According to research released by Close Brothers Invoice Finance, 40 per cent of SMEs pay for a Christmas party for staff.
While two fifths of office Christmas parties are paid for by the employer, other businesses who responded to our survey asked staff to pay towards it, at least in part.
In just over ten per cent of firms, the company contributes a small amount, and in a further 18 per cent, the business does not contribute to festive party costs at all.
The majority of businesses in the private sector ask staff to contribute financially towards their own Christmas party, but attitudes towards the festivities vary based on region.
Employers in Wales are most likely to ask their workers to contribute towards the office celebrations, with just a third of companies saying that they pay in full for a party for staff. This was closely followed by the West Midlands and Northern Ireland, where similar results were recorded.
In comparison, nearly 60 per cent of businesses in London said that they pay for the Christmas party in its entirety, and a further 29 per cent stated that they cover the majority of the costs. The next most generous region was North East England where 50 per cent of businesses put funds aside for celebrations.
Despite regional differences, over 86 per cent of senior managers across the country believe that this kind of event is important for staff morale and cohesion. However, London bosses were also most likely to believe the celebrations are needed for morale, with less than seven per cent saying they did not believe them to be important.
David Thomson, Chief Executive at Close Brothers Invoice Finance, commented:
“An office party can be a great way to thank staff for all their hard work during the year by bringing everyone together to celebrate. However, in today’s uncertain times, it is perhaps unsurprising that companies are taking a more prudent approach and curbing what may be deemed as unnecessary spending.
“Ideally, businesses should try to find a balanced approach which rewards staff and engenders team spirit whilst staying within allocated budgets. These annual celebrations can generate some return on invest too, giving the leadership team a chance to share key business messages, impart positivity and motivate employees for the coming year.”