Event that sees people on fire? (4,4)
I believe the answer is:
sack race
'event' is the definition.
(sack race is a kind of event)
'people on fire?' is the wordplay.
'people' becomes 'race'.
'on' says to put letters next to each other.
'fire?' becomes 'sack' (dismiss someone from their job).
'race' after 'sack' is 'SACK-RACE'.
'that sees' acts as a link.
(Other definitions for sack race that I've seen before include "Get rid of nation" , "sports day event" , "Jumping contest" , "event - with 10d" , "athletics contest" .)