When Accidents Occur During Company-Sponsored Recreational Activities

Many employers provide their employees with opportunities for recreation and socializing
with their fellow workers. The purposes of such activities vary and may include goals such
as increased camaraderie among workers or increased goodwill within the business
community.

However, at what point does an injury during a recreational event give rise to a workers’
compensation claim?

According to the law (La.R.S. 23:1031A), an injury is compensable as a workers’
compensation claim if it is the result of “an accident arising out of and in the course of …
employment.” In applying this rule to recreational activities, the Louisiana Supreme Court, in Jackson v.
American Ins. Co., stated that three factors must be considered in determining whether a
recreational activity is work-related.

(1) The extent to which employee attendance is expected or mandatory
(2) The benefit received by the employer from the activity which gave rise to the injury
(3) The time and place relationship between the risk of the injury and the employment
(Malveaux v. American Manufacturing Co.).

The Supreme Court used these factors to determine whether or not a swimming accident
gave rise to a workers’ compensation claim against a federally funded, ‘make-work’
program which employed under-advantaged youths. The court determined that, although
the employee was informed that his attendance at the swimming party was voluntary, he
might have felt compelled to attend, particularly considering that he was only 16 years old.
Further, the employer provided transportation to the swimming location, and the
employees were paid for the entire day. The court also found that the swimming trip
furthered the employer’s purposes of increased community goodwill, discipline, and
improved relations between the young people and the institution of government. Finally,
the court recognized that the accident took place during regular working hours at which
time full wages were being paid. It concluded that the accident was covered by the
workers’ compensation law.

In Palermo v. Reliance Ins. Co., another court utilized these guidelines to determine
whether or not an accident which occurred during an employer-sponsored trip to Mexico
should be covered as a workers’ compensation claim. The employer paid for transportation,
lodging, most meals and the cost of a deep-sea fishing trip; the employees paid for
individual activities.

The court determined that the trip was not mandatory and that it served no business
purpose. Further, the court stated that “the trip lost some of the ‘company’ character when
one member of the group brought two non-employee friends.” As a result of its analysis,
the court denied any claim for workers’ compensation benefits as a result of that accident.
Closer to home, another court addressed the question of whether an injury which occurred
while the employee was playing on a company-sponsored softball team was covered by the workers’ compensation law (Malveaux, supra).

In that case, the employer had paid the expenses of the team, which included uniforms,
equipment and park fees. However, participation on the softball team was voluntary, and
the employees were not paid while playing on the team. Furthermore, employees were not
pressured into playing on the team, and the employer received no money from the games.
The team was not organized for advertising purposes but was set up at the employees’
request. In addition, there was no evidence to show that the employer gained any goodwill
or other business benefits from the team. Finally, the games were not played on company
premises, and the members did not play during their work hours.

After considering these facts, the court concluded that the plaintiff could not receive
workers’ compensation benefits as a result of the injury he suffered during one of the
team’s games.

A different result was reached by another court, which addressed the question of whether
or not an employee who was injured while leaving an employer-sponsored “picnic” had a
right to file a workers’ compensation claim (Tuminello v. Willis Knighton Medical
Center).

The event was voluntary and open to all employees at anytime during the afternoon until 6
p.m.; they could attend either during or after work. The plaintiff chose to attend shortly
after the end of her workday. The social was sponsored for the joint benefit of the
employer and employees for the purpose of boosting employee morale and camaraderie;
only company employees attended. Additionally, the event took place on the employer’s
premises. Although attendance was voluntary at the event and the accident actually
occurred 15 minutes after working hours, the court concluded that the employee had a
right to make a claim for workers’ compensation benefits for her injury.

In summary, employers should be aware that employees who are injured during employer-
sponsored recreational events may have a right to workers’ compensation benefits as a result. A combination of factors affects whether such a right exists, including the degree to
which the event is mandatory; the benefit, whether tangible or intangible, received by the
employer from the activity; and the time and place relationship between the activity and
the employment.