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Ground Rules

How to sponsor a company sports team without losing your jersey.

There's your company name, emblazoned on the back of the bowling shirts your employees proudly wear in their league. You're convinced that sponsoring the team not only gets your name out in the community, but also increases camaraderie and builds company spirit in ways that carry over to the workday. What happens, though, if your office manager drops a bowling ball on her foot? Is she eligible for workers' compensation? What if a fight erupts at a bowling tournament and a spectator gets hurt? Or what if alcohol flows at the after-game party and a drunken employee hits a pedestrian on the way home? Courts deal with these questions more often than you'd expect.

Whether the question concerns workers' comp for employees injured in a company-sponsored game or liability for the injuries of a third party, the basic question is the same: How closely is the company tied to the team or the sporting event? To determine that, the court often asks these questions: Are the games on the employer's premises? Are employees expected to play or asked to build relationships with customers on the playing field? In effect, is playing on the team part of the employees' jobs?

Consider two recent cases, both involving injuries to employees who were playing on company-sponsored softball teams. In New Hampshire, an employee learned during his job interview that he'd be expected to play on the company softball team. Softball was so much a part of the company's culture that the company paid nearly all its team's expenses, including uniforms, bats, gloves, weights and other equipment, plus air fare, hotel accommodations, meals, drinks and fees for tournaments around the country. When the employee injured his knee playing first base, he applied for workers' comp, claiming the injury stemmed from his job.

Although the company disputed the claim all the way to the Supreme Court of New Hampshire, the employee won compensation. The court noted the company's extensive involvement with the team. Work schedules were routinely adjusted to accommodate softball practices and games. When team members missed work for practices or games, the company never docked their pay--and it even paid overtime to co-workers who filled in. Playing softball was effectively part of the job.

In a South Carolina case, a worker was likewise injured playing softball for his company-sponsored team, but he was denied workers' comp. The court noted that the team was organized through employee initiative. All games and practices took place off the employer's premises, and team meetings were held during lunch breaks when workers were off the time clock. Although the company furnished uniforms, equipment and league dues, it never paid players or coaches. Although uniforms bore the company name and game scores were published in the local newspaper, that didn't provide enough direct benefit to the company to rule that the player was injured on the job.


Steven C. Bahls, dean of Capital University Law School in Columbus, Ohio, teaches entrepreneurship law. Freelance writer Jane Easter Bahls specializes in business and legal topics.

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This article was originally published in the September 1998 print edition of Entrepreneur with the headline: Ground Rules.

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