Hosting a holiday party for employees or friends and relatives? Remember, office parties can undermine otherwise well-executed corporate policies against sexual harassment and discrimination. Courts consider holiday parties to be part of the work environment, so employers are responsible for what takes place.

Here are tips from Marsh, a leading risk advisor and insurance broker, for preventing situations that could turn your good times into lawsuits.

• Choose the venue wisely. Firms with multiple operations or departments should issue instructions describing suitable venues for year-end parties. Employees have brought suits against firms whose local offices have held parties at inappropriate locations, such as those considered sexually offensive or discriminatory.

• Check accessibility. Before choosing a party venue, make sure it's accessible to any employees with disabilities or special needs.

• Restrict alcohol consumption. Work with the caterer, restaurant, or bar to limit the number of alcoholic beverages served to employees. Use drink tickets to help control consumption. If the party includes a cash-bar, provide free non-alcoholic drinks for designated drivers.

• Brief supervisors. Remind supervisors that office parties are an extension of the workplace and they need to respond to discrimination or harassment situations as they would during the course of business. Provide a brief overview to supervisors of company policies regarding the party, alcohol, and sexual harassment.

• Assess ability of attendees to get home safely. Appoint a company supervisor to consider whether an employee or other attendee can drive or otherwise get home safely, and make appropriate travel arrangements for them if necessary.

• Investigate all complaints. Failure to respond to complaints can lead to greater liability than what results from the alleged misconduct. Don't dismiss any complaints associated with the company's holiday party without conducting a prompt and thorough investigation and taking remedial action if warranted.