What are the do's and don'ts of Christmas bonuses?

In oil-rich Calgary, many employees find Christmas bonuses or company gifts a valued part of the holiday tradition. But if they aren't done right, some gifts can mean more work on the employee's part.

Some employers give with good intentions, but end up causing headaches for employees later

The tradition of companies giving Christmas bonuses is still going strong, but not everyone agrees on whether those should be cold, hard cash or more flexible options like time off. (Britainy Robinson/CBC)

In oil-rich Calgary, many employees find Christmas bonuses or company gifts a valued part of the holiday tradition.

But if they aren't done right, some gifts can mean more work on the employee's part.

Here are some common pitfalls and perks of the Christmas bonus tradition.

We want to hear your thoughts on which practice is a "do" and which is a "don't", so post your thoughts in the comment section below. 

Gift cards

Easy and convenient, these perennial favourites are common in offices across the county. Whether for coffee shops or grocery stores, gift cards are a simple way to make sure people can get what they want and often come in amount around $25 when given from employers to employees.

However, what many people don't realize is that they need to be declared as taxable income, according to the Canada Revenue Agency. A gift card is considered a near-cash gift along with securities and stocks, and so must be declared on tax forms in any amount.

This is sparking the beginning of a move away from giving gift cards as bonuses, says the Calgary Eyeopener's workplace columnist Margot Ross-Graham. 

"It really is an example of an employer trying to do something good and then turning around and making a big mess of it," she said. 

Rank-and-file pooling for CEOs

​Some companies have started asking employees to pool their money to help buy a spectacular gift for the CEO or other high-ranking executives.

"I know of an example of an organization where they wanted to make sure the CEO got this amazing trip for his family to go skiing for a couple days, and they asked every employee to chip in — but it was given in such a way that they felt they had to chip in," said Ross-Graham.

"So you have a part-time, front-line employee who's probably not making a significant amount of money, being pressured to buy a gift for the most expensive person in the organization. That, to me, would be an example of the worst Christmas debacle that happens in an organization."

Looking inwards

One company that makes it a priority to give to charities like food banks decided to look inwards to help struggling employees and their families. 

"I know of at least one organization who has created a situation where they can provide those same things for struggling employees in the company, without those employees feeling like a charity," said Ross-Graham. "Not everybody knows who that person is, but they're able to give it to that family."

In another example, a company that usually gave gifts to every employee decided instead to create one beautiful package and draw names for the winner. However, the entire scenario was organized so that one employee — who had suffered extreme financial and personal difficulties over the past year — would be the only name in the draw. 

"They were able to celebrate this person's Christmas without the person feeling, again, like a charity, but everybody got to celebrate in the joy this person experienced," Ross-Graham said. 

Cold, hard cash

This age-old standby is still a very popular tradition, with many organizations arranging for their bonuses to come out at Christmas time. For some employees, that can be frustrating because they see it as a bonus earned throughout the year that they don't get until Christmas.

While it's not as common, some employers will also give a cash bonus — unrelated to the annual bonus that happens to come out at Christmas time — during the holiday season.

Others give their employees a bit of time off, by shutting their offices during the Christmas break and allowing their employees to have that paid time off.

What's the best Christmas bonus or gift you have received from an employer? Post your answer in the comment section below.


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