A company hosts an event at your establishment and alcohol is served. One of the attendees overindulges, gets in his or her car, and drives straight into oncoming traffic on the highway, killing a family of four. The surviving relatives sue for damages, naming everyone connected to the event in the suit, including your facility. How do you avoid a tragedy such as this?
When it comes to liquor sales, every brewpub, winery, hotel, restaurant, lounge, and hospitality establishment must follow state and federal laws. Because laws differ from state to state, businesses must follow regional liquor laws.
Intent of the Law
The Dram Shop Act is intended to place responsibility for damages caused by intoxicants on those who profit from the sale of alcohol. And to protect the health, safety, and welfare of the people from the dangers of traffic in liquor. The term “Dram Shop” comes from the 18th century businesses in England that sold gin by the spoonful, called a dram. Dram shop laws hold retail and hospitality establishments accountable for any harm—death, injury, or other damages—caused by an intoxicated patron.
Each establishment must be licensed to sell and serve alcohol. Licenses should be renewed and displayed appropriately. Display proper signage. Signs displaying responsible drinking information, the establishment’s policies, and all legal information must be clearly posted.
Make Sure Your Vendors are Licensed and Insured
If you hire a vendor to sell or serve alcohol for your event, make sure the vendor is compliant with state and local licensing and insurance regulations.
Do background checks, run motor vehicle reports and check references on new hires to determine whether any offenses apply, including past alcohol offenses and previous serving responsibilities.
Ensure Employee Training
All employees who serve alcoholic beverages must successfully complete an alcohol server training course before serving. Different states
may have different laws or recognize various
other agencies or sources or training/certification. Maintain training records, including copies of certificates of the training and date completed for each employee. Ensure that all employees complete training within the time frames by the certificate.
Critical parts of alcohol server training include:
• Checking customer ID and recognizing false ID.
• Recognizing when someone appears to be purchasing alcohol for minors.
• Recognizing signs of intoxication or alcohol impairment.
• Identifying situations that are likely to escalate or lead to extreme intoxication.
• Diplomatically refusing to sell to minors and intoxicated persons, and identifying when circumstances are questionable.
Basic Serving Policies Include:
Alcoholic beverages may not be served at any time by any employee or manager of an insured employee to any individual who is under 21 years of age; who shows signs of being intoxicated; or who is at a point of being likely to become intoxicated.
Consumption of alcoholic beverages by any em- ployee or manager while working is not permitted.
Service of alcoholic beverages by a server who is intoxicated is prohibited.
To avoid incidents, employees should provide:
• Nonalcoholic drinks and food.
• A telephone for contacting a taxi service if a customer is too intoxicated to drive.
Keep a log whenever any of the following occur:
• Identification is not accepted.
• Service is refused or stopped.
• When alternative transportation is offered.
• Any violent action by anyone.
• When police are called to come to the premises.
• Any situation where the manager believes a record may be of value for future reference.
The principles contained in this material are general and, to the best of our knowledge, current at the time of publication. Ross & Associates Insurance Services Inc. specifically disclaims all liability for damages or personal injury alleged to arise from reliance on the information contained in this article.
Jason Jordan is a licensed property & casualty insurance agent at Ross & Associates Insurance Services Inc., in Portland. Contact him at firstname.lastname@example.org.