Got-to-Have Guide to Holiday Gift-giving for Businesses [Part 2]
Deciding on holiday gifts for employees can be mind-bendingly difficult.
What to get? What size? In what color? How much? How many? HELP!
In the Part 1 post on this topic, we offered guidelines on gift-giving to customers. There are some similar issues with gifting to employees, but also notable differences.
That's why we've created this guide in order to address the many issues involved in gifting to employees, suppliers and others, in order to help you avoid holiday missteps.
Why is gift-giving to employees so important?
Why are gifts to anyone important?
Because you value the relationship.
Because your business could not succeed without the efforts of your employees.
Because Ebenezer Scrooge (before the visits from Christmases Past, Present and Future) was a lousy boss, and you don't want to be that kind of boss.
Because you want to end 2017 on a high note by saying "thank you" and "you're important to me" in a concrete way.
What are the pitfalls involved in gifting and how can you avoid them?
There's a lot to consider, but with a little attention to detail, you can avoid the following gifting pitfalls.
Pitfall: Giving gifts that are again company policy/tradition
Make sure you know your company's policies about what is and isn't appropriate regarding gifts (giving and receiving). Maybe a chat with the HR people is in order, if you're unclear or new to the company. You might also talk with a longtime employee in the company who can fill you in on any unwritten rules, and can also probably tell you stories of past holiday gift-giving disasters--always useful info.
If you give to one, you should give to all. Coworkers talk, and you don't want anyone on your staff to feel slighted. To avoid overlooking anyone, keep a running list of employees and check it carefully before sending out cards or gifts.
Pitfall: Sexual innuendo and funny stuff
But that lace chemise is so lovely, and you're sure that your assistant would love it.
Just... don't. Stay away from any gift that is too intimate or personal, including jewelry, perfume or cologne.
Avoid gag gifts as well--it's too hard to know for sure if someone will take offense or be embarrassed.
Business and career coach Laura Lee Rose offers this advice on Monster.com:
"When you're giving gifts at a company-sponsored event -- even if it's not hosted at the office -- you should only gift items that would be appropriate to show at a business meeting. ... There are a lot of safe gift options that won't violate any company policies or 'step on the company's legal obligations to provide a safe, secure and friendly work environment.'"
Pitfall: Clumsy gift exchanges
Sometimes employees have a tradition of planning a gift exchange at the office. It's a good idea for a company to provide some rules for these events, such as: setting a limit on cost of gifts; having the employees run the gift exchange themselves; listing examples of appropriate and inappropriate gifts as guidelines; and requiring a sign-up sheet so that employees can "opt in" to the exchange (instead of requiring employees to "opt out," which can be awkward). Whether or not you, as their boss, participate is up to you.
Pitfall: Gifts that are too expensive
Spend too much on a gift for an employee and you run the risk of embarrassing them. According to Harley Storrings, labor and management attorney at Arnstein and Lehr, you'll want to "...make sure you keep to a modest budget--you do not want to give extravagant gifts which might make an employee feel compelled to reciprocate the gesture."
What is the tax situation regarding gifts to employees?
This is a two-fold issue. Gifts may be:
#1 Taxable to the employee
In the U.S., gifts that cost more than $25 are regarded as taxable income when offered to employees, and are subject to local and federal withholding taxes.
In Canada, gifts given to employees, with some exemptions, are considered to be taxable benefits by the Canada Revenue Agency.
#2 Tax deductible for you as a business expense
In the U.S., you can deduct up to $25 per employee, per year, for gifts.
In Canada, there may be tax advantages to giving employees gifts rather than cash bonuses. You can deduct the total cost of the gift, yet the employee isn't required to declare it as taxable income (as they would a bonus). For more on this issue, see the Balance.com article, "Employee Gifts as Tax Deductions in Canada."
Note: ALWAYS consult your tax professional regarding gifts and deductions.
What gifts work best for employees?
A few things that are good to know include:
According to an article in U.S. News and World Report, a general rule is that the boss gives gifts to employees, but employees are not expected to give gifts to their boss.
Many employers opt to give the same gift to their employees to avoid hard feelings and sidestep any suggestion of favoritism.
Gifts of food are a good way to thank employees and can be gifted individually or for a group. If you're giving a food basket to a group, for example,you can have it delivered to the break room with a handwritten note expressing appreciation for the group's contributions to the company all year long.
However, there may be members of your staff whose role and/or performance warrants something a bit more special. In that case, it's time to get creative and find something that says, "thanks!" is a big (not necessarily expensive) way.
Your employees probably leave clues all year long as to what their interests are, what problems they have and what might make a great gift for them. Have you been paying attention?
One good way to get an idea about what somebody might like for a gift is to ask their coworkers. Let's say that you've noticed your assistant is good buddies with that guy in purchasing. Pop in on that guy and ask, "What would make a good gift for X?" Not only will you likely get good ideas, you'll also give a friend the chance to be in on the nice surprise.
TIP: If you want to give a more unique (and potentially more expensive) gift to an employee, be sure to present it to him/her in the privacy of your (or their) office, and not in front of coworkers.
The best gifts are customized to the recipient
Got a staff member who is perpetually complaining about how they never get a good meal?
Help them out with a gift of meal kits. This is a great choice for someone who doesn't have time to shop for groceries, or lacks skills in the kitchen. These services deliver fresh ingredients (and easy step-by-step recipes) straight to your employee's door.
According to a recent Harris poll, 1 in 4 adults signed up for meal delivery in 2016. This is a particularly popular option for your employees who are between 25 and 44 years old, as those are the people who have really gotten on board with this trend.
Which meal delivery service? There are quite a few to choose from.
Make Good Food is Canada's #1 Meal Kit service.
In the U.S., Money magazine has compiled lots of options with information to help you choose.
Want to get a gift for that employee whose cell phone's battery is always dead?
Simple--get him a solar battery pack and he'll be good to go any day of the week.
Office-friendly gifts are always a good option too--useful and professional.
Choose anything that will fit in the workplace setting, such as mugs, tumblers, cube calendars or even a live airplant terrarium.
Unique desk signs can be fun, like this one from Uncommon Goods that says, "I'm kind of a big deal."
Or how about a quality leather journal for an employee who is an aspiring writer?
A gift of sports, theater or concert tickets is another popular option, particularly when chosen based on the employee's passions. Present the tickets in a unique way, for maximum impact.
Suppose you have an employee who is a Shakespeare fan. Here's where you get creative:'
Buy two tickets to a local production of Hamlet (you don't want him to go alone, do you?)
Slip the tickets inside a copy of The Complete Plays in One Sitting.
Finish it off with a greeting card and handwritten note, and the gift is guaranteed never to be forgotten!
Need still more ideas for good presents? Here's a list of gifts under $25 from Small Biz Trends.
What about swag?
Do promotional items make good gifts?
Maybe--if the item is useful/cool/good quality and the employee doesn't already have three of them in his drawer.
According to Market Tango, items such as branded gift cards, speakers/headphones or a branded Moleskin notebook can make a good employee gift. Just be sure to select products that are compatible with your mission and are of good quality.
Gift cards to the rescue?
As mentioned in the Got-to-Have Guide to Holiday Gift-Giving for Businesses: Part 1 post, gift cards are an easy, but sometimes not very special, gift, and frequently don't get used.
TIP: If you decide you still want to go ahead with giving gift cards, make sure you give the right ones.
LendEdu has done all the research and has a list of the Best Gift Cards for 2017. Skip #5 on the list, though: Victoria's Secret--for obvious reasons!
What about donating to a charity on the employee's behalf?
This is always a good option.
A couple of things to keep in mind: a donation on their behalf will be more meaningful to the employee if you choose a charity or nonprofit organization that matches their interests (not necessarily yours). Avoid nonprofit entities with religious or political associations.
Here's something a little out of the ordinary:
LottoLove -- scratch cards that give charitable gifts. Every card is a winner and with every card sold a nonprofit receives money to help people get clean water, solar light, food or literacy tools. LottoLove also has a corporate giving angle, so you can give customized cards to all of your staff, suppliers, etc.
Yet another creative option is to turn office gift-giving outward. In lieu of giving each other gifts, you and your staff could give gifts to benefit others in your community. How about gathering toys for the firefighter's toy drive, or collecting canned goods for the food bank? Add in an activity--face painting at the Christmas parade or maintaining trails at a nearby park--and you might even create a tradition that beats all heck out of the annual holiday party, while also providing good PR for your company.
Who are the other people you should remember during the holidays?
The list could include service providers such as consultants, suppliers, virtual assistants and postal workers. You'll want to prioritize this list, based on which service providers deliver services that are important to your business, plus the frequency and length of their service.
Do you tip them each time they provide service? If you do, a holiday tip isn't necessary. You can still give them a small gift to say a special holiday "thank you."
Is it almost always the same person providing the service? If yes, then tip (or gift) away. If you see a different person all the time, there's no obligation to give.
Do they provide good service? If they are easy to work with, flexible and provide excellent service, then you should definitely put them on the list. If not, then don't.
Do they own the business? It's not customary to tip the owner of a business.
TIP on TIPPING: If you don't know whether or not the person can legally accept a holiday tip or gift, give the company a call and inquire about their policies. The last thing you want is for a worker to lose their job because they accepted something they shouldn't have. Also, always put a tip inside an envelope with a greeting card. It's just more respectful.
In the U.S.:
Federal regulations limit USPS employees from accepting gifts valued at more than $20. Cash, checks or gift cards cannot be accepted in any amount.
According to the Canada Post Code of Conduct, employees can accept incidental gifts, customary hospitality and other benefits of nominal value (no more than $100).
Gifting to FedEx and UPS drivers:
In an article in Huffington Post, a representative from FedEx Global Communications stated that "Gifts of cash or cash equivalents such as gift cards or gift certificates must never be accepted. Employees are allowed to accept a nominal gift valued at up to $75, no cash."
A representative from UPS Public Relations said, "At UPS we train our drivers to politely decline tips, however, when a customer insists, we allow our folks to accept nominal gratuities. We do not suggest an amount or range for monetary gratuities. Our drivers do receive heartfelt and sincere gifts of baked goods, knitted items and even invitations to holiday parties. Ultimately we let them use their own judgment about whether or not to accept or decline a gift."
Remember that even a small item or a card, when accompanied with a sincere and handwritten note, can make people feel appreciated.
Off you go...
Armed with this guide, you're ready to get gifting.
Let us help you.
At Almac Imports we work with individuals and businesses--large, small and in between--to provide the baskets, boxes and packaging accessories they need, all at unbeatable prices.
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