Clear communication, fairness, and compliance are the keys to managing workplace challenges during Chinese New Year while celebrating the festive spirit with employees.
It’s that time of the year again! The lions are dancing (don’t worry, not the real ones), Ang Pows are being eagerly exchanged (fingers crossed for a big bonus), gifts are being given and received, and everyone, not just those celebrating Chinese New Year is looking to take a well-deserved break. For HR practitioners, managing potential workplace challenges during this festive season becomes a top priority. After all, preventing issues is far better than firefighting later.
This article explores the potential issues that may arise during this joyous season and offers practical tips to help you navigate them like a pro. Let’s dive in!
No.1: Employees Giving and Receiving Lots of CNY Gifts – What Should You Do?
During CNY, it’s common for employees to give and receive gifts such as hampers, mandarin oranges, cookies, or even more substantial tokens of appreciation from suppliers, clients, and vendors. While these may seem like harmless gestures, they can sometimes create gray areas, such as:
Gifts being given to influence decisions or secure business deals.
Conflicts of interest arising from accepting or giving high-value gifts.
To avoid any potential pitfalls, HR practitioners should take proactive steps:
Reiterate the Company’s Gift Policy to All Employees: For example: a) Employees must declare gifts exceeding a certain value. b) Food gifts, such as mandarin oranges, should be shared in communal areas for everyone’s enjoyment. c) Prohibit cash gifts to maintain professional boundaries. d) Encourage transparency by requiring employees to log gifts received or given during this period.
Provide Clear Communication:
Send out an email or memo reminding employees about gift-giving protocols.
Host a quick refresher session or Q&A to clarify the company’s stance on gift-related ethics.
Set Up a Gift Declaration System:
Create a form for employees to declare received gifts.
Implement a central review process to assess any potential conflicts of interest.
What If You Don’t Have a Gift Policy in Place?
If your company doesn’t have a formal gift policy, now is the perfect time to create one. Yes, CNY might be just around the corner, but it’s never too late to start. A well-crafted policy promotes transparency, integrity, and compliance, ensuring a healthier workplace culture.
Feeling overwhelmed? Don’t worry, our consultants at Eden are here to help. We can assist you in drafting and implementing a robust gift policy tailored to your organization’s needs.
No.2: Ang Pows vs. CNY Bonuses—What’s the Best Fit?
It’s that time of the year when employees eagerly anticipate a little extra monetary appreciation, and companies look for ways to show gratitude. But as an employer, how do you decide what’s best for your organization? Should you go with the festive favorite, the ang pow or opt for a CNY bonus? Let’s break it down.
Option 1: Ang Pows, The Festive Token of Appreciation
Ang Pows are given as a gesture to celebrate the festive season and are typically modest in value. These payments are not subject to taxes or statutory contributions:
Monthly Tax Deduction: No
EPF: No
SOCSO/EIS: No
Ang Pows are perfect for showing goodwill and allowing employees to enjoy the festivities with a small token of appreciation. They’re ideal if you want to keep things light, festive, and simple.
Option 2: CNY Bonuses, Formal Recognition of Efforts
CNY bonuses, on the other hand, are payments made as part of the company’s bonus system. These are recorded in the employee’s gross income and come with statutory contributions:
Monthly Tax Deduction: Yes
EPF: Yes
SOCSO/EIS: No
CNY bonuses are more structured and serve as a formal recognition of employee contributions. They’re best if your goal is to reward employees on a larger scale and tie it to their performance or company profitability.
A Word of Caution
If you intend to give a bonus but want to avoid it being taxable or subject to EPF contributions by labeling it as an ang pow, think again. Authorities may review such payments, and mislabeling them could lead to compliance issues. It’s always best to call it what it is. If your goal is to provide a substantial reward, a CNY bonus is the way to go. If it’s simply about spreading festive cheer with a small token, then ang pows are your best bet.
No.3: Leave Management—Keeping the Balance
CNY often sees a surge in leave applications as employees take time off to celebrate or travel. Balancing operational needs with employee satisfaction can be challenging. Here’s how to manage it effectively:
Encourage Early Leave Requests:
Notify employees well in advance to submit their leave applications.
Set a clear deadline for leave submissions to allow for better planning.
Use a fair system for leave approvals, such as first-come-first-served or rotation-based scheduling.
Remind employees of any blackout dates or operational requirements during the festive period.
Plan Resource Allocation:
Review past data to predict staffing needs during the festive period.
Identify critical roles and ensure adequate coverage through temporary staffing or reassignments.
Engage team leads to help balance workloads and approve schedules.
Address Absenteeism and Tardiness Proactively :
Keep track of attendance patterns during the festive period. Address absenteeism or tardiness issues early through direct communication.
Remind employees of their responsibility to adhere to work hours. Clear communication about expectations helps reduce confusion and conflicts.
Address Employee Concerns:
Create an open channel for employees to discuss grievances or special requests related to leave.
Ensure decisions are transparent and applied consistently to avoid favoritism.
Consider flexibility where possible to accommodate personal or family commitments.
By adopting these practices, HR professionals can maintain smooth operations while allowing employees to enjoy the festive season.
No. 4: Managing a Chinese New Year Company Shutdown
During the CNY period, many companies experience a natural dip in productivity, with numerous employees taking leave to celebrate or travel. As a result, some companies decide to hit the "pause" button, shutting down operations temporarily to streamline processes, save costs, or tackle those long-overdue maintenance tasks. It's a savvy move, but here's the catch, to pull it off smoothly, you need to play by the rules and keep things fair, especially when it comes to your employees' leave policies.
In Malaysia, you cannot force employees to take leave (annual or unpaid) during a company shutdown. Decided IR cases and government guidelines are clear on this, forcing leave is a no-go. The best practice? Pay employees as usual during the shutdown. But if your goal is cost-saving, there’s still an option which is to obtain employee consent to use their leave. Here’s how to execute this effectively:
Inform Employees Clearly:
Hold a town hall meeting or individual discussions with managers to explain the company’s plan for the shutdown during CNY and the need for employees to use their leave during this period.
Be transparent about the dates of the shutdown and the reasoning behind requesting leave usage.
Request Written Consent:
After explaining the situation, employees should be asked to sign a written consent form confirming their agreement to use their leave during the shutdown.
This form should clearly outline the dates of the shutdown and any relevant terms regarding leave usage.
Employee Application via System:
To ensure the leave request is made voluntarily and transparently, employees should apply for leave through the company’s leave management system. This serves as additional confirmation of their consent and documents the leave request for transparency.
Negotiating with Employees to Obtain Consent
In cases where employees may feel burdened by using their leave during the shutdown, companies can consider negotiating a more flexible arrangement. For example:
Partial Payment by the Company: If the shutdown lasts for two days, the company could absorb the cost of one day while employees use their leave for the second day.
Salary Contributions: The company can pay a percentage of the employees' salary during the shutdown, for instance, Company pays 80% or 70% of the salary for each shutdown day.
Such negotiations demonstrate the company’s commitment to ensuring that employees are not unduly burdened by the shutdown and will make it easier for employees to consent.
Importance of Clear Communication
Effective communication is key when managing a company shutdown. Employees must be informed about the shutdown schedule, the use of their leave, and any alternative arrangements in a timely and transparent manner. The way in which this information is communicated will significantly influence employee willingness to consent to leave usage.
Clear Messaging: Make sure the shutdown message is clear and provides all necessary details about the dates, expectations, and options available to employees.
Tone and Approach: Ensure that the communication is respectful and considerate of employees’ perspectives. This approach will help foster a positive response and greater agreement from the employees.
No.5: Managing Employees Working on CNY Public Holidays
Sometimes the show must go on, even during CNY! If your business needs employees to work on this special day, it's crucial to handle it with fairness, compliance, and a dash of holiday spirit. Here's how you can keep things running smoothly while keeping everyone happy:
For Employees Entitled to Overtime Pay and Public Holiday Pay (Under Written Laws):
You have two options:
Treat the Day as a Public Holiday:
Pay the employee at the public holiday rate, which is 2 x their Ordinary Rate of Pay for normal hours worked.
For any overtime work, pay at 3 x the Hourly Rate of Pay.
Provide a Replacement Public Holiday:
With the employee's consent, replace the CNY public holiday with another day of leave.
For Employees Not Entitled to Overtime Pay and Public Holiday Pay (Under Written Laws):
For this group of employees, you can choose between these options:
Treat the Day as a Public Holiday:
Since they worked on a public holiday, provide a replacement leave.
Alternatively, check your company policy to see if additional remuneration can be offered.
Provide a Replacement Public Holiday:
With the employee's consent, replace the CNY public holiday with another day of leave.
Wrapping It Up
As the festive spirit of CNY approaches, businesses have the opportunity to celebrate with employees while navigating the unique workplace challenges this season can bring. Whether you're managing leave requests, handling public holiday work, or planning a company shutdown, it all boils down to clear communication, fairness, and compliance.
Need personalized support to implement these best practices? EDEN’s consultants are just a call away! Let us help you create tailored solutions that work for your team and company.
Wishing all a Happy and Prosperous Chinese New Year 2025! May the year bring good health, joy, and success to all!
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