As Christmas creeps up on us once again, Kimberley Dondo asks how employers can reward and recognise their staff during the festive season 

As the saying goes, Christmas is a time for giving – but companies are finding they need to be more selective in how they choose to reward their staff, as a one-size-fits-all approach doesn’t make employees feel truly valued.



As more companies embrace a flexible working model, and with an increasing number of employees living an hour or two away from their workplace, enthusiasm for the traditional office Christmas party has diminished. In fact, research from Red Letter Days Motivates shows that a quarter (26%) of UK employees say their employer never throws a Christmas party.

This trend may continue, as for those who have a long way to travel it can be a strain, especially in sectors that are very busy during the Christmas period. Declan Byrne, managing director of One4all, says: “Employees almost feel that they have to attend these Christmas parties as their company has spent quite a lot of money. They feel obliged to attend, and in turn will act as if they were forced to go.

The way forward could be to introduce team-by-team parties in which the teams can arrange a get together that will work for them and let them do their own thing with their assigned budgets.” And for those who choose not to attend the party, the motivation and engagement is lost and they may also feel left out, especially in close-knit workplaces.

An alternative to the party could be throwing a Christmas lunch and then allowing employees to leave early on that day – so no one has gone out of their way or had to make provisions for childcare in order to attend.

With today’s prevalence of flexible working and hot-desking, however, there is an argument that Christmas gatherings are still a great way to bring staff together to celebrate and recognise the achievements of the past year.

James Kelly, director at Red Letter Days Motivates, defends the office Christmas party. He says: “Companies can underestimate the positive effect a Christmas party can have and consider it a luxury, rather than a necessity.

“Bringing employees together at the end of the year and giving them the opportunity to let their hair down will bond peers, create memories and cement teams for the year ahead. If businesses still need reassurance that a party budget will be money well spent, our research revealed that a large number of employees with high engagement levels work for an employer that does throw a festive get-together.”

Although it may seem like an expensive overhead, businesses should see the occasion as an investment. In fact, Red Letter Days Motivates’ research shows 68% of highly engaged employees said their company throws a Christmas party every year, compared to 48% of those with low engagement who said they never have a Christmas party.



All companies, big and small, can do a great deal to make employees feel recognised without costing the company a lot of money, such as creating bespoke gifts. Tracy Finn, head of corporate service at Harrods, says: “One-size-fits-all gifts no longer work in a diverse workforce.”

Nevertheless, vouchers to high-end stores or online retailers are still highly appreciated, especially around the Christmas period, as they can help with the costs that most employees take on at that time of year.

For companies with a small budget, they can still gift their employees with something personalised, such as an engraved bottle of champagne or a beautifully packaged Christmas pudding that comes from a recognised brand.

Regardless of what reward or benefit a company may provide, what is important is that it is presented personally by a senior member of staff. Some companies may think that if they can only afford a small gesture, it’s not worth doing at all – but the gifts don’t need to be expensive. No matter how small the reward is, employees will appreciate the thank you and feel valued.

Marcus Underhill, director of engagement and insights at Staffcare, says: “The key is making every line manager see the value of collaboration, saying thank you and helping people to grow. Engagement at its most basic can’t be subservient to the day job.”



In today’s diverse workplace, companies need to look at what is important to each individual: end-of- year bonuses no longer need to be cash-based but could be three extra days of holiday instead, which some staff members may appreciate more than money that ends up going towards essentials during Christmas time.

“For benefits to assist in attracting, engaging and retaining employees, companies need to have programmes that are balanced and offer choice,” says Debra Corey, group reward director at Reward Gateway.

“This meets the needs of diverse workforces, and also ensures that benefits are seen, used and appreciated throughout the year. This is the new world of flexible benefits, moving to what I call ‘anytime’ benefits, giving employees access to a more balanced portfolio of benefits and choice throughout the year.

She adds: “For instance, many companies use an online discount programme. Employees are motivated every time they save money, with them deciding how and when they want to do so.”

Reward Gateway’s study shows that 59% of Britons would rather work for a business with a culture where they received recognition over a higher salary job where they were not appreciated.

A common and effective tool for continuous and low/no-cost recognition is through a peer-to-peer programme, either through online eCards, a paper-based solution, or an online employee forum.

There is still a place for cash-based rewards, as Kelly points out. He says: “In our research, we asked employees what they would like from their company this Christmas, and not surprisingly, 31% said cash – however, next on the wish list was a gift voucher. A voucher that can be spent across a wide range of brands, shops and restaurants will be much more rewarding than cash, as you can more or less guarantee that it will be spent on your employee – not general expenses.

“A voucher’s more personal too, and your employee will feel recognition towards their company when buying and using their purchase – giving the gift a longer lasting motivational effect. The purchase will also create a memory, which is invaluable when it comes to employee engagement.”


For businesses without a reward budget, offering flexibility around Christmas time can also make employees feel valued.

“Christmas is generally quite a stressful time for people, and for companies that don’t have a reward budget what they can do is provide more flexibility in terms of working hours,” suggests Iain Thomson, director of incentive & recognition, Sodexo Benefits and Rewards Services.

“This would allow employees to attend nativity plays or, like some organisations already do, offer one day off and call it a ‘Christmas shopping day’.”

Gifting during the festive season isn’t just beneficial to the employee: Red Letter Days Motivates’ research reveals that 67% of staff who received some form of a gift from their employer at Christmas felt more motivated to work hard in the New Year.



However, an effective recognition strategy goes beyond just Christmas time: the key is building in continuous, ongoing recognition. A study conducted by Reward Gateway confirms that 84% of employees believe that managers and leaders should spot good work and give praise and thanks whenever it happens, with 80% believing it should happen on a continuous, all-year round basis.

Another issue that is often overlooked by employers is that as workforces become more diverse, not everyone will celebrate Christmas, as it is essentially a Christian holiday.

Staffcare’s Underhill says: “One of the problems with Christmas reward is that in a multi-religious workforce it may not be a relevant time for everyone. So policies may need to recognise the value of other faiths at different times. I am a firm believer that every manager should take a step back at the start and end of each day and ask: ‘Have I done the best I can to keep my staff engaged?’.”

Managers should also consider having some sort of celebration or acknowledgment of other religious holidays, such as Diwali, depending on the make-up of the workforce.

Ultimately, it can be difficult to decide what to send your employees at Christmas as there are lots of options – as well as the challenge of finding the right reward for a diverse workforce.

However, when it comes to giving a gift that keeps on giving, cash offers no benefit at all. More often than not, cash is lost in a pay cheque and spent on Christmas bills such as presents for family and friends, food, and even household utilities.

So don’t be a Scrooge this year. Throw a Christmas party or give your staff members a small gift. Whatever it is, employees value a personal touch that lets them know they are valued as an individual. Companies will certainly find they reap the benefits in the New Year if they do.