Management: The Economy that Stole Christmas

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Many corporate holiday celebrations have been halted by one of the worst economic downturns in recent history. Major corporations, including Viacom, American Express and MTV, have announced they will downsize or cancel this year's shindig. While employees may be willing to forego a spiked eggnog or two, many are still wistfully hoping for year-end bonuses. Unfortunately, bonuses are a gift that many businesses won't be able to deliver this year.

How do you break the difficult news to your spa employees? There are several ways to soften the blow, according to Leslie Hunt, a spa consultant with Miller Consultants (www.millerconsultants.com), in Louisville, Kentucky. She understands first-hand the dilemma spa owners face in wanting to reward hard-working employees in a weak economy. Hunt's own venture, Centre Ville Spa and Salon (www.cvspasalon.com) in Kingsport, Tennessee, opened in May.

Here are three things to consider before you write—or write off—the possibility of this year's bonus checks.

Star Quality
Spa owners and managers should focus on rewarding and coaching star performers. If your budget is tight, limit monetary gifts to the most worthy employees. "When business is slow, employees with initiative ask how they can help instead of sitting around," Hunt says.

Year-Round Effort
If you do choose to only give some of your employees bonuses, it shouldn't come as a surprise to those who were overlooked. That is, so long as you've established guidelines from the get-go. Each new employee should express a written understanding of the spa's compensation system, which includes the fact that bonuses are distributed at the owner's discretion.

Employee's Choice
What do you do if budget constraints force you to withhold bonuses from star employees? Put the matter into their hands by asking them to suggest other means of compensation, Hunt advises. One possible way for a spa owner to engage an employee in that dialogue: "As you know, our business is down right now, and I won't to be able to give you the nice bonus that I wish I could," Hunt says. "What are some other ways that I can show you how much I value you that would be appealing?"

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