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How to minimize the business risk of employer-sponsored sports teams

Sponsoring an employee sports team or event can be a great way to promote camaraderie, team building, and exercise. Yet, there are potential liabilities, including liability for a Workers' Comp claim and liability for injuries of a third party caused by an employee, and it pays to mitigate the risks.

While Workers' Comp laws vary by state, the relationship of the company to the activity plays a key role in assessing liability. In general, if the injury is deemed to arise out of and in the course of employment then it is compensable. Some states, such as Pennsylvania, have also long held that a determining factor for liability is whether an employee is furthering an employer's business when injured.

Here are some guidelines that will help minimize risk: