Do You Reward Employees At Holiday Time? Hot

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A company event

Cash bonus

Noncash bonus


A company event could be a lunch, happy hour or dinner. Typically, spouses/partners would be invited to join for dinner. The advantage to this option is that it enhances team relationships. Some companies add in a gift exchange. I believe this a great option because it not only recognizes the entire group, it is a way to celebrate the year and recognize achievements.

A cash bonus is always welcomed by employees, especially around the holidays when they tend to spend extra money. It has been shown that cash is a negative motivator, meaning that employees will be unhappy if they believe they’re not being paid enough, but making more does not increase their satisfaction. So, if employees expect to get a cash bonus and don’t receive one, they will be unhappy. If they’ve never gotten a cash bonus, this option might not be the best way to go (unless they see their friends at other jobs getting bonuses and they feel shorted.) If you’re giving cash bonuses, be careful of being overly generous. Remember that employees will adjust their expectations going forward.

A noncash bonus, such as turkeys or other gifts, can be easier on the budget and a more tangible or personal way to say thank you. The down side is that it takes more work and, if the gift value is material, the value will need to be included in the employees’ taxable income. If the employee is stuck paying tax on a noncash gift, you might create resentment instead of gratitude.

Perks are nice, but, like a cash bonus, could create expectations in the future and might not be viewed with the same satisfaction as a “hard” gift. Perks such as extra days off during the holidays or free postage for mailing gifts are examples of relevant benefits that could be bestowed for the holidays.

What if you want to switch it up? Employees will be happy with this only if what you do this year is better than last year.

In summary basic rules of holiday rewards for employees are:

  • Do something!

  • Plan a company event.

  • Whatever gift or perk you decide to do, make sure it is something the employees will appreciate.

  • Whatever gift or perk you decide to do, you need to be okay with doing something similar in future years.

  • If you want to change what you "usually" do, be sure it will be perceived as better than last year and that you are prepared to continue in future years.

Happy holidays!


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