Amid ongoing economic uncertainty, HR may be particularly challenged this year to roll out end-of-year employee recognition strategies.

Yet, according to Shari Simpson, senior manager of thought leadership at HR and payroll provider Paylocity, there are attractive non-cash holiday bonus ideas that don’t require significant investment. And, she says, they can even be more meaningful than money when it comes to boosting engagement and strengthening company culture.

“The holiday season is the perfect time to recognize your employees for their hard work and dedication over the past year,” Simpson says. “While cash bonuses are a tried-and-true option, there are plenty of creative alternatives that can not only make your team feel appreciated but also reflect your company’s unique values and culture.”

Building a strategy for holiday bonuses

Simpson says it’s important that HR help employers establish a strong foundation for administering holiday bonuses before deciding how to recognize employees.

For starters, administering bonuses must be done smoothly and fairly.

“Navigating holiday bonuses can get tricky, especially if fairness isn’t front and center,” Simpson says, adding that employers can start by making sure their process is transparent and easy for employees to digest.

One way to do this, she explains, is to base holiday bonuses on a mix of factors, including company performance, individual contributions and employee tenure. This approach, she says, keeps criteria inclusive while giving employees clear goals to work toward.

“Communication is key,” she adds. Explain the criteria and be open about how the company makes decisions about holiday bonuses, she says. “When employees feel the process is fair, they’re more likely to appreciate the reward—and less likely to feel left out or undervalued.”

4 alternatives to cash rewards

Those feelings can be amplified when leadership thinks strategically, and outside the box, on holiday bonuses. (Simpson notes that Paylocity offers a free holiday bonus guide to help employers with this process.)

“Sure, cash is great, but if you want to make an impression that lasts, think about offering experience-based or personalized rewards,” Simpson says.

She offers a few cash alternatives employers can use in their strategies for holiday bonuses:

• Experiences, not things: Tickets to concerts, shows or sports events can create memories employees will value. Bonus points if you tailor these experiences to individual interests—like that foodie on your team who’d love a wine-tasting tour.
• Paid time off: Nothing says “we value you” quite like giving the gift of time. Offering an extra day or two off during the holidays can give employees a chance to recharge and enjoy moments with their loved ones.

• Wellness perks: From gym memberships to wellness retreats or even fitness gadgets, these rewards send a clear message: “We care about your wellbeing, in and out of the office.”

• Charity contributions: For a thoughtful twist, consider donating to a cause of the employee’s choice. According to Simpson, it’s a meaningful way to give back and align with values like social responsibility.

Centering culture in holiday bonuses

Simpson explains that it’s most imperative that rewards reflect an organization’s culture.

“Holiday bonuses are a great way to reinforce what your company stands for,” she says. “Think about what’s most important to your organization and how rewards can highlight those values.”

For instance, for remote teams, home office upgrades—like a new chair, monitor or noise-canceling headphones—can make a big difference in both productivity and comfort. And for team-focused rewards, if collaboration is a core value, consider organizing a team outing or shared experience, she says, citing, for example, a cooking class.

“These activities strengthen relationships and build camaraderie, Simpson says. “Remember, the best rewards don’t just feel good in the moment—they reinforce your company’s priorities and show employees you truly value their contributions.”

Ultimately, Simpson says, the holidays are a time for leaders to celebrate teams and reflect on their impact throughout the year.

“By combining fairness, creativity and alignment with your company’s culture, you can create a holiday bonus strategy that truly resonates,” she says. “Thoughtful rewards go a long way in showing your employees how much they mean to you—and to your organization’s success.”

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