Here's What A Typical Holiday Bonus Looks Like (And A General Guide For If You'll Get One)

The holiday season is about giving, especially at work. This time of the year, many employers hand out bonuses as a big "thank you" for a year of hard work. These bonuses aren't just extra cash for holiday shopping; they also boost morale and make everyone feel valued. It's a fun and generous way to wrap up the year and get everyone excited for what's next.

Bonuses can come in many forms. Cash is the most common, and it might be given as a fixed sum or a percentage of your yearly salary. Some employers prefer giving gift cards to popular stores, adding a personal touch. Or they might go for something different like spa days, health insurance, gadgets, company swag, or even extra vacation days. Then, there is 13th month, where you get paid your regular salary twice in December. 

Holiday bonuses can really vary. They depend on things like how big the company is, the awesome stuff you've done during the year, or just what's normal in your industry. For example, big fields like finance, mining, engineering, and tech often dish out the hefty bonuses, while other areas might go for something a bit more modest. Also, how well the company did that year plays a big role in how fat that bonus check is. Still, don't fret. Your employer might be "compensating" you in other aspects such as employer 401k matching or health insurance.

Back in 2020, the Bureau of Labor Statistics reported that, on average, employees got a bonus that was about 9.6% of their yearly salary (via Plentive). So, if you were making $50,000 a year, you'd likely see a bonus around $4,800. That year, bonuses were pretty generous across the board. More recent updates show that holiday bonuses have dropped. A 2023 report mentioned by USA Today found that bonuses went down by 21% from previous years, mainly due to economic challenges and changes in how workplaces operate. Retail and hospitality took the hardest hit, facing big financial pressures. 

On the other hand, industries like legal and finance are still handing out hefty bonuses, often more than 10% of an employee's yearly salary, because they really want to keep their best people around. In industries like hospitality and retail, where profits aren't as high (and they are victims of mass closures of major stores nationwide due to lack of profit), bonuses tend to be smaller. Unlike the big cash bonuses common in finance, legal, and tech, these service-focused sectors often give out bonuses like gift cards, merchandise, or extra vacation days. For instance, a retail worker might get a $50 gift card to their own store, while a financial analyst could score a bonus that's over 10% of their yearly salary.

To know if you're in line for a bonus, check your employment contract. This will tell you what you need to do or how long you need to have been with the company to qualify. Individual performance also matters. If you've really knocked it out of the park or gone beyond what was expected, you might see a bigger bonus. This is often referred to as performance-based incentives. Some companies can rely on team achievements, especially in jobs where working well together is key.

The economy determines holiday bonuses too. Things like inflation or specific industry challenges can tighten a company's budget for bonuses. So it is a no-brainer that you can expect a generous bonus if the industry is great. Employees can stay in the loop about potential bonuses by keeping an eye on company-wide announcements or by asking their managers during performance reviews.

It's key to remember that bonuses aren't guaranteed. They're a discretionary benefit that can vary by industry, employer, the company's financial health, and what's in your employment contract. Unless it's specifically mentioned in your contract or the company's policies, a holiday bonus isn't a legal right. To be sure, look for major red flags in an employer as well as what to do if your employer doesn't pay you.