Or it's just a miscommunication: The boss was throwing the party with the intention of everyone having a chance to relax and have fun, but everyone else saw it as a career opportunity and "dressed for success".
Then the boss doesn't understand that people aren't not going to treat him like their boss so long as they work for him. Ultimately that guy signs their paychecks, that dynamic is going to be unequal for the entirety of that relationship.
Yeah, there are multiple interpretations possible of such a situation; my describing this kind of situation in the context of a discussion of counter-signalling biases our interpretation. A host dressing the most casually possible means that none of their guests will be under-dressed, for example. Also, the culture and expectations of the work place matter.
