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Risk Management

Liquor Licensees Assess Your Risk

February 18, 2014 By: Randy Durnal


Editor’s Note: M. Randy Durnal will be presenting his full assessment at the Nightclub & Bar Convention and Trade Show in Las Vegas on March 25, 2014. Don’t miss his informative session entitled “Accountability At Your Bar”.

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Randy Durnal

Through years of consulting, testifying and reviewing countless protocols nationwide from liquor liability complaints to slips, trips and falls, one thing remains consistent; the liquor industry is inconsistent.  Mom and pops to national chains spend millions of dollars to create the model environment promoting safety and profitability.  However, if the majority of these methods were working, restaurants wouldn’t be constantly sued for numerous reasons.  Many of these operations are deserving of the litigation that plagues the industry because they simply do not verify that what they are doing is the safest method to operate. 

One could say the economy has been the main culprit for bars and restaurants’ weaknesses, and they may be partially correct, but not completely.  Bars and restaurants simply don’t take steps to be proactive rather than reactive.  The vast majority of the venues today wait for something to happen, find out what went wrong and only then, do they attempt to fix the problem.

Why wouldn’t bars and restaurants develop a checklist for the deterrence of slips, trips and falls or fire danger prevention?  More significantly, why wouldn’t these operators build a checklist that deter over service, minor consumption, violence or even armed robbery potentials?  The basic questions for the recognition of dangerous and libelous occurrences will be essentially the same nationwide. To make the checklist better an operation would need to customize some of the questionnaire to your particular environment; this now shows you what risk factors your operation is exposed to, why they are exposed to them and some ideas of how to fix these problems. Some risk factors cannot be fixed.  For example; a large venue versus a smaller club will be more difficult to control because you have more patrons.  Therefore your potential risk would rise. 

If an operation is going to taunt their protocols as being the best, then verify the staff actually follows them.  Staff response to some of your policies may be “no we do not follow that requirement because we can’t”.  It would be much easier to re-write the policy so it could be followed or re-train staff to adhere to your requirements then to be sued and explain why the staff never followed the guidelines in place.  If you develop protocols, they must be the safest methods by which to operate otherwise you would not have your staff follow them.

Something else you may consider is background checks and drug tests on your newly hired staff members.  Greatly inexpensive and considering what they may illustrate about a new hire is worth its weight in gold. I would also recommend that you run this risk assessment at least once a quarter.  If you notice other concerns add it to your assessment. Keep it updated.

Further thoughts to help you assess risk and update concerns are to use a licensed Secret Shopper company.  By licensed I mean a company that will stand up in court should you decide to terminate a staff member after one of their visits.  Most states want the shopper to have a private investigators license; in that case you may want to research your state and their recommendations prior to hiring such a company. Secret shopper reports are invaluable in assessing risk, they will tell you how their treated and from a third party point of view what concerns or dangers they observe.  This can also help in adding questions to your assessment form.  Just make sure that the shopper and you are on the same page; tell them what your concerns are and what they should be looking for.

Here are some basic questions for you to use when you start assessing risk.  These questions have explanations as to why they are important:

  • Do you believe a person can be dangerous w/o showing signs of intoxication based solely on how much they drink and their size? Yes/No.  The question is designed to tell me if your operation only cuts people off once they reach obvious intoxication if you answered “no”.  If you answer is yes you run a more cautious venue.
  • Is the occupancy of your operation over 100 people?  Yes/No.  If your answer is “yes” then you run a more dangerous environment because you will have more points of sale, a larger space and more people to control. If you are a smaller bar then in theory the establishment will be easier to control regarding over service, violence and other potential dangers.  
  • Is your bar in a highly congested vehicle traffic area? Yes/No.  If you answered “yes” then the potential for more alcohol related collisions certainly rises.  If you are in a rural area or neighborhood location your chances for one of your patrons becoming involved in an alcohol related situation most likely will go down.
  • We have a time limit whereby we safely remove an obviously intoxicated patron from the premise. Yes/No  If you responded with any sort of time limit with a “yes” then you are accepting and handling your obligation.  You cannot simply allow a very intoxicated guest to mull the premise without supervision.  They can obtain more alcohol, cause fights or simply leave and drive away.

Always involve staff in these assessments.  They will give you the best feedback as to how they operate.  On the surface there is really no right or wrong answers.  This is simply a gauge.  The actual true assessment takes into account many other questions and will score each answer.

 


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