A gift is the perfect way to show your employees that you notice them, care about them, and value their contributions to the company. And employees who receive meaningful gifts are more motivated and productive, and they enjoy a higher morale at work as well. This proves the old adage, when you put good in, you get good out.
Dive into this gifting guide to learn more about gifts, why they’re important, and how you can implement the best gift-giving practices at your organization.
Why Do We Give Gifts?
Gifts have been a part of human culture for generations, dating back almost to the beginning of humanity itself. The act of giving gifts has become an important part of our social traditions, and it’s even developed into a common love language.
The History of Gift Giving
Why do we give gifts? Why is this social exchange hardwired into our very nature, and why do we use gifts as a way to show love, appreciation, or thanks? Primitive cultures used gifts to attract or woo members of the opposite sex and also to show appreciation for heroic deeds.
The tradition of birthday gifts was actually started in Ancient Egypt. A new pharaoh’s coronation was considered their “birth day” because it was the first day of their new life as a god. Of course, pharaohs were given all sorts of gifts to commemorate this special birthday, and the tradition has stuck!
Ancient Greece and Rome started gift-giving traditions as well. Greeks were known to give gifts to travelers in case they were actually gods in disguise, and Romans gave gifts to the emperor during the festival of Saturnalia.
During the middle ages, we see the rise of romantic gifts between men and women, with gifts ranging from personalized songs to a lock of your hair sewn into clothing (don’t try that one with employees, please).
Nowadays, every culture on the earth has different traditions of gift giving. Whether it’s cash in a red envelope during Chinese New Year, sweets during India’s Diwali festival, or gifts for every person at a birthday party in Russia, humans love giving and receiving gifts.
The Psychology Behind Gift Giving
There are a few reasons gifts are universally fundamental to humans all over the world. Some of these psychological reasons may not even register in our minds as we gift things, but they’ve all done their part in cementing the gift-giving tradition into our cultures:
- Start, build, or reinforce relationships. We give gifts to those we care about in order to build our relationship with them. Whether that’s a romantic gift to a significant other or a birthday gift to a sibling, we want to show them we care and we want confirmation that they care.
- Show appreciation. Underlying every aspect of gift giving is appreciation. Humans give gifts to show others that we value them and the role they play in our lives.
- Offer symbolic communication. Everyone has heard that “it’s the thought that counts,” right? That has a deeper psychological meaning. When you get a personalized gift that is perfect for you, the giver shows that they think about you and care about you (this is a big one for employee gifts!). Gifts that are obligation-inspired feel fake, impersonal, or uncaring, which communicates a whole lot.
As for brain chemistry, giving the right gift releases oxytocin, serotonin, and dopamine. These three hormones help you feel warm, fuzzy, happy, and euphoric, and they instinctively make you want to give more gifts.
Why Worry About Gifts for Employees?
You may wonder where employee gifts fit into all of this talk of love and relationships. Well, employees, like anyone, need to feel appreciated and valued. They are humans and crave connections, and yes, that includes in the workplace.
Now think about the last few gifts you’ve given employees; how many branded t-shirts, coffee mugs, and cheap notebooks do your employees own? What messages do those types of gifts say about the company's relationship with its employees? What symbolic communication do those types of gifts convey?
Most employees understand that it’s hard to get extremely expensive or personalized gifts for hundreds if not thousands of employees. However, 42% of employees say they received a gift from their employer that they didn’t want, and 56% of employees say gifts they’ve received feel impersonal and generic. So there is room for improvement when it comes to employee gifts and appreciation. AND you may see some concrete benefits when you put in a little extra effort.
Benefits of Employee Gifts
1. Helps employees feel valued
2. Boosts morale
3. Increases loyalty
4. Helps employees find satisfaction in their jobs
5. Increase engagement
Benefits of Good Employee Gifts
Businesses are in the business of making money. Giving gifts can seem counterintuitive to that goal, and we understand that that can make gift giving difficult and stressful. But take a look at some of the benefits of good employee gifts and how these benefits can impact your business:
- Gifts make employees feel noticed and valued, which boosts morale.
- Gifts forge connections between the employee and the organization, which increases loyalty.
- Gifts can help employees find more satisfaction in their job, which increases engagement.
Think about that. With a little more thought in the gifts you give your employees, your workforce will be happier, more loyal, and more engaged in the company. Gifts are really just a way to recognize your employees, and recognition reduces turnover by 31% and lowers frustration levels by 28.6%. Plus, over 80% of employees agree that recognition improves their work experience, happiness, engagement, and relationships.
With an engaged and happy workforce—with employees who feel noticed, valued, and appreciated—your business will enjoy a culture of recognition, rewards, and loyalty.
Employee Gifting Best Practices:
We’ve gone over the “why” of employee appreciation gifts, but that’s only part of the problem. Now we want to go over the “when” and the “how” so that you can confidently provide gifts that are sure to be a hit.
When Is the Best Time for Employee Gifts?
2. Employee Appreciation Day
3. World Health Day
4. International Friendship Day
5. Labor Day
7. Thanks Giving
8. Boxing Day
9. New Years
12. Work Anniversary
The Nitty-Gritty Details of Employee Gifts
Recognition is always a good thing, no matter what time of year, month, week, or day. But we’re talking about gifts here. When is the best time to buy a gift to give to your employee? (Pro tip: Awardco lets you recognize every day of the year AND provide points that employees can use to buy a gift they actually love. Just sayin’.) Here are a few holidays and celebrations that you can consider.
Valentine’s Day - February 14th
While this holiday is traditionally a romantic one, it’s also a great time to show how much you value your relationship with your employees. Small gifts of chocolates, flowers, or gift cards to spas or salons are good ways to pamper your employees while showing them you care.
Employee Appreciation Day - First Friday in March
Every year, you have an opportunity to appreciate your employees without holding back. The first Friday in March is employee appreciation day, and this is the perfect time for you to provide meaningful gifts to your workforce.
World Health Day - April 7th
Physical and mental wellness are becoming more and more of a focus for employees. Why not show them that you care about their wellbeing with a nice health-related gift? Workout equipment, ergonomic office equipment, or even an all-expense-paid dinner at a fancy (and healthy) restaurant are great ways to show your appreciation.
For a more specific holiday, National Employee Health and Fitness Day is the third Wednesday of May. Take your pick and celebrate the health of your employees!
International Friendship Day - July 30th
Friends make work so much better, and hopefully your office culture cultivates and strengthens bonds of friendship. To improve that, why not give employees gifts to show that you value their friendship and their dedication?
Labor Day - September 3rd
This holiday is all about celebrating the importance of laborers in our world—in other words, celebrating employees! Instead of just one day off, you could give the gift of an extra day of PTO to make this holiday even more special.
Standard Holidays - October Through December
Whether you want to give gifts at Halloween, Thanksgiving, Christmas, Boxing Day, Hanukkah, New Years, or Kwanzaa, the holiday season is arguably the best time to give meaningful gifts to your employees. Spread the joy of the season with thoughtful, personalized gifts that show how much you care about each person individually.
Service Awards and Birthdays
Besides holidays, you should always provide a gift for employee birthdays and work anniversaries. These celebrations, even more than regular holidays, allow you to personalize the gift to each employee. Find out what each person needs, likes, and is interested in, and give them a gift that really hits the right spot.
How Do You Give Employees Gifts Effectively?
This may not be a question you’ve considered before, but many managers, executives, and HR leaders may not know what the best way to give employee gifts is. Do you leave a wrapped box on each person’s desk? Provide a bunch of prizes in a raffle at a company party? Bring everyone up to the front of a meeting to present the gift? You have a lot of options.
The main thing to keep in mind is that employees want gifts that mean something to them, and that includes the way they get it. Is an impersonal bag on a desk going to send the right message? Is embarrassing a shy employee in front of the company going to leave a sour taste in their mouth?
Make the actual gift giving as personal as you can. Include a hand-written card explaining what each employee means to the company. Have managers deliver the gifts to their direct reports personally. And always (ALWAYS) make the gift itself something the employee wants.
How to Give Remote Employees Gifts?
The popularity of remote work makes this consideration a necessity. If you have workers who don’t come into the office, how do you provide them with gifts that will help them feel valued and seen? After all, remote workers are 182% less engaged than in-person workers, and this primarily comes from the feeling of not fitting in.
Here are some ideas for gift giving that will show your remote employees that you care about them, that they’re part of a team, and that they matter:
- Send them packages. Whether you order something off of Amazon and send it to them or create a custom Bonus Box from Awardco filled with their favorite things, these surprise packages are great ways to show remote employees your appreciation.
- Provide them with an experience. Working from home can blur the line between relaxation time and work time. Show remote employees that you understand this struggle by gifting them tickets to an event, a gift card to their favorite restaurant, a movie bundle with tickets and snacks, or paid-for classes.
If your workforce all lives in the same general area, have managers or executives deliver gifts to remote employees’ homes. This face-to-face interaction will go the extra mile in making the gift special.
How Do Taxes Affect Employee Gifts?
Taxes are a big part of employee gifts, and there’s no getting around that. We don’t pretend to be tax experts on the level of H&R Block or TurboTax (the document the IRS uses for employee gifts and compensation is around 4,000 words long—ain’t nobody got time for that!), but we do know a thing or two about employee gifting. Here are four things you should remember:
- Any employee gift that is cash, gift cards, or points redeemable for merchandise is considered taxable income, with no exceptions.
- Non-cash gifts under $75 in value are considered non-taxable.
- De minimis fringe benefits are gifts or compensation that are small and insignificant enough that accounting them is unnecessary. Holiday gifts (under $75), occasional meals, or occasional tickets to events are good examples of this.
- Length-of-service awards and other employee achievement awards CAN be non-taxable, but only if they meet certain criteria (such as an award for over five years of service and a value of less than $1,600 per year per employee).
Tax laws can be confusing, so we recommend reading the three sources linked above and talking with a tax expert to get more details.
Employee Gift Ideas
And now, the moment you’ve all been waiting for. You know why gifts are important, and you know when and how to give gifts—now let’s talk about some good gift ideas and what your budget should look like. After this, you should be ready and equipped to handle any employee gift opportunity that comes your way.
Employee Gift Ideas for Different Price Ranges
Not every single celebration holds the same importance. A gift for International Friendship Day probably shouldn’t be as nice as a Christmas or birthday gift (or it can be; who are we to judge?). Either way, it’s not a bad idea to consider different gifts at different prices so that you can get employee gifts for all occasions without breaking your budget.
We’re going to preface this section with a little self-promotion: with Awardco, you don’t need to find specific gifts. Instead, you can reward points in any amount you choose to your employees and let them choose what they want!
Small Gifts for Employees:
Yes, certain events may call for a small, inexpensive token of your appreciation. Remember, it’s more about the thought put behind the gift, not the gift itself. Here are some gift ideas under $25:
Employee Gift Ideas Under $25
The point we’re trying to make here is that you have a lot of options, even if you don’t have a big budget for gifts. Don’t settle for cookie-cutter ceramic mugs again—choose fun gifts and make sure everyone gets something they’ll appreciate.
Medium Gifts for Employees:
This is where you have too many options to really count. With around $100 per employee, you have the opportunity to find gifts that will mean something for each of your employees. Some of our favorite ideas are below:
Employee Gift Ideas Between $25-100
Large Gifts for Employees:
These are the gifts reserved for big events and celebrations. Has one of your top employees just hit their 10-year service anniversary at the company? Don’t settle for an acrylic trophy that they probably won’t care about. Think about high-quality gifts that mirror the dedication and effort the employee has shown over a decade. Here are some of our favorite big gifts (we’re leaving the price off these ones because they vary so much):
Employee Gift Ideas $100 and Up
- Tickets for a cruise or vacation
- A gift box full of personalized items
- Dinner at a high-class restaurant
- Office equipment (such as a new chair or desk)
- Electronic equipment (such as a new computer or TV)
- Personal electronics (such as headphones or a smartphone)
- Kitchen equipment (such as an appliance or a stand mixer)
- Clothing and accessories (such as a new jacket, shoes, or sunglasses)
Broken record time: get employees gifts that they’ll actually appreciate. 84% of employees say they’ve received gifts that they didn’t want from their company, and those types of gifts are more harmful to your culture than helpful. On the flip side, 77% of employees said they’d rather choose their gift than have their bosses choose for them. Whether that means giving them points through Awardco or presenting a few curated options, your employees will love that you care enough to give them a say in their gifts.
Remember, not every event is worth the same type of gift. A 10-year service award should be a once-in-a-lifetime type gift, while a birthday gift should probably be a little less grand. But as long as you show that you care, employees won’t care about the price tag.
Your Employee Gift Budget
As with most things in business, the answer to this is—you guessed it—it depends. How much of your budget have you allocated to employee recognition and rewards? 1% of payroll? More? SHRM recommends at least 1%. But do you want to tie gifts in with that budget? These are decisions each company will have to make for itself based on its income, employee count, and goals.
However, we have some general gifting budget advice that we hope will be helpful for companies of any size. First, general knowledge seems to agree that employers on average spend anywhere from $10 to $100 per employee per occasion. Where you fall on that range depends on the occasion. For example, 73% of employers spent anywhere between $50 and $75 per employee for Christmas gifts in 2017.
These are general numbers that can give you some ideas for your gifting budget.
Gifting Made Easy
Employees give a lot to the places they work. They work through marriages, birthdays, holidays, and more, and they deserve meaningful gifts for their efforts. And when companies show that they care with quality gifts, you build a symbiotic relationship where everyone feels valued, cared for, and loyal.
Awardco is all about helping employees feel valued and recognized. With our automated platform and our access to the largest reward network on the planet, gifts can be as simple and effective as possible.