Shakespeare first wrote about “happy hour” in 1599 in King Henry V. While his mention of a “happy hour” didn’t coincide with bellying up to a bar for a two for one special at the local pub for bards, the “happy hour” term for drinking came from Prohibition era Americans as a code word to drink in secrecy at speakeasies.
Catching up to the present, currently eight states (Alaska, Indiana, Massachusetts, North Carolina, Oklahoma, Rhode Island, Utah, and Vermont) have bans on happy hours. Businesses in these states are not allowed to set a time to reduce or discount the price of alcoholic drinks. Many remaining states, like New York, have restrictions on happy hours to prevent binge drinking.
In New York, under ABC law §117-A, 2-for-1 deals are legal, but 4-for-1 and unlimited drink deals, are illegal. Establishments can offer “buy one get one free” specials because both drinks are half priced, but “buy one get one for one cent” is illegal as it’s creating a price that’s less than 50% the price of the original drink.
No beast so fierce, but knows some touch of pity… But I know none… and therefore am no beast
The SLA shows some pity on bars who serve brunch and are open for New Year’s celebrations.
The Sunday On-Premises Sales Permit would authorize a licensee to open and serve alcohol from 8am to 10am on Sundays for up to 12 times a year. Each permit costs $35 and applicants must notify their local municipality of their intent to apply at least 30 days prior. Also, during a heavily documented scare in NYC in 2014, many people became aware that unlimited drinks, like bottomless mimosas and Bloody Marys, were illegal according to ABC law §117-A. After many media outlets reached out to the SLA, the SLA issued this statement:
Serving unlimited drinks to a patron is prohibited under the Alcoholic Beverage Control law, and instances of over serving by our licensees will be investigated and prosecuted. However, there is a limited exception in the statute when the service of alcohol is incidental to the event, such as in the case of certain brunch specials. Even under these limited exceptions, licensees still have a legal obligation not to over serve patrons. The SLA will continue to take a balanced regulatory approach by allowing licensees to conduct specials where alcohol is an accompaniment, while simultaneously cracking down on specials that promote excessive drinking.
Diligence is required in how you promote your event to balance the expectations of the SLA and your customers. While the SLA pointed out the loophole in their rule, they can still revoke your license if they find you are over serving.
For New Years, bars may apply for a special permit to stay open later. For this permit, the SLA will consider the licensee’s disciplinary history (including pending charges) and if the licensee has adequate facilities and security plans in place. Notice of intent to apply for the license must also sent to local law enforcement. In 2016, the New York SLA did not issue any of these permits because New Year’s Day fell on a Sunday.
Planning for happy hours, brunches and New Year’s events requires not only following the rules of the New York SLA, but also how you represent your drinking deals to your customers. While the average drinking customer may not know the laws, how you advertise and promote your event can reduce bad reviews and potential security risks.
See also our previous Happy Hour blog posts:
Tracy Jong has devoted the last decade of her quarter century career focused on businesses such as restaurants, bars, liquor stores, breweries, wineries, cideries and distilleries. Broad business and legal experience allows her to be the ideal strategist and consultant to the industry in the unique issues entrepreneurs encounter from cradle to grave, helping these businesses at every stage of their life cycle. She is actively involved in craft beverage branding at every level. She focuses on cost-effective strategies and problem-solving, bringing the typical large firm experience and expertise in the boutique firm style with personalized service and industry focused approach. She may be contacted at TJong@TracyJongLawFirm.com. Connect with her at: Twitter, Facebook, Linkedin, Instagram. Visit her website at www.TracyJongLawFirm.com.