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Christmas Bonuses?
An anonymous reader asks: "I run a small startup company who was able to turn a buck during this past year. To say 'Thank you' to the employees who put in so much time and effort to get us financially stable I would like to give them a Christmas bonus. However, I've never received one before, so what is appropriate? I have 5 employees and I want to give them all the same bonus, but while I can afford about $1500 a person, is that too much? Would gifts be more appropriate then money? What are some bonuses the Slashdot crowd has received in the past?"
How about, divide profit by 2, then divide that by the # of people to get a bonus?
I think that $500/person would be quite acceptable...
Will you hire me? ;-)
Take that $1500 per employee, give them a $500 or so christmas bonus, then save the rest for further bonuses.
One thing I really like about my employer is we get a christmas bonus, a back to school bonus, a summer bonus, etc. They are all in the couple hundred dollar range, but they alwas seem to come at the right times, and everyone appricates it.
symetrix. We are building a religion, a limited edition.
As a lowly emplyee, I highly respect the fact you are doing this. Congrats!
/end rant
I've been at the same job for 3 1/2 years and three years ago I received about $400 I believe, and then $0 and $0, even though I got 'promoted' and we're making more money. It's a small company and I feel like shit because I also probably haven't received a raise in that long as well. Anyways,
$1500 sounds awsome!
HURD - Hurd's Under Research & Development
Obviously how exorbant a $1,500 bonus is depends on the regional economy. $1,500 would be a dream come true for me, here in Wisconsin. If you're in California, I'd say $1,000 would be a good bonus.
Of course, this assumes they don't have some form of profit sharing. If they do, cut it in half.
I've never received larger than 2% of my salary during bonus time. I suspect $500 is 'enough', but if you can afford to give $1,500, then why not? There is no such thing as 'too much' unless it means you'll have to skimp on other business needs next year.
You might also consider giving gifts in addition to a bonus. The percieved value of a gift is often greater than it's actual cost - spend $400 on an IPOD for each employee and give them a $500 bonus.
Just don't give them gifts that are directly related to their daily work - it'll seem cheap (ie, never give your wife a vacuum cleaner as a 'gift', under pain of death)
-Adam
Last Christmas everyone at our small (50 person) company got fairly nice bonuses. Right after the new year, several business deals fell through, and many had to be laid off. The lay-offs may have been avoided if the bonuses weren't so high. The smaller you are, and the fewer clients you have, the more likely you are to find yourself in a similar situation. So, yes, give bonuses, but don't go overboard--you and your employees may end up regretting it.
Well, if you decide that the health of the company requires that you put some of that potential bonus money away for future needs... you better hope none of your employees reads Slashdot and gets bitter that they didn't get the full $1500!
Bonuses are great, but the have a habit of becomming an institution at many small companies that owners use to "beat-up" people with rather than simply a "gift". Example: I work at a company that used to [from older employees] give out good bonuses. Well, they use it as a "recruiting" tool [blah, blah] to get you to work there, but last year in particular, they beat everyone up all year about it. "You won't get bonus unless..." That lead to all sorts of stupid statements from management about "lazy" and "stupid" [but working 60 hrs./week!] employees. It was a nightmare...It was abusive. If they didn't want to do them, then just say so...execpt they were "promising" them with all sorts of "strings". Promise yourself right now NEVER to do that! it leads to a good thing for the employees just turning you into a tightwad arse. If you're going to do it, make it no-strings-attached, this-time-only. Don't promise it if you can't expect to do it again, and don't hold it out there if you don't intend to deliver...
in short, keep it simple.
The company I work for has a sales sharing plan paid out every two quarters. Of course one of these coincides with Christmas. A portion of the revenues are shared equally among all employees with over a year of service. Employees under a year of service get a half share (prorated for the first half year). Fortunately we are having one of our best years ever and the summer bonus was excellent. The X-mass bonus is predicted to be even better. In the past the bonus has been both below and above $1500.00 CDN. Therefore the amount suggested by the story poster is in my opinion quite respactable. I do suggest that in the future the poster should tie the bonus to the company's performance by a mathematical formula so that there is a definite motivational reason for the employees to put forth that little bit extra.
134340: I am not a number. I am a free planet!
I agree with those advocating about a $500 bonus, and keeping some of that money back for future "incentives". $500 is a great bonus for a small business to be able to manage, so the employees will appreciate it. Then, with the rest of the money, you'll be able to save up and plan for future bonuses. Being able to give a bonus every 3 or 6 months is a great way to motivate people!
I've gotten $100 bonuses in the past, and although they represented maybe $1 per hour of uncompensated overtime put in, it meant something to me to at least be recognized, and to have some "mad" money to spend.
Holding back money and being able to *regularly* give bonuses helps a lot too -- once people get bonuses, especially around a certain time of the year, they get to like them... being able to make this a regular thing (given that the company has good performance) will go a long way towards retaining good employees.
It's a strange world -- let's keep it that way
"You can afford"?
That's the big thing. Does the company have a decent cash reserve to deal with any possible problems, as well as a stable cash flow? I'm sure that in the end, they'd prefer having a job for the long term than the cash now.
Anything in the range of one pay period should be considered a rather reasonable bonus IMO.
Why not bring good for both of you? If this is a tech company upgrade their workstations. This keeps the money in the company but it also boosts the moral of workers and feels like you often think about them and the long hours you put in. It would work even better if you were to suprise them with say a nice dinner, and have a bunch of new equipment at the front of the room. If you want your employees to choose have a catalog with ONLY their options avaialble to them so they can pick and choose what they want out of what you deem appropriate.
-- botsex is {grep;touch;strip;unzip;head;mount}
$500 or so as a bonus, an extra day or 2 vacation at christmas time, a $100 - $200 gift for each employee, maybe throw a small holiday party for your employees and their families at a nice local hotel(where you could present their gifts and bonus checks as well as announce extra vacation time for employees). And make sure to put some away for the future.
You would know better what your employees would appreciate. 5 employees are easy to please...try pleasing 200+ employees...
By making sure to spend a little in a few different ways, each of your employees will find some benefit in the way you have spent the money. This also requires you to do a bit more work than a gift or bonus alone, but it will likely not go unnoticed.
That is an amount that they have to declare as income, which means that after taxes they get about 800 or 900. I'd go for something smaller. Throw a party or take them to a really, really expensive and nice restaurant. Then give them about $50 to $200 gift cards. There is an american express card that can be used like a gift card in several places. Basically 'mall money' that can be used at many mall stores. This way they get some kind of bonus but it is more of a gift that they don't have to declare on their taxes.
Only 'flamers' flame!
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Considering that a poor American is much better off than like 3/4 of the world, that extra money would make a huge difference in other peoples lives who are much less fortunate. Not to mention there might be a tax benefit in there. I guess consider it an alternative to putting an extra grand in people's pockets who are already "rich" by any standard in the world.
The sending of this message pretty much inconveniences everyone involved.
Here's a real winner! Give each employee one of those round cookie tins with the different kinds of butter cookies. I really like the flat ones with crunchy sugar crystals on top. Since you give it to them at work, they can keep it there all for themselves and not have the kids inhale them within five minutes. The decorative tins also add a truly festive air to the office, well into July.
If that's not an option, then hand out bulk Christmas cards containing a $25 certificate for a small local restaurant. If they haven't ever heard of "Ma's Pasta Shop" so much the better, they'll welcome the push to get out and experience new things! They may even go back, having discovered a new favorite restaurant; the gift that keeps on giving!
Seriously though; employees really do appreciate a generous gift, and will remember it for the rest of the year. I'd suggest giving part of the gift in cash, maybe $750 to $1000. Also have some seasonal gourmet foods sent to their home address; Honeybaked Ham gift packs are always fantastically delicious, and Pittman & Davis oranges and red grapefruit are the largest and sweetest you'll ever see. Remember, it's not all about the employee's reward and morale boost. This is an opportunity to show his family that you care about both him and his family, and the workplace isn't just where Daddy stays late and comes home tired and grumpy.
Also remember to give the cash bonus well in advance of the actual holiday. Not only do you catch the potential celebrators of other religious holidays, but you give them a welcome shot of cash for the gift-shopping season, which is often very stressful for tight budgets.
...
Whores!
Lots and lots of whores!
You run a tech company, right?
Just imagine the loyalty they'll feel toward you, once they can honestly tell their Dungeons & Dragons buddies that they finally lost their virginity in real life.
Opinions on the Twiddler2 hand-held keyboard?
Just because you can afford 1500$/employee doesn't mean you have to give it to them.
If it was up to me, I'd give them 750$~ or so and a 3 or 4day weekend for each of them when time allows.
I only suggest this because the company I used to work, everyone got a $5000 bonus every year (or more). Then one year it ended up being 3000$, even though the company did better then ever, and we were all bummed out. I know I know, flame me for bitching about a 3k bonus instead of 5, but when you come to expect it for bills and such and it doesn't happen, it's a blow to moral. So just start em out small, make sure you can afford it. Remember, even though a bonus is basically a "thanks!" your employees will get used to it, and when you hit a bad year (if) and can't give out bonuses, it'll be a slam to their moral. So start out small, make sure you can cover things, then slowly increase it.
Looking for hardware (Currently need: Large Etch-a-Sketch) Have one? See my journal!
I would recommend the following:
* have an awesome Christmas party for employee's and their significant others (~$150-$250 per couple)
* upgrade employee's computers/software where they desire (~$600)
* give them the rest in $cash.
Let your employees know how much you value their contributions and friendship. Give each a Christmas card with a meaningful message.
With luck, every employee will be with you next year. Make sure they know that "this year has been good for the company." If you do this, you will not set up expectations for following years, especially if your company does not do as well.
PS: You don't have an office in Melbourne, Australia do you?
Whatever the bonus, go to the bank and get a bunch of $1 bills. If the volume is big enough, go down to Office Max and get a bunch of attache cases and fill it with the dollar bills. If you really want to screw with people layer $20s on the top... Or have some fun and find $2 bills...
Bleh!
I hope you are able to ignore all of the silly suggestions to donote to charities, upgrade workstations, and give non-cash gifts.
Donating to a charity in someone's behalf is one of those anti-gifts. It's a gift that isn't a gift. It says, "Here's some cash but you can't have it." And if you chose the charity, you're saying "And I won't even let you pick where it goes." Lovely sentiment.
Upgrading a workstation is, as someone else pointed out, like buying your wife a vacuum cleaner. Keeping workstations fast and efficient is in *your* best interest, and I'll bet you get to write-off the depreciation. It's another anti-gift.
I believe those who say they really appreciate non-cash gifts, but not everyone does. Do you really want to roll the dice? I've sure received a lot of stuff that just missed the mark. Let your employees get something they want, not something the boss wants. Besides, I have a suspicion that a gift large enough to be a decent bonus is probably taxable anyhow. A gift that costs cash to receive would be a huge anti-gift.
Cash is king. It says, "Thanks for all the hard work, and sorry about the chunk the tax man takes (can't help that), and I know you'll make good use of this."
My suggestion would be to give them each a 40G iPod and take them out to a nice lunch to show your appreciation.
Seriously, once the cash is gone - it's forgotten. The iPod will be there all year round.
Hmm - it might be the same as things are in Belgium though. Here we get paid a 13 month year, and the 13th month is at the end of November. It's not a bonus, it's part of our salary...
(Actually it's about 13.9 months a year, because we get a similar "holiday pay" in the summer - effectively we get paid double for holiday time, with half of the double pay being paid as if you're working during your holiday, and half in a lump sum in May or June...)
Bonuses are seperate to that...and at least for me are not paid around Christmas as we already have the boost from the 13th month. Do a web search for more info.
-- Pete.
Monochrome - Probably the UK's largest internet BBS
Or you could just put a big pile of money in the middle of office and say help yourselves. Be a little more creative and your employees will aprechiate it.
Here's the thing. If you don't tell people they are getting a bonus, and then you give them one, that's great. However, next year you may not be so financially black (hopefully you are though) so communication is very important. Giving surprise bonuses without prior "warning" can lead to frustration next year when no prior warning is given, and then no bonus is given.
What's worse, is when bonuses are written into contracts and initial hire communications, but then completely dropped around the holiday times (like at my company). Nothing spells plummeting moral like breaking promises, especially when they're promises about money.
I guess what i'm saying, is be careful that you don't end up in a situation where expectation is set through non-communicative means. "Well, we got on last year, and i think we're doing well this year..." is trouble.
Be clear, concise, and honest about bonus policies.
There are 01 types of people in this world. Those that understand binary, and me.
While once employed by a large financial company,
I've received and also allocated bonuses that were:
1) a percentage of my salary
2) a percentage of a pool allocated to my department
3) an extra paycheck
for percentages, a 5-10% of the monthly salary is was not unusual.
Money is much more useful then other gifts.
Thank you for being kind to your employees.
Peter AI6PG
i'd also attach a form for the Human Fund.
this is just a placeholder till i send back my real sig from the future.
I've worked for a number of years at a small company where we do annual profit-sharing bonuses, and it works well as a motivational tool, and everyone likes the extra money at the end of the fiscal year. But we also are reminded that they *are* bonuses, and if business gets tight, the bonus can and has been $0 in the past (thankfully, this is rarely the case)
Good bonuses I have received: 1) $1000 2) $5000 3) $10000 4) $25 grocery store gift certificate 5) Nothing (see below, as nothing is certainly better then the bad bonuses) Bad bonuses: 1) a box of the ugliest flowers (I use the term loosely) I have seen. They were from Hawii and had to be at least $100, I did a little research. 2) A (wait for it) small dietetic fruit/snack basket. And bad, sugarless, flavorless snacks at that. There are others, but the bad ones really stand out. The were both from a company that "Flip" used to run and sold to CA. I found them insulting and incredibly stupid. Better to have gotten nothing. To the original poster, $1500 is a very nice bonus. Its enough to make a dent in bills or to buy something nice. That makes it a good indication of appreciation.
First, remember that you will be setting a precedent. Too generous now may make you look cheap next year.
Second, Cash is king. It allows the recipient to best decide what's good for them, and meet their own needs, not eat a ridiculously overpriced meal on an inconvenient night.
That being said, keep in mind the tax ramifications of large cash gifts. Maybe giving everyone a $1500 raise would be a more efficient way to convey the money.
Third, what else can you give to improve your workers' lot in life? Do you provide a company match towards insurance coverage? Retirement contributions? If you're a small startup, you probably don't have insurance offerings for them -- add that as a benefit, and pitch in $1500 or so per employee towards the cost. That will make many people very happy.
Finally, Give them time off. Shut down between Christmas and New Years Day, or maybe just for a couple of days. Startups are notorious for working people to death, sometimes for good reason, and while you seem to care enough about your employees not to do that more than necessary, it would benefit them and you to give them some more time off to rest, recharge, and tend to their homelives. Maybe add a day to their annual allotment as well!
And Merry Christmas. Please remain in this employee-centric frame of mind as you grow your business and become a captain of industry.
Invest the $7,500 back into the company but let them decide how to invest it.
... in short they have the power to override any purchase veto they didn't particularly agree with. Better now they can go get that toy they have been wanting SOOO badly without convincing anybody that they need it - I really want a SMP box but there is no way I could convince my boss that I need one.
... but a twin 18" LCD display says 'I am special' for a very long time and serves as a daily reminder that what is good for the company is good for the employee.
Just a thought : every employee secretly wishes he had some power to do something a little bit different, has something that drives him at work. Give them power, and money is power.
Five $1,500 Amex gift cards to be used 'for business expenses' (that part means you get to write it off on your taxes if you get some supporting paperwork, and they don't have to pay $600 of it to the IRS) empower them mightily (money = power). A case of the good coffee, ten cases of soda that they like for the fridge, a nice twin 18" LCD monitor setup or Bose noise cancelling headset, a DVD burner for their individual workstation, more RAM for the server or their machine, one of those nifty HyperThreading new P4 machines, a session of training, 7 MCSE exams, a new 100 megabit switch to replace the hub, wifi gear, iPod, handheld iPaq, work related hardware for their home office, reference materials
This borders on the 'new vacuum cleaner for the wife' but remember that if they are hardcore techies they LIKE new toys even if they are work related toys. After regular ol' cash is spent (once it hits the bank and mixes with all the other cash it isn't the same anymore) it is forgotten
Because it is something they are spending to improve their quality of life issues at work (and the IRS doesn't steal 40% of it, and their wife doesn't get to steal the rest) they are justified (guilt free!) to spend it on toys that they really, really want.
Finally because it doesn't actually affect their bottom line at home they can't become dependant on the bonus money in their annual budget and if this 'benefit' is only half the size next year (or zero if biz is bad) they are not going to be nearly bent out of shape.
Glonoinha the MebiByte Slayer
1001 ways to reward employees
by Bob Nelson, ISBN 1-56305-339-X is a good resource that might help you determine what to give.
Amazon link
Regards, Anomaly
But Herr Heisenberg, how does the electron know when I'm looking?
I know that everyone else would disagree with me but seriously consider not giving out bonuses.
Throw a small party/give a small gift but keep the money and use it to grow the business. Give them the gift of hopefully better job security.
The surprise isn't how often we make bad choices; the surprise is how seldom they defeat us.
Wow. That's really a god idea. Now, before I get flamed for this, let me explain.
I'm sure I'm not the only one (at least I hope I'm not) who has taken a bonus/windfall and bought a tech toy that's marginally useful for work but might not have a really solid business need. I once took a bonus and bought a really kick-ass PDA, which I thine used for some work purposed as well as all the fun stuff I wanted it for.
There's a ton of things that would fall into this category. Maybe a trip to (insert trade show at fun location), a laptop for somebody who might not ordinarily get one, and damn near everything in the ThinkGeek store.
Now I really wish I worked where I would get a bonus. Maybe next job...
Better do not give everything you can - set a lower level, just like 500$/person. Why? Because when (if) next year your company will have worse results - and people will get less for xmas bonuses - they will be disapointed. So better give 500 and save the rest for the next year xmas party :-) :-)
By the way, are you hiring?
So what good is that to those of us who have a life outside the office? For most of us, work is a means to an end. What you're suggesting isn't what I would consider a bonus. Sure, it would make some aspect of my job better...but for most of us happiness in our life away from work is far more important than happiness at work.
For most of us, work is a means to an end. What you're suggesting isn't what I would consider a bonus.
I don't know whether your claim of "most of us" above is accurate or not, but it sure doesn't apply to me.
The hours of my life matter a lot to me. I spend too many hours at work to NOT treat it as part of my "real life". I look for work that I want to do as an integral part of living my life, not as a "means to an end".
If I can't find such work, that's a hardship that I work to try to overcome if I can. Sometimes I can't for a while, but I don't shrug it off as "work is just a means to an end".
Most of the time, I care how it goes, and I value being given authority and resources that give me more leverage over this important portion of my life.
An employer who provided a bonus of this sort to me would be giving me some resources for improving things in an area of my life that I care about, and this would matter to me.
"Those who have never entered upon scientific pursuits know not a tithe of the poetry by which they are surrounded."
Members describe bonus plans that actually work: http://techrepublic.com.com/5102-6331-5034644.html
Good points and a good starting place to think about what you want to accomplish with a bonus.
Hey - if you are going to give them a bone, you might as well treat them like you are Pavlov too. Let them know exactly what you liked about their performance and then set them up on how you want them to do even better next year.
Money is always the best present, because people can use it. Though it doesn't evoke the most appreciation. Appreciation usually comes from presents, because the person is tied to the present.
If you have 5 employees and can afford $1500, that's $7500. It can be split up three ways, money (for a token gift), a gift (to show appreciation), and a better workplace.
That said, each person could receive $300. (It's a nice token that'll give them a night on the town, plus help then buy their personal latest toy, or make another car payment). Then you could spend another $200 each on gifts, such as tickets to a concert, better computer monitors, or some gadget. That'll leave about $5000. With that, buy a coke machine (from Coke, $750 startup fee, plus $75/mo) plumbing will cost about $3000. Syrup costs about $40 a box, and CO2 (after the outlay for the canister of about $100) will cost about $20 to refill. That'll leave about $1000. Use that to buy a refrigerator/freezer, and put ice cream and treats in it weekly.
If you do that, or something like it, you will show appreciation, they will get money and gifts, and their entire working experience (which is exactly what you re showing appreciation for) will be enhanced, greatly. Free food is the cheapest, and probably most successful, way to make employees happy. The Coke machine is something i once had, and there is nothing like filling up a coke from your own personal fountain.
Have you read my journal today?
I've worked at a graphic design print shop for about a year and a half now. Last year we had a great year because some of our competitors left town and we were able to produce some really nice, public work on a few projects. So our boss gave us two days off before Christmas but wante dus to have an office party with our wives, girlfriends, friends, and ex-coworkers (that we're on good terms with). So me and the guys got a few days off and came back for the Christmas party on a Friday night. When we came in we noticed that all of our workstations had been supremely upgraded. Gone were our old macs. We got brand new G4s with hi def monitors, ipods, huge Wacom tablets (special ordered from Wacom with our company logo on them), 5.1 speaker systems, great personal headphones, new office phones, new high back leather chairs. The works. On top of that he gave us each $500 bonuses and $200 business check cards so we could buy more stuff for our workstations. Needless to say we were raelly happy and not one of us has quit in the last year. Sure, we know we're not getting new G5s this Christmas and we already have all of our great goodies, but we know our boss respects us and wants us to be happy at work. He could have given us bigger bonuses and gotten us the computers later, but he wanted us to be really happy and motivated for the next year. Plus, I would have spent all that money on a bunch of crap anyways, but now I have the work area possible, a personal ipod, and happy worokers to deal with everyday. Wouldn't give it up for anything.
It's not stupid. It's advanced.
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