This time of year, it is a big question for all employers. Where do year-end bonuses for team members fit into the business?
You may be facing a year-end cash slump or big expenses. Alternatively, you may have a bunch of cash on hand and be facing a big tax bill.
Assessing the reality of your current situation is the starting place. Many people believe they are cash-strapped when really they are not and could actually make better decisions with the resources they do have. You may want to contact us for a resource mining session to identify what you do have and how you can use your resources in the best way possible.
Regarding holiday bonuses for team members, we do not recommend it. Instead, get your team members a thoughtful gift that is within your budget based on the resources you have and the end of year tax planning you are doing. Perhaps even plan a fun retreat for the whole team, as a reward for a job well done, and pay for it this year (gaining the write-off) and host it in the following year.
When you give holiday bonuses, they become expected rather than earned. Moreover, if you do not give them one year because you really are cash-strapped, feelings can be hurt. Rather, structure your compensation plan so that your team is bonused based on measurable objectives, all year long, not just at the holidays.
We can help you structure a compensation plan that matches your revenue model and properly rewards great work, contact us when you are ready.
This article is a service of Gratia P. Schoemakers, Creative Business Lawyer®. We are a business-focused law firm with a mission of guiding your business to grow with health and creative structures. Call to schedule your LIFT Foundation Audit to identify whether your business has holes in its legal, insurance, financial or tax structures and create a plan to fill the holes.