Businesses in the hospitality industry (bars, restaurants, hotels) provide a fun and relaxed atmosphere for clientele to briefly escape their everyday routines. While these establishments look for ways to distinguish themselves from the competition, they often share one common feature: a bar. Alcohol service, the commercial sale of alcohol, creates unique risks and exposures which business owners must not only address by having specific guidelines in place; they must also strictly enforce.
The Problem
Did you know that laws regarding the selling and consumption of alcohol are not established by the federal government? Local authorities establish and enforce these laws which means the specific guidelines as to who can sell, purchase, and consumer alcohol and under what conditions – as well as the punishments for violation – vary widely across jurisdictions. Although all fifty states have a minimum drinking age of 21 and maximum limit for blood alcohol content (BAC) allowable to operate a vehicle, that’s where the similarities end and differences begin. Failure to manage the commercial sell of alcohol in one’s business could threaten the success of a business due to increased liability exposure, both criminal and civil.
There are a variety of laws and regulations that might impact your business in relation to service of alcoholic beverages. One such law is a DRAM Shop Act that may allow third parties or others to recover for damages caused by alleged overservice of alcohol. In addition to DRAM, some states allow for the criminal prosecution of the servers in cases where the alleged alcohol overservice caused damage to property or injury to people. Failure to follow the appropriate laws and regulations for your business could result in fines, jail, license revocation and/or bad publicity.
While it is understood that all services provided to the public carry some risk, proper controls can help limit your exposures, create a safer environment for your customers and employees, and help maintain a positive reputation throughout the service industry.
Recommended controls include:
- Management Responsibility
- Education and Training, including state-approved programs (ServSafe is an accredited company recognized across the country for service training. Society Insurance has a partnership in place that provides discounts for Society policyholders to use any service offered by ServSafe. Click here to get started with ServSafe.)
- Staff Controls
- Service Controls, including drink counting and cut-off policy
- Security Controls
Stop risk to keep your business going. Find more whitepapers, case studies and safety resources from our risk management team at societyinsurance.com.
