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How to Throw a Great Holiday Party -- Cheap!

You can host a party your employees will actually enjoy, without breaking the bank. Here's how.

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A good party needs lots of food, alcohol, a great band, and really awesome door prizes, right?

Well, no. Not only are those things expensive, but they aren't even appreciated by all of your staff. For instance, did you know that you have staff members who would rather stick pins in their eyes than spend a Friday evening with the boss? Even though, you, yourself, are fabulous, it's still true.

Regardless of whether or not your staff wants a party, they do want the recognition that everyone has worked hard and accomplished a lot. And a holiday party, or end-of-year party, or whatever-you-want-to-call-it party, is a great way to show how much you care about your employees. Here are five ways to have a great holiday party without breaking the bank.

1. Move the party to January. If you want to have an offsite party, it will be cheaper to do it after the holiday rush and before wedding season kicks in. Hotel banquet rooms are open. Caterers aren't booked. Even that swanky band you want is more likely to be available, and at a cheaper price, in January. Plus, January is generally a miserable month, so give your employees something to look forward to, at a discounted price.

2. Hold the party during working hours and at the office. You don't have to rent a room, and you win the hearts of employees who would rather not spend their precious free time with their coworkers. Order pizza and soda. Cupcakes are still a big hit.

For those who want to participate (holiday parties are NEVER mandatory), invite them to bring a wrapped gift with a value of less than $20, and then hold a "Pollyanna" game. Here's how it works: Everyone who brought a gift draws a number. Number 1 picks a package from the pile. Number 2 has the option of picking a gift from the pile, or taking the gift from Number 1. If you don't unwrap until the end, you can all have a great laugh when it turns out that people have been fighting to the death over a bottle of store-brand perfume.

3. Forget the party. Give everyone a "shopping day." Want your employees to know they are appreciated? Close the office at noon on a Wednesday and send everyone home, with pay. Label it a shopping day. If you've got the funds, give everyone a $50 gift certificate to the local mall, grocery store, or department store. (If you do the money thing, make sure to check with payroll about the tax requirements about this--and good employers always gross up such things so their employees don't have to pay taxes on a "present.") If you can't shut the whole office, let everyone have a half (or whole) day off that doesn't count against their vacation time and let them take it sometime in December.

4. Throw a pot luck. This type of party works fabulously in some companies or departments and is an abysmal failure in others. You need to figure out beforehand if this will work for your company. Some people love them! Some people hate them. But, if you've been blessed with an accountant that makes the world's best cheesecake or a sales manager who has a recipe for Thai coconut chicken soup that will blow you all out of the water, you're in luck. Another option: host a modified pot luck where the company provides sandwiches, pizza, or burritos, and everyone brings in their favorite dessert.

5. Go somewhere fun. Instead of doing a traditional party, go to the zoo, aquarium or local indoor water park. (Keep in mind that not everyone wants to be in a swimsuit in front of their peers.) Bowling can be great fun, especially if the boss is terrible. You can often get group discounts on things like this and it can be cheaper than you think.

What things should you not do?

1. Don't exclude spouses/significant others from evening activities.  If you decide to have a Friday night party, spouses and significant others are invited. Period. And don't quibble over what "significant other" means. It's all employees, plus one guest, regardless of whether they just met on Tuesday or have been married 45 years.

2. Don't charge. A free party with pizza and Sprite is better than a fancy party at $50 a head. Don't collect funds either. Either you can afford it or you can't. It's rude to throw a party and charge your guests. Don't do it.

3. If you have alcohol, provide a way home. Yes, grownups should be careful and should be responsible for themselves. If it's a company event, you need to make it easy to be responsible. Whether it's making arrangements with a taxi company, hiring a bus, or choosing a location across the street from a subway stop, it's critical that everyone gets home safely. And, from a liability standpoint, you don't want the company to be blamed for any alcohol-related incidents.

4. Don't force people to come. Whether your party is pizza in the conference room, or a trip to the zoo, if someone doesn't want to come, she doesn't have to come. Period. This should not be reflected on a performance review, taken as a sign of whether or not someone is a "team player" or held against someone in any way, shape or form. It's a party, for goodness sakes. Some people don't like them. Some people's religions prohibit them. And some people can't find a babysitter.

5. Don't divide things by pay grade. You can have a marketing party, headed up by the head of marketing, and an engineering party headed up by the head of engineering. That's fine. But what you can't have is a "directors and up!" party. Everyone in an organization gets the same invitation. If your senior people don't want to mingle with your junior people, get new senior people. Yes, the CEO can take his direct reports to lunch, but then those people should take their direct reports to lunch as well. No A and B list parties.

IMAGE: Getty
Last updated: Nov 19, 2013

SUZANNE LUCAS spent 10 years in corporate human resources, where she hired, fired, managed the numbers, and double-checked with the lawyers.
@RealEvilHRLady




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