According to the National Highway Traffic Safety Administration (NHTSA), in 2012, over 10,000 vehicle-related fatalities involved a drunk driver. Not only were these people liable for their actions, the establishments where they were drinking are also susceptible to punishment for over-serving clientele who then injure a third party.
These types of lawsuits are not cheap, either. Well-known liquor liability cases include the Outback Steakhouse, which was ordered to pay $39 million by an Indiana jury after a patron of the restaurant chain struck the plaintiff with his car, and T.G.I. Friday’s, which was ordered to pay $1 million to the parents of two 16-year-old teenagers who were killed after being involved in an accident with a drunk driver. Witnesses in the case claimed that the patron at T.G.I. Friday’s was drinking for eight hours at the establishment before the accident occurred.
These cases are not isolated incidents—victims and their families file suits against restaurants or bars every day for their role in serving a customer who is then involved in an alcohol-related accident. To help protect your establishment, employees and patrons, establishing a liquor liability prevention policy, training workers and transferring risk are critical to minimizing your liquor liability.
Prevention through Education
The most important defense against being liable for drunken driving accidents is prevention through education. It is imperative that you design a liquor liability training program for staff members who will serve alcoholic beverages to customers. In these training sessions, employees will learn important information such as how to determine if someone has had too much to drink, how to deny a patron service and how to identify valid forms of identification to prevent serving alcohol to minors. Once an employee has completed the training, he or she should sign an agreement form outlining that they comply with and understand the policies set forth by the establishment.
Specifically, training should include the following:
- Signs of Intoxication
- Monitoring Consumption
- Offering Continued Service
- Denying Service
- Reporting Incidents
- Employee Legal Consequences
As part of your initiative to lessen risks, educate employees on how drunken patrons may affect their lives. Employees must understand how serving to minors who use fake IDs will result in large fines or how dram shop laws are stricter than ever and breaking them may pose serious consequences. Remind employees that they are liable and could a face a number of consequences for not cutting off patrons before they’ve had too much to drink. Types of employee liability include:
- Criminal Liability: Employees can be found criminally liable for serving to minors with a fake ID or serving to a patron who appears intoxicated. The employee can face monetary fines, probation or jail time depending on state laws. In addition, your establishment can lose its liquor license and is susceptible to fines as well as higher insurance premiums.
- Civil Liability: If employees are found guilty of civil liability for a patron’s injury, that employee, the owner and the establishment face large monetary fines. At times, these fines are so large that they cause bankruptcy.
- Dram Shop Laws: These laws allow establishments, owners and employees to be sued by an individual after they’ve been injured by a patron served at the establishment.
Transferring Your Risks
To protect your business, it is wise to obtain a liquor liability policy either as standalone coverage or as part of a restaurant and bar package policy. Contact Naught-Naught Agency at 573-634-2727 for more information about these effective coverage options. We understand carrier requirements and the state’s dram laws to design a policy that suits you best.