In a year defined by an ongoing pandemic that is weighing on employees, and a hot job market that makes it easier for workers to leave their jobs, some employers are taking the holiday spirit further than in years past.
Bonuses, extra paid time off and holiday gifts are all on the table this year as employers look to reward employees for another arduous year dealing with COVID-related stresses and working long hours.
“After another taxing year, we are hearing that employers are looking for ways to reward employees,” says Julie Stich, vice president of content for the International Foundation of Employee Benefit Plans, a nonpartisan group that counts more than 8,200 organizations and 32,000 individuals as members.
Year-end bonuses are twice as common this year, according to data from job placement firm Challenger, Gray and Christmas. Tyson Foods, Google and trucking firm J.B. Hunt are among the employers handing out holiday bonuses to employees this year to thank workers for efforts during another difficult year.
Almost a quarter of all companies (23%) say they are offering a bonus based on company performance, up from last year’s 12%, according to Challenger, Gray and Christmas. That’s the highest percentage since the firm began tracking performance bonuses in 2015. Another 20% of organizations say they are awarding a nominal–$100 or less–monetary award to all employees, like cash or a gift certificate.
Bonuses are coming at a pivotal time for many workers as rising inflation rates are hitting employees hard. The annual rate of inflation in the United States hit 6.8% in November, the highest in more than three decades, as measured by the Consumer Price Index.
Data from Challenger, Gray and Christmas also finds that 15% of employers say they are providing a non-monetary gift to all employees, such as gift baskets or an extra vacation day.
Extra paid time off during the holiday season is an especially valued benefit, IFEBP’s Stich says, especially with many employees not taking the time off they usually do during the pandemic. Research shows that fewer employees have used their PTO this year because of COVID-19 cautions and restrictions that are prohibiting how they would like to use the time off. As a result, many employees are working longer hours with little time off and burnout is on the rise.
Lego, for instance, awarded all of its 20,000 employees across the world three extra days of holiday time–in addition to bonuses–and the city of Palo Alto, California, is giving all city workers three extra paid days off. Other employers are closing down offices between Christmas and New Year’s, Stich says.
“Employers are offering more flexibility, and offering additional time off is an immediate benefit that is highly valued,” she explains. “We have been hearing anecdotes of employers taking a day to close the shop and give their employees an extra day off to take a break.”
The practice varies by industry, as not all organizations are in a position to do that, Stich says–but the holidays are a natural time to do so as employers look for predictable slow points in their business cycles and offer up those days as extra time off for their workforce.
While end-of-year perks make sense for the holiday season, that spirit will likely continue into the new year and beyond, experts predict. With the Great Resignation in full swing, and with burnout and other stresses soaring, smart employers will continue to do more to keep employees–from compensation changes and benefit enhancements to offering more flexibility.
“As employers seek to attract and retain talent in a tight market, they are getting creative with their perks,” says Danielle Capilla, vice president of compliance, employee benefits, at Alera Group, a Deerfield, Illinois-based insurance and wealth management firm. “I am seeing employers offer extended PTO, offering health benefit premium holidays, and even offering subscriptions to meditation applications or home fitness applications.”