The holiday bonus—the financial reward some employers give their employees to thank them around the holidays—appears to be on the rebound. (And thankfully, it’s not just memberships to the Jelly-of-the-Month Club.)
A recent survey by American Express OPEN Small Business Holiday Monitor found that 42 percent of small-business owners planned to give their staff a year-end bonus in 2014, up from 27 percent in 2013.
Many employers did away with their holiday bonuses during the Great Recession. But the significant increase in holiday bonuses this year suggests that employers may be feeling merrier—and understandably so. The economy and job market seem to have made nice comebacks in 2014, and many employers know they must do more to keep their talented workers content.
Optimism among small-business owners in December reached its highest level since February 2007, according to a report last week from the National Federation of Independent Business.
Some companies are finding unique ways to reward their employees around the holidays. One Boca Raton, Florida, company, BMI Elite, gave each of its 100 employees a $250 shopping spree at a local mall, according to local news station WPTV.
While year-end bonuses can be a good way to show appreciation to employees around the holidays, business owners and managers should put some thought into how they hand out bonuses.
Dan Finnigan, president and CEO of recruiting software maker Jobvite, offers some tips on Inc.com. He says employers don’t have to give out large bonuses; rather, it’s the thought that counts. Companies should try to align their annual bonuses with their performance, so employees can see how the company’s success ties back to how much bonus they receive. It’s also important, Finnigan says, that companies hand out bonuses in a fair manner, so bonuses don’t cause disgruntled feelings.
Finnigan says it’s important that employers consider in advance how to reward their employees at year-end and do so in a way that is consistent and clearly communicated. In good financial years, all employees might receive a cash reward. In not-so-good years, they might just get a year-end party or a small gift. He writes:
Not every company can afford big bonuses, lavish parties, and special gifts. Don't let that stop you from finding other ways to give to your employees. If you've communicated expectations appropriately, and you're not in a position to spend much money, your employees will appreciate any sincere and humble gesture--yes, even if it's a subscription to the Jelly of the Month Club.
Read more small-business news.