Holiday Bonus Becoming Rare, Survey Finds

CHICAGO — If all you want for Christmas is your company bonus, make another wish. A new study finds that the holiday practice is fading faster than the red on your Santa Claus socks.

In a nationwide survey by Hewitt Associates of 268 companies, 12% said they had dropped the bonuses recently. Nearly two-thirds don’t give employees so much as a lump of coal for their stockings, according to findings released Wednesday.

The reason many cited: It’s not smart business, providing little incentive for employees to do better work.

“Companies want to get away from giving something for nothing, even at Christmas,” said Frank Belmonte, compensation consultant for the Lincolnwood, Ill.-based management consulting firm.

With the U.S. economy aglow like the White House Christmas tree, it might seem an odd time for companies to play Scrooge.

But hold those humbug thoughts. Companies are shelling out more bonuses overall than ever, according to Hewitt--they just give them out at different times, linked to performance rather than the calendar.

Take Kryptonite Corp. Three years ago, when its top management changed, the Canton, Mass.-based lock manufacturer decided to scrap its holiday bonus--a week’s pay--and tie any bonuses to the company’s bottom line.

Now the firm throws a party every February and hands each employee a check based on a formula linked to the previous year’s profit. This year’s check was for $2,100.

A majority of companies surveyed--52%--have never had a holiday season bonus.

In Hewitt’s survey, 36% of the companies still provide a bonus or gift to employees during the December holiday season. Of those, 37% give the bonus in cash, 29% give food and 24% give a gift certificate to a local retailer.

And the total amount of those bonuses is increasing, at least on Wall Street, where a record $13 billion is being given out this year, up 18% from last year, according to the Securities Industry Assn.