A just reward

Heather Wiseman
Med J Aust
Published online: 10 December 2012

With Christmas approaching, it’s a good time to think about rewarding your practice staff for their hard work during the year. What is the most effective way to reward them?

It’s hard to reconcile that a Christmas bonus might inspire staff to resign. Yet that’s the unexpected fallout some medical practices have experienced, according to Carolyn Ingram, national president of the Australian Association of Practice Managers.

Ms Ingram says that while it is important for practices to thank and acknowledge their staff at Christmas, the “emotionally charged end-of-year bonus” can be fraught.

“If you start handing out money, some employees will get cagey and wonder, ‘Is everyone getting the same amount?’ ”, she says, adding that it’s a time of year when people tend to be tired, stressed and ready for a holiday.

“They’ll ask ‘What did you do that I didn’t do?’. All those things can really complicate a business. Christmas is stressful enough without adding that potential bonus problem.”

A more sensible, though less joyous, approach is to ensure any bonus is tied to key performance indicators, which are set and reviewed quarterly. “If you want to do an end-of-year bonus, do it at the end of financial year and never do bonuses without a reason.”

Christmas, then, is a time for handwritten cards offering heartfelt thanks, gifts or vouchers, and maybe even a party.

What rewards work best

The most effective reward costs nothing more than a little thought and time, according to Ms Ingram, who says busy employers need to remember to say thank you — often, not just at the end of the year.

“The verbal reward works really well — amazingly well”, she says, particularly when it comes from someone senior and busy. “If they just take that one second to say thank you at the end of the day, it makes a huge difference.”

Ms Ingram says staff morale soars when someone senior notices that the phones have been running hot or that staff have coped well under pressure, and offers thanks for keeping on top of the workload.

“By doing that you are building your staff’s self-esteem and they are more likely to contribute positively if they are feeling good about what they’re doing”, she says, adding that it needs to be done within 24 hours.

National president and chairman of the Australian Human Resources Institute, Peter Wilson, says a sincere note of thanks is a more motivating reward at Christmas than a financial incentive. He says ideally employees should each receive a handwritten card that expresses gratitude for something specific they have contributed during the year.

Staff are likely to appreciate a gift along with their card, but this too can create issues. Mr Wilson and Ms Ingram both recommend keeping gifts for all staff the same.

Mr Wilson suggests Gold Class cinema tickets, cash bonuses of $100–$200, gift cards and bottles of wine or Christmas hampers. Ms Ingram has pulled together baskets of luxury treats that employees would enjoy but would be unlikely to buy for themselves.

She says giving staff the opportunity to relax and enjoy a meal together is also good for morale at Christmas, but that doesn’t necessarily mean lavish meals or big parties.

“We take our staff out to dinner, but that’s not possible in all practices”, Ms Ingram says. Even closing a busy practice for 2 hours at lunchtime and having something low-key on the premises can help to make people feel appreciated and valued at Christmas.

What is tax deductible?

When Paul Keating was Treasurer more than 20 years ago, he abolished the tax deductible lunch, according to financial adviser and solicitor, Terry McMaster, who says that while it stopped a lot of rorts, it also complicated the work Christmas party. Combined with fringe benefits tax rules and exceptions for events like seminars, “the inevitable result was a mishmash of rules and exceptions to rules, such that a medical practice needs a full-time in-house tax adviser to make sense of them”.

Whether the cost of a Christmas party is exempt from fringe benefits tax or partly income tax-deductible is determined by criteria including: whether it is held at your business premises or elsewhere; whether employees, their associates or clients attend; and the amount per head that is spent on meals, drinks and entertainment. It’s best to check your plans for a party with your accountant to be sure of the tax situation.

In terms of gifts, Mr McMaster says any monetary reward given to employees is taxed as salary and attracts superannuation, WorkCover and potentially payroll tax. Gifts, including shopping vouchers, are subject to fringe benefits tax if they’re more than $300. The good news is that “if an employer gives each employee a Christmas gift worth, say, $299, there will be no tax charge”, he says.

Thinking outside the box

While vouchers and bottles of wine are safe, they’re also a little predictable. Your employees might appreciate you thinking outside the square, so consider:

Something karmic: Encourage philanthropy and get back to the real spirit of Christmas by giving your staff a charity gift voucher from Karma Currency ( The idea is that staff visit the not-for-profit organisation’s website and scroll through the hundreds of charities and projects they can donate their voucher to. Whether they contribute to saving a rainforest, educating a child or cancer research, they will enjoy deciding on a worthwhile cause to support.

Something practical: Busy staff might enjoy the services of a cleaner, someone to wash or iron their clothes, or having home-cooked meals delivered. Explore what reputable local businesses would be prepared to establish a unique voucher system so you can relieve domestic tedium, even just for a short while.

Something fun: Have cups printed with each staff member’s name and something fabulous about them.

Something physical: Announce in your Christmas cards that staff will receive regular professional massages throughout the year. Organise for a masseuse to visit the office to give staff tension-relieving head, shoulder or foot massages to improve their sense of wellbeing and productivity.

Something wrapped: Make your gift vouchers more fun by finding a popular local department store that operates a gift registry. Contribute the same amount to each staff gift, but ensure staff can top this up to purchase a gift of their choice. Have the gifts wrapped and delivered to the Christmas party, so staff can enjoy the simple pleasure of opening a gift and admiring one another’s presents.

Something peaceful: Not all employees enjoy attending a work Christmas party, particularly if it intrudes on time with their family. If a party might bring more stress than good cheer, give staff an unexpected surprise; time off work instead. Whether it’s a half day, or a full day, it’s bound to be appreciated at such a busy time of year.

The practice that likes to party

Staff at Bluff Road Medical Centre in Melbourne know how to party. One Christmas they had a Logies theme, where staff glammed up and worked the red carpet, posing to have their photos taken before accepting rounds of applause and awards made of silver cardboard. Another year they had a rock star party that went down in history; the associates turned up as the band KISS, complete with full make-up. They had just as much fun the year that Santa arrived on the back of a ute and staff had water pistol fights on a pier.

Practice manager, Malcolm Brand, says most of the 39 people who work at the general practice in Sandringham look forward to the staff Christmas party and make an effort to go.

“Most of the staff really like to let loose”, he says. “We walk around in uniforms for the whole of the year, so it’s an opportunity to show ourselves as we may not normally be seen. Some of the young students rage on a bit and encourage the oldies and it all works pretty well.”

At this year’s Christmas party, the staff — who range in age from 21 to nearly 70 years — will dance the night away. The dress code is dancing attire (“disco, flamenco, ballroom, rap, belly — whatever takes your fancy”) and the theme is “dancing with the stars”.

Mr Brand says every year someone dresses as Santa and staff sit on his knee and say whether they’ve been good or bad. “I have been Santa’s helper”, he says. “I had to wear an elf suit that someone had in their cupboard, which was completely ridiculous.”

Typically, one of the practice’s six associate owners gives a speech, where they thank staff, recognise their achievements, and highlight “all the weird things” that have happened during the year. There’s also a Kris Kringle present exchange. “It’s all done in good humour”, Mr Brand says. “One year somebody gave me a wine transfusion kit, where you had to drink the wine from transfusion apparatus.”

Mr Brand says there was a time when the associates tried to personalise gifts, and buy something different and appropriate for each member of staff. But this became too difficult as staff numbers grew, and there were concerns about all gifts not being equal. Instead, staff now receive a gift voucher, which comes in a card with a personalised message written from an associate.

Between the gift vouchers and the party, the practice spends $8000–$9000 on generating Christmas cheer. “I think we’re very lucky that our owners wish to reward their staff”, Mr Brand says. “We’re very privileged”.

  • Heather Wiseman



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