Employee Gift Matching Programs: Things to Consider

by | 6 Mar, 2019

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In our previous blog post, we discussed the benefits employers can enjoy from offering an employee volunteering program, including increased team morale and improved brand perception and corporate visibility. Offering an employee volunteering program, however, is just one way employers can get their employees involved in giving back to the community. Another great way is through corporate giving, and more specifically, employee gift matching.

Employee gift matching is a corporate giving structure that allows employee contributions to certain organizations to be matched by the employer. For example, if an employee chooses to donate $100 to a food bank and the employer matches their gift, the organization will receive a total of $200 from the company. Offering employee gift matching is a great way to incentivize employees to participate in corporate giving, and it makes their monetary donations stretch much further, greatly increasing impact.

Many larger companies already have some sort of employee gift matching program in place, but smaller businesses tend to be lacking in this area. According to one report, 65% of large companies match while only 28% of small to mid-size companies match. Still, offering an employee gift matching program has benefits for large and small companies alike.

Here are the main benefits of offering employee gift matching:

  • Increased employee participation. When employers offer gift matching, employees are more likely to donate because they feel that their donation is going further with the employer’s added contribution.
  • Streamlined giving. When employers select certain organizations for employees to donate to, they vet those organizations to ensure they are reputable and meet corporate and legal requirements. This relieves employees of the burden of researching the organizations themselves and allows them to give more easily and effectively.
  • Tax benefits. With any form of corporate giving, companies are eligible to receive a tax deduction on the company’s annual earned income. That being said, state and federal laws on tax deductions for charitable contributions vary, so employers should consider consulting with legal counsel or tax professionals to determine if possible tax deductions apply.
  • Enhanced company brand. A well-established corporate giving program establishes the company as one that cares about giving back to the community. This enhances the company’s reputation in the eyes of employees, partners, and consumers.

Here are some considerations employers need to make when deciding to offer an employee gift matching program:

  • The match ratio, which is the amount the company is offering to pay in relation to the employee’s donation. The most common match ratio is 1:1, but some companies offer 0.5:1 or 2:1 match ratios. In addition, sometimes the match ratio varies by employee status. Part-time employees, executives, and retired employees may all have varying match ratios made available to them.
  • Minimum and maximum match amounts. Most companies will set lower and upper limits for the dollar amount of an employee donation that they will match. Thus, if employees donate below a certain amount, they may not be eligible for matching by the company. Similarly, companies may specify that they will only match employee gifts up to a certain amount.
  • Deadlines. Companies usually establish a deadline for employees to request gift matching. The deadline is totally up to the employers to decide, but it is usually established either as the last day of the year, or Tax Day, typically on or around April 15.
  • Selected organizations. While some companies allow complete discretion to employees to select which organizations they choose to donate to, many companies choose a select list of organizations or specify certain causes that are eligible for employee gift matching.

In conclusion, offering employee gift matching is a great way for employers to strengthen the company’s corporate giving program. Doing so has benefits for large and small businesses alike, but small businesses may find it difficult to successfully develop and implement such a program. Want to learn more about how Navigate can help with matters such as this? Contact us today to request a free HR consultation.

Leah Bury
Leah Bury was former Marketing Manager at Navigate PEO, and holds a BS from Northeastern University. She contributed pieces and HR tips and created The Compass, our monthly newsletter!

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