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Should Your Biz Forgo Holiday Parties, Bonuses?

By Brett Snider, Esq. on December 17, 2013 | Last updated on March 21, 2019

As the holidays draw nigh, many business owners are choosing to forgo parties and holiday bonuses, worried about a slowly recovering economy.

While it may seem Scrooge-y, it might make financial sense to cut back on extra spending when profits are slim to nil. An Office Depot survey found that 57 percent of businesses had "no plans to buy holiday gifts for clients or staff," reports the Pittsburgh Post-Gazette.

Should your small business ditch the festivities and bonuses this year?

Holiday Parties Increase Costs, Liabilities

According to an American Express survey, 32 percent of business owners planned to throw a holiday party in 2013, down 8 percent from 2012, reports the Post-Gazette.

Why the decline?

Many of the legal concerns surrounding a small business throwing a holiday party suggest choosing a venue outside the office, which may double or triple the costs of a normal office party. If businesses choose an office location for their holiday fetes to cut down on costs, even the fuss over the decorations can have an employer wishing the party never happened.

If a business' outlook in the New Year isn't exactly sunny, the prospect of an expensive, legally fraught holiday party isn't exactly an attractive one.

Scrooging on Bonuses

While it is entirely legal for you to force your employees to work through Christmas, a far more upsetting Grinch-like move is to forgo holiday bonuses.

Bonuses, by their very definition, are not mandated, and according to the AmEx survey, only about one in four employers planned to give their staff year-end bonuses, reports the Post-Gazette. This is in contrast to 2009, when it seemed that holiday bonuses were on the rise.

Many employers may choose to give clients and customers gifts as opposed to employee bonuses when times are tight, especially if customer service is crucial to business.

What About Employee Morale?

Even without parties or bonuses, there are some cost-effective ways to show your employees you care.

A holiday potluck is a great way to bring employees together without spending too much scratch, and maybe you could raffle off some low-cost holiday-themed items (a DVD of "Home Alone 2" perhaps?)

Your office could also host a charity food or clothes drive for underprivileged families over the holidays. A sizeable gift to a local charity will ensure employees and employers feel the spirit of the season.

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