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4 Rules of the New Office Holiday Party

CHICAGO ( TheStreet) -- The office holiday party is a December tradition, but like many it must change with the times. While free-flowing cocktails used to be a given, today's office festivities are just as likely to be alcohol free. Back in the days of unlimited entertainment budgets, companies were considered chintzy if they didn't spring for a lavish meal for employees and spouses; now, rampant cost-cutting has made semi-formal dinner-and-dancing parties an endangered species.

So what are the new rules of the office party? When small businesses are performing a cost-benefit analysis on practically every penny of spending, can they justify the expense of an annual office bash?

With office-party season in full swing, here are the key issues small-business owners should keep in mind when it comes to holiday celebrations:

1. DO ask your staff
While holiday parties can be a good way to reward employees with some free food and time off work, they aren't necessarily the best use of your money. After all, some offices are more social than others. The best way to assess whether a party makes sense for your particular group of workers is to ask them.

It's something that happens all too rarely. In the vast majority of cases, workers are simply informed about the party rather than being active participants in the planning.

If the general consensus is that employees would rather not have a party, owners or managers can still spread some holiday joy by calculating what the cost of a party would have been, then divvying up that money as bonuses instead.

2. DON'T play bartender
The mild-mannered co-worker who shocks everyone by letting loose at the office party has been a running joke for decades. But the role of alcohol in end-of-year celebrations is one of the trickiest issues company owners and managers must navigate. One increasingly common solution is to schedule a lunch party at which alcohol is simply not on the menu.

If drinks are a must-have element at your company's parties, the most important thing is to limit potential liability. "A business can be sued if an employee drives drunk and has an accident," says human resources consultant Ann Novak, of AP Novak & Associates in Washington, D.C. "If you hire a professional bartender, he or she will have a license and be trained when to tell someone they've had enough to drink."

Sexual harassment is another liability issue that can come up when the drinks start flowing, Novak says. Remind employees in advance that all work policies apply during the event, and have an action plan in place for handling employees who begin to behave inappropriately.

3. DO Promote Teambuilding
Anyone can book a space, order food and call it a party. But unless you have a naturally outgoing, festive bunch of workers, getting everyone involved and interacting can be a challenge.