Of the 67%, 51% never had a holiday bonus program and 16% had a program that has been discontinued.
When asked the reasons for discontinuation, 59% reported cost, 34% entitlement issues and 24% said development of pay-for-performance plans.
Hewitt also found holiday bonus programs were discontinued during the following periods:
- Before 1980 – 7%
- In the 1980’s – 9%
- In the 1990’s – 47%
- Between 2000 and 2002 – 37%
The companies that never had a holiday bonus plan report the major issues to implementing one were cost (47%), never considering such a program (40%), and inconsistency with the current reward policy (38%).
The 33% of companies that offer holiday bonuses do so with cash (39%), gift certificates (36%) and gifts of food (28%). The cost per employee for these holiday bonuses averages $200 for cash bonus, $25 for gift certificates, and $20 for food gifts. Some companies offered a combination of holiday bonuses.
Sixty-two percent of companies with holiday bonus budget less than 1% of payroll expenses and 19% of companies target between 1% and 2% of payroll expenses.
The study also found that 64% of the 432 companies surveyed would host a holiday party this year.
Hewitt says this year’s numbers are consistent with previous results. Since 1999, the number of companies not offering a holiday bonus has ranged from 64% to 69%.