What Is the Average Employee Christmas Bonus?

The amount of a Christmas bonus that an employee can expect varies. Although not every company offers holiday bonuses, bonuses are a well-known custom in the financial industry.

It’s becoming increasingly difficult to locate a company that consistently pays its employees holiday bonuses in the business sector. Because they are more subject to consumer spending habits and volatile economic markets, small firms are less likely to offer a holiday bonus. As the fiscal year draws to a close, a small business may find it necessary to cut costs, particularly when it comes to employee holiday benefits. However, it’s vital to note that a holiday bonus and a year-end incentive are not the same thing.

According to a 2016 Bank of America poll, 32% of employers planned to grant bonuses, down from 52% in 2015, and 28% had no intentions to provide holiday benefits to their employees. If a corporation does decide to give its staff, there are various options available.

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A Financial Bonus

An end-of-year bonus of 10 to 20% of an employee’s annual income may be offered by a corporation. According to a 2016 Business Know-How study of readers who are business owners, 75% of organisations with 100 or fewer employees planned to give cash incentives. A monetary incentive can range from $50 to $5,000, depending on the firm and its profitability, with the average bonus being $300. According to an Accounting Principles poll of large and small businesses conducted in October 2016, 3% of employers planned to pay cash bonuses to employees ranging from $100 to $499, with 50% aiming for $500 or more.

An employer may calculate a yearly bonus for salaried staff based on a percentage of their base income, but the numbers vary per company. The lowest number was one percent of annual compensation, about comparable to a half-salary, week’s and the maximum was ten percent or more, according to the Business Know-How survey. For full-time employees, the most typical bonus reward was one or two weeks’ salary.

A Bonus for Performance

In lieu of a holiday bonus, an employer may pay a performance-based incentive to its employees. This form of bonus is intended to inspire employees at the end of the year to help the company meet its fiscal goals. Some businesses issue incentive bonuses instead of Christmas bonuses, although this approach might lead to considerable employee unhappiness. Many businesses, however, distinguish pay-for-performance incentives from holiday bonuses, with the latter serving as a considerate expression of thanks and appreciation.

A Non-cash Present

More than 43% of businesses surveyed by Business Know-How said they planned to give non-cash presents or other bonuses to their employees during the Christmas season. According to Inc.com’s study of employees, the most valued non-cash presents are:

Grocery, department, and online retail gift cards

Paid vacation

Logoed company apparel or stadium blankets

Hampers stuffed with things they wouldn’t buy for themselves, such organic juice or high-end chocolates

Holiday gathering

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