Christmas Bonuses in this economy??

djacobs475 · November 2002

My boss, the CEO, has in all previous years, given Xmas bonuses (small ones, about $100-$300) to all employees. We have grown and are now at 48 employees and it isn't feasible to do it anymore (never mind that we haven't made a profit this year). We are talking about giving $50. gift certificates to employees instead. He is afraid that the employees will get VERY upset and angry and so he is re-thinking giving them bonuses to assuage them, except that it will come out of next year's budget so he intends to give it in January.

Here's the question: Is it better to get the gift certificate before Christmas or the Christmas Bonus in January? I am reticent that giving the bonus in January will lead to the perception that our company is in financial trouble.
If it matters, 80% of our personnel are hard working blue collar.

Any suggestions or creative ideas?

Thanks.

Sandy · November 2002

We have our holiday party in January which is a great success, we almost always have 100% turn out for this event. This is when we distribute the Christmas bonuses. The advantage of this is that folks don't use the money on gifts for others, they are more likely to spend it on themselves. We also provide the option for employees to spend the night at the hotel where we have the party at. They put the room on their own charge card and then submit an a/p check request for reimubursement. It makes for a nice weekend get-away and give all our employess (we fly in our 3 outside sales and 8 regional service centers employees w/ spouses/significant others) a chance to get together. It's really a great time (and awesome place to work). Hope this helps.

Don D · November 2002

If the company is having financial difficulty, the workers probably already sense it. But, back to the gift. If you call it a Christmas Bonus, it should be given FOR CHRISTMAS. I have an idea for you. Give the 48 employees each a $50 gift certificate and a $12 turkey coupon. You can make them all smile for less than $3000.

Theresa Gegen TX · November 2002

I think employees will be mad if it comes as a shock and they don't know that no bonuses are going to be paid like prior years. They will be mad if they expect $300 and only get $50. You need to communicate with the employees about it early. Some employees may be relying on the bonus to buy presents for their kids, ect. They need to be given a heads up as soon as possible so they can plan their christmas.

I would not pay the bonus if the company is in financial straits just to assuage them. Alot of employers are shutting down during the holidays this year with no pay for employees. I really think open and honest communication about it will help!

Good Luck!!

bamahr · November 2002

We had this same problem - we bought a company who gave Christmas Bonuses - we gave a gift (t-shirts, jacket, etc). The first year the companies were merged the employees from the new company wanted both and got them. Bonuses and the gift. The following year - we stopped everything. We explained it was not feasibile with over 200 employees. They were initially angry and we still have some of the old timers recall the "good ole days". I agree - don't wait until the last minute, letting them know as soon as possible is best. Believe me they will be angry - but eventually they will get over it.

Don D · November 2002

I can agree with being disappointed, but angry? Sadly, employees nowadays, all of us, come to expect such things once it's done once and we see it as sorta something the company 'owes' us. Employees should see such gifts as just that, gifts. Perhaps the flip side should be for companies that do give bonuses and gifts to emphasize them as gifts, dependent on the charitability of the owners and the continued good financial position of the company. How many of us have ever gone up to the CEO, privately, with no ulterior motives, and told him/her that you really appreciate the generosity shown by the bonus/gift? Or better yet, written a private thank you note. I'll bet in that regard, we're sorta like a lot of kids today who don't have a clue what a thank-you note is. The warmest of all the 'Little House on The Prairie' shows was the Christmas one about the really tough year when nobody could afford much of anything and the beauty and love expressed by each of them when they went about searching for and giving each other something small and no-cost but personal and wrapped up in tacky paper. x:-) (Damn! I'm beginning to sound like Paul here.)

bamahr · November 2002

What everyone is our particular case forgot was, everyone kept their job during the buy out. They were more concerned that they lost bonuses from $25 - $250 (depending on length of service). Most made twice their bonus in a week. I can bet few stopped to think how lucky they were to still have a job.

Don D · November 2002

Right on! And they didn't take time to think, "Hey, if our company had not been bought out, I could have taken the bonus they would have given me and put it with the unemployment check I would have gotten 3 weeks later and, Voila, would have had almost a whole paycheck."

Paul in Cannon Beach · November 2002

Not to sound like Don, but I think you should always communicate honestly with employees about the organization's financial situation. Don't pretend everything is alright by giving the same bonus (entitlement) that you have in past years.

Clearly communicate your appreciation for them, your deep desire to continue to provide the highest level compensation and benefits you can afford, but also communicate that the company has to be profitable for bonuses and raises to continue.

Consider it a teachable moment and give your employees the credit for understanding how things work. They all have kids. They understand the tension between getting Junior the best present and paying the mortgage.

We went through this a few years ago and it was actually a very positive experience.

Paul

Christmas Bonuses in this economy??

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