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Avoid common mistakes when giving employee gift cards. Learn best practices and discover Assembly’s new gifting program.
Gift cards have become a staple in employee recognition programs, offering flexibility, convenience, and a personal touch that traditional rewards often lack. But while gift cards can be a powerful tool for boosting morale and showing appreciation, there are several pitfalls organizations frequently encounter. Missteps can lead to compliance issues, diminished impact, or even negative employee experiences.
In this article, we’ll explore the most common mistakes companies make when giving gift cards to employees—and how to avoid them. Plus, we’ll introduce Assembly’s new, free-to-signup gift card program, designed to make employee gifting simple and straightforward.
Gift cards are popular for a reason: they’re easy to distribute, let employees choose what they want, and can be tailored to fit any occasion—from birthdays and anniversaries to thank-yous and retirements. However, the simplicity of gift cards can be deceptive. Without careful planning, your well-intentioned gesture could backfire.
One of the most overlooked aspects of employee gift cards is taxation. In most countries, including the U.S., gift cards are considered taxable income and must be reported on employees’ tax documents. Failing to report them properly can lead to compliance headaches for both the company and the employee. Always consult with your payroll or HR department to ensure you’re following the law, and communicate any tax implications to your team.
A generic gift card can feel impersonal, especially if it’s for a store or service the recipient doesn’t use. Personalization is key. Consider surveying employees about their preferences or offering a selection of gift cards. Assembly’s platform, for example, allows you to send money that can be used across a wide catalog or for specific curated rewards, ensuring your gift is meaningful.
Gift card programs should align with your company’s recognition policies and budget. Inconsistent or ad-hoc gifting can lead to perceptions of favoritism or unfairness. Establish clear guidelines for when and how gift cards are given, and stick to them.
Some gift cards come with hidden fees, short expiration dates, or limited usability. These restrictions can frustrate employees and diminish the value of your gift. Opt for cards that are widely accepted, have no fees, and offer digital delivery options. Assembly’s catalog includes a variety of flexible options, from e-cards to curated rewards.
A gift card should never arrive out of the blue with no explanation. Always include a personal note or message explaining the reason for the gift. Assembly’s e-card feature lets you create a kudo board or use customizable templates, making it easy to add a heartfelt message and even let others sign the card.
Be mindful of your employees’ diverse backgrounds and preferences. Some gift cards may not be appropriate for all cultures or lifestyles. Offering a range of options or letting employees choose their reward can help avoid unintentional offense.
Ensure that the value of gift cards is consistent and based on transparent criteria. Disparities can lead to resentment or perceptions of unfairness. Automated gifting solutions, like those offered by Assembly, can help standardize the process and ensure equity.
Tracking who received what, when, and for what reason is essential for both compliance and program effectiveness. Assembly’s platform provides robust tracking and reporting features, so you never lose sight of your recognition efforts.
Assembly’s will soon launch its new gift card program that is designed to make employee gifting easy to personalize. Here’s what you get:
Assembly’s platform takes the guesswork out of employee gifting, ensuring every recognition moment is meaningful, memorable, and easy to manage.
Don’t let common mistakes undermine your employee recognition efforts. Schedule a demo with Assembly today and discover how our new gift card program can help you create moments of delight, ensure compliance, and make every employee feel valued.
Yes, in most cases, gift cards given to employees are considered taxable income and must be reported on their W-2. Always consult your payroll or HR department for compliance.
Personalize the gift, ensure tax compliance, choose flexible and widely accepted cards, communicate the reason for the gift, and track all distributions.
Use platforms like Assembly to personalize messages, offer a choice of rewards, and create group e-cards or kudo boards for special occasions.
Avoid ignoring tax rules, giving impersonal or restrictive cards, inconsistent gifting, and failing to communicate the reason for the gift.
Get the foundational knowledge on creating an employee recognition program that boosts employee engagement and helps them feel valued.
Explore Guide
Yes, at Assembly, security is a top priority. Each quarter, we have ongoing security work that is everyone’s responsibility. While we maintain a strong security posture, it was important for us to prove to our customers that we do everything we claim to do. This led us to pursue a SOC 2 Type II report that would provide evidence of our compliance with industry gold-standard security practice.
There is study after study showing that employee recognition leads to increased engagement. This in return creates an environment where employees are happier and more motivated which increase productivity and reduces voluntary turnover significantly. In order to filled critical roles, companies tend to spend nearly twice the value of an annual salary. Assembly is an investment in your employees that supports your bottom line.
Yes, we will offer contracts for companies with longer-term agreements to help larger customers have more certainty around future costs.
The minimum agreement term is a 12-month subscription.
We do and for FREE! Any new customer needing further support to get started with Assembly to ensure you're set up for success can request custom onboarding support. Improving your employee experience is about much more than just using our amazing software; it’s about transforming your business to create a workplace that people love. That’s much easier to do with the personal support and advice from our passionate people experts.
At the time of redemption (when your employees exchange their points for a paid reward) you'll pay face value. If a reward is a $10 Amazon gift card, your cost will be $10. All paid rewards are billed for on a monthly basis.
The good news is that you don't have to pay for rewards upfront because we only charge you when points are redeemed, not when they're earned.
We offer discounts or educational or charitable organizations. In order to secure a discount, you'll first need to book a demo with a customer support specialist.
For all other organizations, we are willing to consider longer-term agreements in exchange for discounts. To set up annual plans or longer, you will need to book a demo with a customer support specialist.
If you're on a month to month plan, you can go here and cancel anytime. If you're having concerns or need help setting up your account for success, you can always book a demo with a customer support specialist.
If you're on a longer-term custom plan, you'll need to reach out to your customer support specialist to cancel your account or email us at support@joinassembly.com.
Great question! You can customize your core values to match your organization's to boost and track alignment. You can change your currency from the 🏆 emoji (our default) to any emoji of your choice. You can swap our logo for your own. You can also set up company culture rewards such as, "Lunch with the CEO," "Buy a book on us," and so much more!
While we recommend a peer to peer set up where anyone in your organization can give or receive recognition, you can set up Assembly however you want. If you need to limit the people who can give or receive recognition, that's perfectly fine and can be done from your Admin, here.
Assembly connects to the tools your employees use every day to offer an easy, seamless experience with minimal change management.
Assembly has integrations with HCM/HRIS systems like ADP, Google, Office 365, and Slack. We also integrate with communication tools like Slack and Teams so you and your employees can access Assembly wherever they work now.
That depends on the company's permissions set up. That said, over 90% of the employees on Assembly's platform are recognized on a monthly basis. That means nearly every employee across all of our customers are receiving regular recognition from their peers, managers, or leadership. We're extremely proud of this.
They are not required. You can use Assembly without having rewards set up. However, we don't recommend it if you intend to have a high adoption and usage rate. You can always keep the costs down by offering internal culture rewards that are fulfilled by you internally.
No, you can remove allowances from anyone or everyone. It's up to you but we do recommend using points whether they're worth a real dollar value or not. Companies that use points have a much higher engagement rate even if those points don't exchange for real dollars.
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