It’s a fairly straightforward and widely known fact that folks under 21 can’t legally buy alcohol. However, we all know young people will try to get around that sometimes. When you own or operate an establishment that sells alcohol, the consequences of breaking this law can get complicated -- and costly!
Below are just some of the penalties a business owner, operator, and employee can face if you sell to a minor. The term “sale” includes both serving alcohol on-premise (such as a restaurant or bar) and also selling it to be consumed off-premise (like a liquor store or convenience store).
Penalties from licensing agencies vary widely from state to state and jurisdictions within states (counties, parishes, cities, towns). Check with your licensing board for the formal rules and regulations. Infractions of underage drinking laws in an establishment can hold the owners, managers, and employees all liable in civil and criminal courts. Consequences range from inconvenient to potentially catastrophic for your business.
- Fines and Citations by Licensing Agency. These are entirely up to your local laws and rules, and the severity and frequency of any infractions you’ve had on your licensing record.
- Civil Charges. These fines and penalties arise from the actual breaking of regulatory guidelines. Licensing board findings of wrongdoing can be the start of civil charges. A civil matter can tie you up in court and take money and time to deal with.
- Criminal Charges. If convicted of a civil infraction, all states allow criminal charges to be filed. Criminal charges can result in thousands of dollars in fines and even incarceration, depending on the jurisdiction and the severity and frequency of infractions. Owners need to be very aware of the Dram Shop Rule (a statute known as the Dram Shop Act, based on case law), which 38 states strictly enforce. These laws govern alcohol vendor’s liability when injury or accident follows the sale of alcohol in an establishment.
- Loss of Liquor License. Your license may be suspended (resulting in loss of revenue during that time and costs to lift the suspension), or revoked completely. In any state, your liquor license can be revoked for ANY infraction, even a first-time offense. Applying for another liquor license after revocation can take months, cost tens of thousands of dollars, and your application for a new license will depend on your previous license’s record. Meaning the licensing board will take into account why you had a previous revocation.
- Lawsuits. If you’re not following local and state licensing rules, and especially if you’ve already been convicted civilly or criminally, you can absolutely be held liable in the event of criminal behavior resulting from the sale of alcohol to a minor. It can include DUIs, accidents or even fatalities. Settlements from lawsuits (especially involving severe injury and death) can run into the millions.
What can you do about it?
The bottom line is, you and every employee in your business MUST be educated on the importance of never selling to minors - and what the fallout can be if it happens. Your first and best line of defense is your employees. Consequences of selling to minors are usually less severe if the vendor has been lied to (such as a forged ID or using an older person’s ID). Penalties are usually more severe if IDs are not thoroughly checked or not checked at all. Vigilance is crucial.
Educating yourself and your staff can save you from the potentially disastrous effects outlined above. Employee training and education on enforcement of laws and rules for serving to minors and is key. Compliance checks are a fundamental piece of a training and risk prevention program as well. Understand how to mitigate risk and empower your team with the knowledge to be proactive. Check out our comprehensive e-book for all the ways you can keep your business and your customers safe!
Click here to download our eBook “Challenges & Opportunities: Regulatory Compliance Training in the Food & Beverage Industry” to deepen your knowledge about the array of risks, challenges, and consequences - and let us help you with online training, tools, and an action plan to mitigate any danger to your business!