Team Smarter than a 5th Grader?), customized versions of The Apprentice (complete with Donald Trump impersonator) and a Corporate Singing Workshop in which teams compete to write the best company theme song. Parties That Cook, which has locations in San Francisco, Chicago, Portland, Ore., and Seattle, organizes events that split co-workers into teams to prepare multicourse meals or compete in Iron Chef-style showdowns.

While many small businesses don't have the budget to hire a full-service event planner, they can still take advantage of this trend by thinking creatively. Incorporating an interactive element -- anything from wine tasting to trivia contests -- is an easy way to put people at ease and spark conversation.

"Hopefully, you'll get to know something new about each other," Novak says. "The party should open the door for team building."

4. DO Channel Santa
At a private party, the host is responsible for making guests feel at home and maintaining an upbeat, welcoming energy. At the office holiday party, that duty falls to the boss.

Employees take their cues from above, so a business owner must project an aura of good cheer if they expect others to make merry. While few business owners these days have the extra cash to hand out bonuses, gift cards to local restaurants or stores are an easy, relatively affordable way to spread the holiday spirit.

"The party should be a time when you're enjoying each other's company and celebrating what you've accomplished together," Novak says. "Holiday parties are great for staff appreciation, but actually showing that appreciation throughout the year is what's most important."

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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