February 13, 2024

Why Gift Cards for Employees Beat Out All Other Rewards


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You might find this shocking, but some of the best employee rewards, recognition, and appreciation gifts you can give your team members are gift cards. These convenient purchases may seem like small gifts, but in reality, they offer incredible incentives for employees of small businesses and corporations alike to continue their hard work and achieve company goals. Corporate-level gifting can even translate to better customer service for your valued customers. Why? Because a happier workforce often leads to more satisfied clients!

Whether you’re looking for a team gift, a present for special occasions like birthdays or retirement, employee appreciation gifts, or gifts for the holiday season, you can always count on employee gift cards. In this article, we’re going to examine how you and your organization can prove that you value your dedicated workers no matter the occasion. And you can do so through one of the easiest gifts you can give.

Why Gift Certificates Are The Right Gift For Staff Members

It’s difficult and overwhelming enough to figure out what to give people for holidays and other momentous occasions throughout the year. So, it makes sense why you might be scratching your head and wondering what you should buy for your talented staff. You might believe that slapping your company logo on a t-shirt is enough to show your immense gratitude. And sometimes corporate swag is great! However, gift certificates could be the most viable solution for you and your staff. Interestingly enough, 69% of workers say they would appreciate receiving a gift card from their employer. Many also would enjoy a cash award to acknowledge a job well done.

When you give gift cards, your staff members can:

  • Choose what they want to buy rather than have someone choose for them
  • Snag better deals by shopping during special sale times.
  • Enjoy more flexibility and decide when they use their pre-paid money.

Benefits of Employee Recognition and Rewards

Many brands are making the mistake of not recognizing individuals and ignoring their achievements. Gift giving is an industry best practice! Did you know that 44% of employees leave their current job because they don’t feel recognized? That’s a staggering statistic, but the good news is that it’s one that a simple rewards program can fix!

Consider the advantages of corporate gifting:

  • It creates a sense of connection and forms positive associations between an employee and a brand.
  • It boosts morale and promotes a stronger work ethic.
  • It evokes feelings of reciprocity and trust between company and employee.
  • It lets the recipient know they are valued and seen among their peers.

What Types of Gift Cards Are Good For Employees?

There are countless options for digital gift cards. You can find them for department stores, local restaurants, movie theaters, retailers, and plenty of other establishments both big and small. Today, online shopping is also at an all-time high, which proves why e-gifts like this are so popular. That being said, there are two different categories that gift cards can fall into. Keep reading below to learn more about these distinctions: open loop and closed loop.

Open Loop Gift Cards

Open loop cards are used to purchase general merchandise. You can use an open-loop gift card anywhere Visa debit cards are accepted. These can include Visa gift cards and Visa Virtual Gift Card as well as Mastercard Brand Mark cards and other prepaid Mastercard gifts. They are usually issued by a bank that has a relationship with the card network. The tremendous benefit of these types of cards is that they are extremely versatile, allowing the user to purchase whatever they so choose.

Closed Loop Gift Cards

Closed-loop cards, on the other hand, can only be redeemed to purchase products at a particular store as designated on the card itself. Starbucks, Target, and Outback Steakhouse cards are a few examples. They are generally free to activate and are the perfect way to give someone a more personal gift if they happen to like to shop at a certain place.

Are Gift Cards Taxable?

Yes, these items are considered taxable income, which can affect your income tax when tax season comes around. According to the Internal Revenue Service or the IRS, all cash, gift certificates, and cards are deemed taxable fringe benefits. This means that if you give out gift cards to your team, you need to report them as earnings.

Some additional terms to consider include the fact that this special rule has its exceptions. If what you’ve given are holiday gifts of property, or a specific item of personal property with a low fair market value (sometimes this is valued under $50-100), you can choose to use a fringe benefit called the De Minimis Fringe Benefit. One example of a fringe benefit is social security, as it’s subject to federal taxes. The De Minimis benefit allows you to exclude the amount from a team member’s pay because it’s such a small amount and it would be impractical to record. Cash, however, is not part of the exclusions that you can make with this benefit. It also depends on the frequency you hand out rewards. If you give more frequently and in bulk, the amount may add up over time and you may need to account for that money in the end.

As always, it’s important to abide by the IRS’s rules and requirements. The best thing you can do as an employer is to have your accountant track every single penny that comes through or out of your office. Have multiple steps in place to ensure your tax form is 100% accurate.

Note: Also make sure to follow your company’s Privacy Policy when it comes to giving out rewards. Be sure that you don’t make the gift overly personal, as this can cross lines between company and employee.

The Top 10 Best E-Gift Cards To Give For Awards

Here is a list of fun e-gift ideas that you can send to your team within minutes through their email and that still offer a personal touch:

1. Doordash

Food delivery has become one of the most popular ways people get their meals. It’s fast, convenient, and gives them instant access to all their favorite local restaurants for breakfast, lunch, or dinner. Doordash is perfect for remote workers, foodies, or those who are limiting public interaction due to COVID-19.

2. Visa

Visa gift cards are some of the best items you can give because it offers the individual a chance to decide where they want to shop. Your team is guaranteed to appreciate the thoughtful gesture as well as its accompanying versatility. You probably won’t overhear any complaints with this one.

3. Amazon

Everyone loves extra money to use on Amazon. In the past few years, it’s become one of the most popular places to shop in the world. Why? Because you can get pretty much anything your heart desires there! And the best part is, if you’re a Prime Member, you get free shipping on all Prime products too! It’s a win-win.

4. Uber

If you live in a bigger city, this idea is for you. Chances are, your team has to use an Uber a few times a month. Maybe they’re traveling frequently or maybe they just like ride-sharing apps better than other public transportation like a taxi, subway, bus, or tram.

5. Airbnb

Many companies don’t want their workers to take a break, which is an attitude that often backfires through burnout. But who wouldn’t want some of their next vacation paid off? With an Airbnb gift card, you can encourage some rest and relaxation and earn some extra points with your staff.

6. Lowe’s

The homeowners in your office will love a Lowe’s gift card, especially when something in their house suddenly breaks. Thanks to you, they won’t have to break their bank paying for the repair tools.

7. Walmart

Similar to Amazon, Walmart is a place of endless possibilities. From groceries and sporting goods to clothing and household items, you can buy anything you like. And typically, you can find it for an inexpensive price.

8. Panera Bread

Bagels, soup, sandwiches, oh my! Some of the best gifts involve food, and Panera is always a premium choice when lunchtime rolls around. It’s a great way to say thanks when you’re buying bulk gifts and have a limited budget.

9. Starbucks

Coffee lovers will thank you endlessly for fueling their caffeine addiction and helping them make it through their workweek. It’s likely that you’ll see immediate benefits too, as they’ll be energized and ready to take on every task you throw at them.

10. Best Buy

Best Buy is home to various TVs, laptops, headphones, and countless other must-have tech accessories. When your employee needs to buy a new printer or laptop case, they won’t have to pay full price! We promise they’ll remember that.

Send Your Next E-Gift With Sendoso

Sendoso is a leading sending platform that specializes in gift-sending services. With Sendoso eGifts vendors, we make it easy for recipients to receive everything from groceries, lunch, coffee, dessert, and oh-so much more! You order what you want, pay the cost, and we’ll ship the mail order right to the recipient of your choice. Our process is straightforward and hassle-free, allowing you the chance to wow your workers and let them know you care. No matter if you’re interested in team building, showing appreciation, or simply boosting office morale, we’re sure you’ll find the perfect present in our inventory here at Sendoso! The results will be spectacular as you look back on how your corporate gifting made you the best represented company in your team’s eyes!

Do you have more questions about how you can engage with your team, especially with more and more people working from home? We have just the thing to get your remote workforce revved up. Download our eBook on 35 Meaningful Ways to Engage Your Remote Workforce – A Strategic Guide for Human Resources: https://sendoso.com/resources/ebooks/hr-sending-guide/

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