Is Throwing a Holiday Party a Better Option Than Giving Bonuses?

For business owners, the holidays can be highly stressful.  In addition to the regular end of the year considerations, you also have additional money worries.  Business owners are often faced with the prospect of being unable to give out Christmas bonuses due to tight finances or even bad losses. 

However, holiday parties can often be used in lieu of holiday bonuses, and can save business owners the worry that their staff may feel unappreciated after a hard year’s work.

How can business owners use holiday parties to their advantage?  First, if you are unable to afford the usual run of holiday bonuses (which is certainly not inconceivable, given the current state of the economy), you can still show your employees how much you value them by giving them a fun party to attend.

However, business owners should take caution here, as well.  If you go too far with the party, with lavish decorations and over the top entertainment, then this plan can backfire.  If your employees see the party as too costly, they will certainly wonder how you could afford such a shindig, yet be unable to pay their bonuses. 

Holiday parties can also double as award ceremonies, which will always lift employee’s spirits.  Awards are easily more affordable than bonuses, and the cost of the party is certainly going to be less than any bonuses that you might choose to provide your employees.  If you choose to give out awards, it’s always best to give out printed paper certificates than costly gilded statues, as once again employees will resent the statues if they think you spent their bonus check on fancy awards which have no future value.

If they were being honest, most employees will obviously value that bonus check more than a party, but most are willing to sacrifice it if business owners cannot afford to pay out.  In this case, it’s usually best to be honest with your employees.  If your business did not make enough to pay them a bonus, tell them so in plain and simple terms.  Announce the Christmas party about a week after breaking the news that they won’t be getting a bonus, so they will see it as a nice surprise instead of a replacement to their bonus. 

A great way to present the party is along the lines of ‘we can’t afford to have a party, but we’re going to have one anyway, as I think we all deserve one.’  If you have the party during work hours, your staff will see it as a kind of bonus as you’re basically giving them the afternoon off work.  That way, everybody wins.  Your employees feel appreciated, and your business saves money.