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Shari's Solutions: Holiday Gifts, Family Wellness Programs, FCRA Disclosures

Advice on all things HR from Shari Lau, SHRM-SCP, SHRM's knowledge manager. E-mail your questions to Shari at

What are some guidelines for giving holiday gifts to employees?

Isn’t it mind-boggling how something as well-intended as a gift can be so fraught with potential landmines? In the workplace, gift-givers must be mindful that a poor choice could result in a religious discrimination claim, a favoritism claim or just plain weirdness.

I remember when an executive in my division handed me a holiday card with a cartoon depicting the mounted head of one of Santa’s reindeer (Dancer, I think) hanging above Santa’s hearth. The card’s written message was humorous, but it basically implied that Dancer hadn’t pulled his weight around the North Pole that year and was beheaded as a consequence. I stared at it, wondering if I had just been fired. I realized the humor in the unintentional misstep, however, and joked about it with the executive. But others who received the same card remained silent the rest of the day. 

There is no one gift that will please all employees. Even cash may be seen by some as impersonal. So if you decide to give presents, or to allow or encourage managers to do so, here are some things to keep in mind:

First, make it an actual gift. If it’s tied to performance, that’s not a gift; it’s an earned reward. 

Second, consider the company culture. What have employees found meaningful in the past? Would a charitable donation in their names be well-received? Would giving them a day off to volunteer in some charity or school event have a positive impact? Or would they appreciate a personal day off in gratitude for a successful year?

If tangible gifts are more in line with the culture, you might treat employees to highly desired company merchandise, movie tickets, dinner vouchers, or gift certificates to online general retailers or local grocery stores. Certainly, cash gifts are generally popular; the amount can be the same across the board or determined by employee position.

If managers are the givers, remind them not to give overly personal or intimate gifts. Jewelry, perfume, religious items and clothing can be taken as overtures of unwelcome attention or can create feelings of religious discrimination. One manager I know bought the women on his team baskets of designer face lotions, not realizing they were anti-wrinkle creams. The recipients noticed. Gag gifts are also a poor choice. Many are inappropriate or feel like a waste of money to those receiving them. 

Expensive gifts from managers also should be avoided because they might make employees feel obligated to reciprocate. HR should make spending guidelines clear. A $20 maximum is common. 

Don’t forget to report to the IRS any cash gifts or gift cards as employee income and notify workers that you are doing so. You might even wish to “gross up” the gift so that employees receive the full intended value after taxes. Holiday hams or a voucher for a turkey at the grocery store are considered de minimus and don’t have to be reported as wages. 

May family members be included in wellness programs? 

Yes, although there are limitations and compliance obligations, especially when incentives are tied to enrollment in the employer’s health care plan. While you must navigate the sea of compliance laws to determine how family members can be included, it may well be worth your time. 

In a 2016 survey of 1,000 employees conducted by Welltok Inc. and the National Business Group on Health, 60 percent agreed that including family members in wellness programs would likely increase workers’ participation.

It’s easy to understand why a supportive and involved family could make wellness programs more appealing and successful. If the entire clan is involved in contests or learning, or even some incentives, the employee’s commitment to achieving his health goals could deepen. If the worker is the only one receiving wellness information, or the only family member with a pedometer provided by the employer, his spouse or children are less likely to support his effort. 

Assuming you follow all legal requirements, find creative ways to get families involved. Invite them to brown-bag lunch talks on health care topics or to evening gatherings featuring healthy cooking demonstrations. Send weekly recipes by e-mail to those who opt in for that, including spouses. Invite spouses to onsite yoga or meditation classes, or plan a family “fun run” that kids can train for, and then award medals for their participation.

Other ideas: Extend corporate rate discounts to family memberships at a gym or reimburse a percentage of the gym dues. Consider incentives for spouses to complete health risk assessments where allowable. Ask HR peers what has and hasn’t worked in their organizations. 

Can Fair Credit Reporting Act disclosure notices include a release of employer liability?

In the past, employer liability releases were commonly included in the disclosure notice that the federal Fair Credit Reporting Act (FCRA) requires employers to provide to job candidates and employees prior to conducting background checks.

However, several courts have ruled in recent years that the FCRA doesn’t allow this. With an increase in FCRA-related claims, employers are learning the hard way that anything but strict adherence to the regulations on their disclosure notices could land them in court, possibly as the target of a costly class-action lawsuit.

The FCRA regulations make several requirements of employers and stipulate the wording of the notices they must give to applicants and employees prior to conducting background checks with a third party. The one causing a stir in the courts is the mandate to provide a “clear and conspicuous disclosure” in a document that “consists solely of the disclosure” that a consumer report may be obtained for employment purposes. Any additional information given, such as a release of liability for the employer, has been interpreted as being distracting to the reader and lessening the importance of the notice, and therefore in violation of the law. 

How many of you still have this disclosure attached to your employment application? Or in a stand-alone document that also includes a release of liability for your employer, an employment-at-will statement, information on company policies or other information having nothing to do with the FCRA disclosure requirements? I’m guessing quite a few. 

If so, act quickly to update your notices before you end up in court. The remedy is simple: Ensure that your FCRA disclosure notice is a stand-alone document, clearly indicating that a consumer report (which includes standard background checks and credit checks) may be obtained for employment purposes. Use a separate sheet when paper forms are used. For electronic forms, ensure that the disclosure is noticeably distinct from other information. If you wish to include an authorization from the applicant or employee (which gives the employer permission to run the check), the Federal Trade Commission has opined that this is allowable. You also are permitted to ask for any personal information needed to run the check, such as full or former names, birth date, address, and Social Security number. In states where it’s required, you may provide a check box so that individuals can indicate whether they would like a copy of the report. 

Additionally, while the FCRA allows applicants’ signed authorization to be included in your employment application, the safest bet is to keep the disclosure notice and the authorization together in a separate document, allowing no room for doubt that the applicants knew the background check would be done and gave their permission. 

​Illustrations by James Smallwood for HR Magazine

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