Gifts or Gaffes?

Gifts or Gaffes?

What are some guidelines for giving holiday gifts to employees? 

By Shari Lau

Isn’t it mind-boggling how something as well-intended as a gift can be so fraught with potential landmines? In the workplace, gift-givers must be mindful that a poor choice could result in a religious discrimination claim, a favoritism claim or just plain weirdness.

I remember when an executive in my division handed me a holiday card with a cartoon depicting the mounted head of one of Santa’s reindeer (Dancer, I think) hanging above Santa’s hearth. The card’s written message was humorous, but it basically implied that Dancer hadn’t pulled his weight around the North Pole that year and was beheaded as a consequence. I stared at it, wondering if I had just been fired. I realized the humor in the unintentional misstep, however, and joked about it with the executive. But others who received the same card remained silent the rest of the day.

There is no one gift that will please all employees. Even cash may be seen by some as impersonal. So if you decide to give presents, or to allow or encourage managers to do so, here are some things to keep in mind:

First, make it an actual gift. If it’s tied to performance, that’s not a gift; it’s an earned reward.

Second, consider the company culture. What have employees found meaningful in the past? Would a charitable donation in their names be well-received? Would giving them a day off to volunteer in some charity or school event have a positive impact? Or would they appreciate a personal day off in gratitude for a successful year?

If tangible gifts are more in line with the culture, you might treat employees to highly desired company merchandise, movie tickets, dinner vouchers, or gift certificates to online general retailers or local grocery stores. Certainly, cash gifts are generally popular; the amount can be the same across the board or determined by employee position.

If managers are the givers, remind them not to give overly personal or intimate gifts. Jewelry, perfume, religious items and clothing can be taken as overtures of unwelcome attention or can create feelings of religious discrimination. One manager I know bought the women on his team baskets of designer face lotions, not realizing they were anti-wrinkle creams. The recipients noticed. Gag gifts are also a poor choice. Many are inappropriate or feel like a waste of money to those receiving them.

Expensive gifts from managers also should be avoided because they might make employees feel obligated to reciprocate. HR should make spending guidelines clear. A $20 maximum is common.

Don’t forget to report to the IRS any cash gifts or gift cards as employee income and notify workers that you are doing so. You might even wish to “gross up” the gift so that employees receive the full intended value after taxes. Holiday hams or a voucher for a turkey at the grocery store are considered de minimus and don’t have to be reported as wages.


































Reprint courtesy of the Society for Human Resources Management