UK employers spread festive cheer by doubling bonuses
Bosses are planning to thank workers after a successful 2015 by doubling the number of Christmas bonuses paid out this December, research reveals. The annual study by the Prepaid International Forum (PIF) of 2,000 UK workplaces reveals a 112% increase in the number of employees due to receive a festive treat. One in seven workers are due to get a Christmas bonus, compared to just one in fourteen in 2014.
The large increase is attributed to improving economic conditions as well as increasing uptake of reward and recognition schemes by UK businesses.
Alastair Graham, spokesperson for PIF, says: “Employers are wise to the importance of thanking workers for their hard work, especially at Christmas when it’s traditional to add a little extra to people’s pay packets.
“However, we’re seeing changes to how these bonuses are structured as employers look to increase their impact on motivation and productivity.
“The biggest development is in the growth of prepaid reward cards through which MasterCard predicts UK business will pay out £400million in bonuses a year by 2017.
“People shouldn’t be surprised if they get an extra piece of plastic for their wallet at Christmas instead of a larger number at the bottom of their pay slip.
“Almost three-quarters of companies (74.66%) say that they favour this method of saying thank you because they have a greater impact on staff morale and motivation, not least because they prevent bonuses simply being absorbed into meeting the costs of Christmas rather than going towards an actual treat.”
Bosses not planning on paying a Christmas bonus may wish to reconsider before it’s too late. For example, staff getting a Christmas bonus in 2015 will be significantly less likely to move to a different job in 2016. 71% of people surveyed said that they would actually turn down the chance of earning more money rather than leave a company that regularly thanks them for their efforts*. Evidence also suggests that an effective ‘thank you’ from bosses increases productivity by as much as 44%.
The impact of such bonuses on overall productivity has been recognised by the government in Ireland, who allow businesses to reward employees with €250 in non-cash bonuses each year free of tax.
It’s not too late for bosses wishing to jump on the bandwagon, with one provider, One4All Rewards, launching an online ordering tool for SME businesses looking to spread some last-minute festive cheer.
Commenting at the launch Declan Byrne, Managing Director of One4all Rewards said, “Christmas is a time to reflect on the year’s achievements and reward your staff that have driven that success. A festive thank you will be repaid in ongoing loyalty and increased commitment to the business by high performers.”
There are also innovative online solutions such as E-spree, which allow rewards to be redeemed on popular retail websites as soon as they are received, ideal for companies wanting to reward staff spread out across many locations.
The Grass Roots Group, world leading provider of employee and customer engagement solutions, offers the Pure Card, a prepaid MasterCard debit card with a multitude of uses. Paul Bartlett, Divisional Director for Grass Roots Employee Solutions, comments: “It is widely acknowledged that employee advocacy and engagement can be a significant contributor to overall business performance. At this time of year prepaid is becoming an increasingly popular way for companies to reward employees. Payments can be made onto cards for a wide range of incentive and reward programmes, including bonus payments, and are a powerful way of saying ‘thank you’ to employees as they do not prejudice or define how they might wish to reward themselves.”
Daniel Spier, Managing Director of IDT Financial Services Ltd, a market leading issuer of prepaid cards in Europe said:“Prepaid offers a flexible and cost-effective solution for employee incentives and rewards. As well as driving employee motivation and engagement, prepaid incentive cards are an attractive way to build brand awareness when making bonus and incentive payments.”