Companies have their collective hands full come December. They may be balancing increasing demands on their business with the various needs of their employees, who may want time off to travel, spend time with family, or simply decompress.

Both sides of that equation are crucial—nobody wants to lose out on new business, especially at the end of the year when it’s crunch time for meeting goals and quotas. But respecting the needs of your team is important to keeping your valuable employees happy.

Typically, with all of this to juggle, employers tend to let certain things fall by the wayside. Failing to plan properly, do due diligence, or otherwise cutting corners leads to dissatisfied employees and lower productivity as a result.

As we approach another holiday season, keep an eye out for the following six mistakes that employers make, and try not to do the same.

Mismanaging holiday pay

A small business may have two kinds of employees: Exempt and non-exempt. Exempt employees are salaried, and are thus not subject to overtime regulations, while non-exempt employees receive an hourly wage and are eligible for overtime.

During holidays, such as Christmas Day or New Years Day, it’s on the employer to give employees advance notice of the closure. If non-exempt employees aren’t given advanced notice, they may be entitled to expected pay. Exempt employees must continue to be compensated for business closures than last less than one full week.

Well before the end of the year, ensure that you’ve clearly outlined your holiday schedule, and that you’ll continue paying those who you are legally obligated to pay despite the days off.

Failing to set holiday work schedule expectations

Whatever policies or expectations you have about working in December should be clearly laid out in the company handbook, as well as discussed in meetings far in advance of the holidays themselves.

In order to ensure there are no misunderstandings between employees and management, ask your team to finalize work schedules or requests for time off before the holidays arrive. An exempt employee can refuse to work a holiday if they can establish reasonable grounds for not doing so, or if they were given short notice — which means you might put all parties in an uncomfortable position by dropping an unexpected schedule change.  

Essentially, no one should be surprised when someone does or doesn’t show up for work on a given day, even if it’s a holiday.

Putting little effort into the company holiday party

A holiday party can be a good way not only to show appreciation for the work your employees have done throughout the year but to give them a chance to relieve stress and bond with each other. The more opportunities you give people on your team to interact, the more likely they’ll establish relationships that can benefit their working environment. But many claim to dread their company holiday party and would rather skip it in exchange for an extra day off.

In order to encourage people to attend and feel excited for the opportunity to celebrate, take the time to plan and invest in the party. If budget allows, rent a venue, encourage people to bring their significant others, or even their pets, give out appropriate holiday gifts, and don’t cheap out on drinks, food, and music. Use this opportunity to show your team you actually care about them, and it will show.

Not checking to see benefits changes

The benefits packages that you offer employees, such as medical or dental care, may change slightly from year-to-year. A medical plan offered to employees may now have a slightly higher copay or deductible, or may not be available at all due to new legislation or other changes.

Check in with your HR team and ask them to relay any changes to your health insurance plans to your employees. Even a tiny change can leave workers feeling confused or betrayed.

Starting seasonal hiring too late

Lots of businesses may choose to bring on employees on a temporary basis to help with the increasing demands of the holiday schedule. But if you plan on hiring someone for just a few months, don’t wait until the week before you need them.

Start your hiring process as early as possible to identify and lock down top candidates who can bring the experience, professionalism, and skills your company needs this time of year. Otherwise, you may find yourself scrambling to fill positions at the last-second—never a recipe for success.  

Asking people to volunteer instead of work

One of the most famous HR holiday mistakes of all time came courtesy of URBN, the parent company of Urban Outfitters. URBN—perhaps having failed to plan ahead on seasonal hiring—asked their salaried workers to “volunteer” to work at their fulfillment centers leading up to holiday shopping season, billing it as “team building.”

That means that URBN didn’t have enough labor to work shifts sending out packages, so they asked their employees to do it for free instead.  

Working for free when you could be spending time with your family, or working to make more money to spend on your family for the holidays, is no one’s idea of a good time. And it’s not how you run a successful business. You should be looking for ways to excite and engage your employees this time of year, not give them additional responsibility without compensation.


Some of these mistakes may seem like no-brainers to SMB owners, but all it takes is one missed email or misunderstanding to set one of these situations into motion. Be diligent around the holidays, and your employees will be less likely to spend their days off looking for another job.

Author Bio

Meredith Wood is Editor-in-Chief and VP of Marketing at Fundera, a marketplace for small business financial solutions. Specializing in financial advice for small business owners, Meredith is a current and past contributor to Yahoo!, Amex OPEN Forum, Fox Business, SCORE, AllBusiness and more.