How are employers’ approaches to Christmas celebrations changing?

Last year, organisations were still navigating Covid-19 (Coronavirus) restrictions, resulting in many moving Christmas festivities to online celebrations, downsizing to smaller groups, or rescheduling parties. For many, any in-person social events held this year will be their first since before the pandemic.

Meanwhile, the current cost-of-living crisis is affecting many people across the UK, which may cause employers to scale back seasonal in-person events or gifts and opt instead to use their budgets to provide direct financial support.

Engagement through celebratory events

A desire to celebrate employees’ hard work during the festive period, given the challenge of the last year, could mean that 2022 sees the return of Christmas workplace gatherings.

However, employers should consider what employees are likely to value the most, says Chris Ronald, vice president of Europe, Middle East and Africa B2B at Blackhawk Network. “For most organisations, providing help and support to staff throughout the whole year will take precedence over celebrating one night of the year,” he explains. “Employers will look to celebrate their employees in other ways, whether that will be celebrating the Christmas period in smaller teams or providing monetary support in place of a party.”

Coming together as a team could have more of an effect now, with many organisations trying to build upon their culture to improve employee retention, says Graham James, director at Sodexo Engage. “It’s these cornerstone celebrations during the Christmas season that can play a huge role in bringing an entire team together, whether it is to let off some steam, to bond, or to thank employees for a job well done,” he says. “Ultimately, this is integral to boosting retention, or building a better bond between employees and the wider organisation.”

Some employers will be bringing back their in-person Christmas party this year specifically to help create a connection among the workforce, as well as address diversity and inclusion.

However, some organisations are taking a broader approach, says Megan Wiseman, client success director at Reward Gateway: “We are seeing an increasing number of employers opting not to do any Christmas-related celebrations or end-of-year festivities due to inclusivity reasons, as well as others taking a cautious approach with their celebrations and ensuring they establish plans for other holidays or festive periods before they do anything for Christmas to ensure they are being as inclusive as possible.”

The impact of Covid restrictions

While there are no current Covid-19-related restrictions in place, employers may still want to be mindful of individual needs and preferences, as some are working remotely for some or all of the time, and others may have health issues that make face-to-face events a challenge.

Employees who work remotely or in a hybrid-working pattern may want to feel connected to other employees so they feel valued and part of a team. However, holding an in-person event could lead to logistical restrictions because getting everyone together is a bigger expense and challenge than previously.

Even with a remote workforce, bringing together a workforce or teams has an impact no one should underestimate, says James Malia, UK managing director at Prezzee. “It doesn’t have to be about a big party, but rather about getting teams to bond, talk to each other, laugh without being on mute, understand the organisation’s mission and drive home values that aren’t always easy to express on a screen.”

Employee gatherings could, therefore take the form of smaller parties for specific teams or departments, especially if Covid-19 cases climb in the winter months, adds Sodexo Engage’s James. “Alternatively, some organisations may continue to adopt a hybrid approach, offering virtual get-togethers and providing rewards which employees can redeem while at home,” he says. “At-home rewards will be vital for those who are unable to make the Christmas party. By offering hampers or vouchers to express gratitude for their hard work, this will ensure that they feel like valued team members wherever they are.”

However, planning such celebrations could prove a challenge. “It is impossible to predict what the Covid figures will be in December,” says Ronald. “A lot of employees are hesitant to plan these events in advance due to a level of uncertainty that burnt them last year. While we are hearing that employers see real value in recognition events, we would imagine these will look very different to a couple of years ago. Celebrations are likely to either take place in a much smaller format or be delayed until the new year.”

Recognising employees

Employers could, therefore, place more of a focus on reward and recognition with their Christmas and end-of-year plans to help foster a culture of appreciation, and make their employees feel valued through meaningful rewards.

A well-researched and personalised corporate gift recognises individual and team achievements while also making them feel appreciated, says Tracy Finn, head of corporate service at Harrods. This also helps to drive the idea that their contribution to the success of the business is recognised and respected. “We anticipate that many employers will gift in a variety of ways this season and may choose to forgo the big office celebration to use budgets for more special, personalised and sustainable gifting,” she says.

Employers may want to consider organisation-wide digital rewards and gifts to their employees that are aligned to their wider reward and recognition programmes. This also helps reduce the administrative burden on HR teams with bulk rewards and allows them to get creative with their reward and gifting programmes and align them with their recognition programmes.

Gifts and incentives

Gift cards can be a good way to show appreciation and help employees feel valued while offering them choice on where to spend it. Multi-retailer cards, for example, can be given physically and digitally, which is convenient for those working in a hybrid environment or overseas-based workers.

Ronald expects to see employers considering gifts and incentives that will help staff financially in the current climate and offer flexibility, suggesting that gift cards that can be used in supermarkets can aid the burden of the Christmas dinner costs.

Meanwhile, food and wine gifts are always popular, says Finn. “A handpicked selection of fine wines or spirits is elegant, opulent beauty gifts will always be appreciated and a beautiful book that speaks to an individual’s passions and interests is a delight,” she says.

For some, the gift focus this year is on wellbeing and experiencing life again through leisure experiences, holiday and travel.

Peter Clayton, head of corporate sales at Red Letter Days, says: “I think that most people will still be expecting a gift at Christmas to make it a special time in such hard and uncertain times to raise people’s spirits. I also think a lot of employers might be considering adding in a charity option to enable people to donate their gift to those in need. Over the past two years, many have received a gift due to office parties being cancelled. The expectation will be the same again this year and some employers may have to budget for both a gift and party.”

Some employers opt for gifts that encourage sustainability from brands that have a visible corporate social responsibility policy, while others choose to offer individual choice.

“Everyone is motivated by different things, and while for some that might be the promise of a bonus or extra annual leave days, others may find vouchers more desirable,” says James. “Alongside this, we are seeing a real demand for health and wellbeing rewards, focusing on mindfulness, de-stressing and self-help, most likely a result of the lingering effects of lockdowns and restrictions, as well as the stress of the cost-of-living crisis.”

Addressing the cost-of-living increases

To support with the cost-of-living increases, some employers may opt to give their employees vouchers for goods and services to ensure they get the full value of the award.

For example, some of Reward Gateway’s clients will be giving their Christmas party budget straight to employees instead this year, while also looking at how they can incorporate financial support into their Christmas reward programmes through the launch of creative festive campaigns and initiatives to help increase awareness and take up, says Wiseman.

However, while some employers are in the position to provide financial support during tough times, others are not able to do so. Instead, they are providing discounts to help staff reduce everyday expenses such as supermarket shops or childcare support. “Season ticket loans, [bikes-for-work] schemes, and dining out vouchers can also go a long way to keep budgets down,” says James. “With Christmas and its associated costs looming large for many, employers can also step in now and help employees get ready for the season.”

Employers may want to consider offering monthly cost-of-living support outside of employees’ normal pay, restricting it to essential retailers so it hits the heart of the purpose.

For example, offering a £100-a-month gift card towards the weekly shop can help cover the basics and be stopped if the employee leaves, says Malia. “When the tough times come to an end, businesses can decide whether it becomes a pay rise, or whether they pull it back,” he says. “Either way, the business isn’t committed to providing the support forever, which removes additional pressures on staffing overheads.”

In order to be sensitive to the variety of challenges both employees and employers will face this year, such as the cost-of-living crisis and lingering Covid-19 issues, organisations may, therefore, be inclined to send appropriate gifts or host celebratory events that acknowledge vital contributions but are not perceived as frivolous, excessive or wasteful.