Gifts & Tips to Employees

It happens in the course of business that vendors and customers proffer gifts and cash tips to employees of the company. While it seems nice on the surface, a vendor or customer giving gifts or tips to an employee can open the door to arrangements made that benefit that vendor/customer and that employee at the expense of the organization. Ordering more from that vendor than is necessary, giving that vendor’s merchandise precedence getting into inventory, even pushing that vendor’s merchandise over others are some of the possible effects.

In the case of customers, accepting a gift or tip might act as incentive however unconscious for the salesperson to give that customer preferential discounts.

In addition, all vendors and customers belong to the company and not to any individual. In the case of customers, this is because:

1. the company spends a lot of money advertising to and acquiring the customers,
2. the company as a whole services the customers through repairs, inventory, warranty, banking, etc., rather than only buying or sales.

Vendors should not be gifting employees. If anyone should be getting gifts from vendors, it should be “the company,” not any individual. This is because it is the company that buys from the vendor and pays the vendor bills, not the individual employees.

For these reasons, any gifts, tips, or prizes received by employees from any vendor or business contact actually belong to the company. Any gifts or tips that are passed on to the majority shareholder, currently Leo, as per the below will come with data as to who gave the gift, its approximate value, and any other pertinent information.

Gifts from Vendors

All gifts, tips, and prizes from vendors are to be passed on to the majority shareholder, currently Leo, who will decide whether to keep the gift or pass it along to the other shareholders.

If it is not kept by any of the shareholders, the item(s) may be given to other business or customer contacts, awarded to employees by seniority, or a drawing may be announced to give any interested employees an opportunity to win the item(s).

Junior shareholders will also turn over any gifts, tips, or prizes received to the majority shareholder, currently Leo, so that they can be distributed fairly among the shareholders.

If a vendor offers you a gift, tip, or prize, graciously accept it and thank them for it, then pass it on per the policy. Never tell a vendor that you cannot keep gifts or tips. The vendor may feel embarrassed, and it could cause bad PR for the company if the vendor doesn’t understand the reasons that policy is in place.

Gifts, tips, or prizes of merchandise that come through Inventory are submitted with all paperwork directly to the majority shareholder, currently Leo, and not routed to the employee first. The person who opens and distributes the mail must inspect mail addressed to the employees to ascertain whether it contains any gifts, tips, prizes, or checks. If such are found that mail would then be routed directly to the majority shareholder, currently Leo.

Gifts from Customers

Gifts from customers, including cash tips, which are worth more than $20, are to be passed on to the majority shareholder, currently Leo, who will decide whether to keep the gift/tip or pass it along to the other shareholders.

Employees, who receive gifts, tips, or prizes from customers that are valued at $20 or less, including cash tips, or gifts of live plants or flowers, may CSW to the majority shareholder, currently Leo, and ask to keep the gift. Employees cannot keep gifts, tips, or prizes that are valued at over $20 even with a CSW request.

The CSW must be signed and in writing, not verbal or by email, and once approved and signed by the majority shareholder, currently Leo, gets filed in the employee’s file.

If a customer offers you a gift, cash tip, or prize, graciously accept it and thank them for it, then pass it on per the policy. Never tell a customer that you cannot keep gifts or tips. Don’t even hint, don’t make a face, do nothing to imply to the customer that there’s any issue with their generosity. The customer may feel embarrassed, and it could cause bad PR for the company if the customer doesn’t understand the reasons that policy is in place.

Always immediately send the customer a Thank You card for their gift.

Incentive merchandise

Incentive merchandise from vendors is actually offered to the company, rather than to any individual, and it is the company’s decision to award it to the individual salesperson.

If a salesperson has an opportunity to receive incentive merchandise, a CSW must first be written to the majority shareholder, currently Leo, to obtain authorization to receive this gift. The CSW must include all pertinent information such as its approximate value. The majority shareholder, currently Leo, may make the decision to pass it on or keep for the company if it is a gray area or particularly valuable incentive.

Conclusion

Any act to circumvent this policy in any way may result in a loss of our business for the vendor involved and may be considered cause for termination of the employee involved. Because of the potential for bad feelings and/or bad PR, any suggestion to a customer or vendor that you cannot keep a gift that is offered may be grounds for disciplinary action.

This policy is NOT meant to belittle the relationship any of you have with customers, vendors, or service providers, but it intended to prevent “unnatural” relationships and potential “return the favor” situations from developing.

All employees should strive to get bonuses and awards and to win prizes for the company, as these things can enhance the experience for everyone.