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When planning and organizing special events, the primary focus is usually on how to maximize the attendees’ satisfaction and achieve the PR, marketing, or HR management goals for which the event was organized.
Yet an equally important part of event management involves making sure that you meet the legal requirements for hosting events and know how to deal with liability and legal issues. Not doing so may have negative consequences, ranging from simple fines to tort litigations and more serious scenarios.
Such requirements and rules are usually set by authorities at the national, state, and local level. They may differ based on the type of event that you are hosting and change over time depending on the circumstances (like the recent COVID-19 pandemic).
Let’s analyze the most important legal and liability issues for corporate events, as well as the best practices for event planners and managers.
Legal and Liability Issues in the Age of Coronavirus
Since the start of the COVID-19 pandemic, organizers have faced new issues regarding liabilities in event planning.
First and foremost, it’s important to note that you’re not going to be liable simply because you are hosting an event during the pandemic.
For liability to exist, there must exist some form of negligence on your part. Such negligence should be measured against a reasonable standard, that is, the guidelines and recommendations that are set at the national, state, and local levels.
Watch this video with attorney Joseph A. Nuñez and CEO of Event Solutions Brad Lipshy addressing legal and liability issues when event planning during COVID19:
To see more videos addressing events during COVID-19 (and other illness breakouts) visit: “Making Events Extraordinary”.
It’s also important to note that liability is not dependent on the venue where the event is hosted, but rather on whether the right procedures were followed or not.
For example, the Department of Fair Employment and the Equal Employment Opportunity Commission have both stated that a business can ask event participants and employees to have proof of testing or vaccination if it goes to further legitimate business interests and if not doing it can threaten others, as long as the ADA (Americans with Disabilities Act) is not violated, and reasonable accommodation are made for people with certain religious beliefs.
Finally, you should keep in mind that when guidelines at national, state, and local levels differ, the strictest guidelines always apply. Beyond this, standard best practices apply when addressing legal and liability concerns in event planning. What are those?
Make Sure You Have All the Necessary Permits
The first step is to gather information on which permits are needed to host your event. This may depend on the type of event that you are hosting and the county, city, or state in which such event takes place.
Here are some permits that event organizers in Los Angeles County may have to obtain.
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Building permit: the use of prefabricated or portable structures is very common in certain events. In this case, it’s important to check whether you require a building permit from the city.
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Food permit: event attendees are often offered free food and beverages. In this case, the event organizer must obtain a permit to operate as a temporary food facility, that is, a facility that serves or sells food at a specific venue for the duration of that specific event. Such facilities must obtain a health permit and act by the California Retail Food Code. This is necessary to guarantee that the food is safe for human consumption and that the health of the event attendees is protected. Visit Los Angeles County Public Health’s website for information on how to obtain this type of permit.
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Alcohol permit: in addition to food and soft drinks, certain events also offer alcoholic beverages like wine, beer, or cocktails. In this case, it’s often necessary to obtain the relevant authorization from both the police department and the city, as well as a state license from the Department of Alcohol Beverage Control. You can find additional information on the California Department of Alcoholic Beverage Control website.
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Trade show and exposition permit: when hosting a trade show or an exposition, the city must make sure that its facilities comply with rules on things such as layout, crowd safety, and pedestrian flow.
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Public assembly permit: this permit is mandatory when you plan to host public assemblies in locations that are usually not used for this purpose, like warehouses, gardens, or barricaded streets.
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Temporary use permit: you will need this permit if you plan to use private property for certain activities that are typically not allowed on that type of property. Examples are outside sales of products, fairs, exhibitions, and temporary communication facilities. Visit the website of Los Angeles County’s Department of Regional Planning for more information on temporary use permits.
Other permits may be required in certain situations, such as entertainment permits, amplified sound permits, electrical permits, and park use permits.
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Sign a Contract with All the Necessary Clauses
Even when events are organized perfectly and all the right things are done to maximize the client’s satisfaction, things may not go as planned, and having the right contract in place can protect you from unnecessary risks and costs.
Always make sure that your contract includes at least the following clauses.
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Cancellation terms: Cancellation of the event can be caused by either the client or a problem that makes you unable to host the event. To protect yourself from the event that a client requests a cancellation when you are already at an advanced stage of the planning process, it is wise to state in the contract that the payments already made by the client are not refundable. If possible, also state that the client must cover the additional cost that you have incurred since the last payment. When you are the one canceling the event, several options could be included in the contract: you may reimburse your client, adjust the event date and provide tickets at a discounted price, or take it upon yourself to search for another event planner. A laundry list of potential issues may be covered by a force majeure clause that releases you from liability in the case of certain extenuating circumstances.
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Payment schedule: It’s usually wise to ask the client to pay a deposit before you start organizing the event and to state in the contract that you will start working only after receiving such a deposit. The remaining sum can either be paid after the event or gradually with milestone payments. Make sure that the price of the various items (event venue, staff, food, etc.) is referenced in the contract to avoid future objections from your client.
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Termination: A termination is different from cancellation because in this case the reasons for the event not taking place can’t be controlled by either the organizer or the client. For example, many large events were terminated during the first stages of the Covid-19 pandemic because nobody could predict such circumstances. Termination can also be caused by very bad weather if you are planning to host an outdoor event. Depending on the type of event that you’re hosting and its location, the contract should include all the circumstances (no matter how unlikely) that can lead to the event being terminated.
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Indemnification: This clause excludes your liability if a third party sues you for something caused by the client’s negligent behavior. An example is the venue’s owner suing you for damages to the venue caused by one of the attendees. An indemnification clause will make your client liable in such a scenario.
Liability Issues and Insurance Policies
Another tool that can protect an event organizer from certain adverse scenarios is an insurance policy. Take some time to assess whether you need to be insured against certain possible scenarios and, if yes, to determine what type of insurance coverage you need.
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Event cancellation insurance: even when cancellation and indemnification terms are included in your contract, there is still a risk that some of the costs that you have incurred will not be reimbursed. An event cancellation insurance will protect you from scenarios such as your event being canceled due to very bad weather when you have already incurred high costs for open-air venue rental and catering.
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Public liability insurance: unfavorable circumstances may lead to the event organizer being considered responsible for an event attendee experiencing injuries and health issues or a third party’s property being damaged. In this scenario, a public liability insurance policy will cover your defense expenses and take care of the settlement if you are found liable.
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Employer’s liability insurance: injuries and similar negative events can also be experienced by a member of the event’s staff, who can blame it on the organizer’s negligence. In this case, an employer’s general liability insurance policy will cover both your defense costs and any compensation to your employee. In most cases, it is mandatory to have such an insurance policy.
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Equipment insurance: if your event involves the use of your equipment and if such equipment is particularly expensive (e.g., music equipment, maxi screen equipment, etc.), you may want to insure yourself against possible damages, as well as the possibility of loss and theft. Such an insurance policy may also apply to renting equipment to avoid losing a large deposit or incurring high costs to compensate the rental business.
While legal liability protection is an important item to consider when planning your event, it should not be the deciding factor. Event planning companies like Event Solutions are fully insured and often outline their Health and Safety guidelines on their websites or proposals. A safety contingency plan should also be provided upon request and is unique to your event. This will outline everything you need to give you peace of mind that your event is as safe and protected as it can be.