Gifts and Benefits - Can they Land you in Hot Water?

- Monday, January 11, 2016
Gifts and Benefits: Could They Land You in Hot Water?

Everyone loves perks – they are quite often what makes a job just that bit more enjoyable. The benefits of on-the-job perks were clear in the film The Devil Wears Prada for example, in which the heroine sought a makeover at her fashion magazine employer as a last-ditch effort to save her job. She went from a bespectacled, frizzy-haired, lumpy jumper-wearing assistant, to a sleek perfectly coiffed professional with an enviable designer wardrobe. 
Unfortunately, this scenario is not the norm, and some perks can actually land employees, and sometimes their employers, in hot water.
Why is it an issue?
There’s a big difference between a perk that is provided by an employer and a gift or benefit that is given by an external party. Gifts and benefits can take almost any form, including: 
  • Cash or shares. 
  • Items promoting an organisation (for example, t-shirts with a logo). 
  • Air tickets, accommodation and car hire. 
  • Wine and meals. 
  • Theatre and sports tickets. 
  • Discounted commercial items.     
The risk of an employee accepting gifts and benefits is that the employee is not necessarily acting in the best interests of the employer or client; they are acting in their own interests. This is a particular issue in the area of procurement.
Gifts and benefits in the public sector
Sometimes in the public sector, gifts and benefits can be construed as undermining public confidence. The Australian Public Service Commission (APSC), in its Gifts and Benefits Policy, gives the example of a tender process that is supposed to be open and transparent. If the decision-maker has received a gift from the tender-winning organisation, there may be a perception that the decision was influenced. 

It is about actual or perceived conflict of interest. At worst, a gift or benefit could be perceived as a bribe that exposes both the recipient and the donor to bribery allegations. There is a maximum penalty of 10 years’ imprisonment for accepting a bribe. 
In the public service, all valuable gifts and benefits must be disclosed to the Gifts and Benefits Register, although “valuable” is not defined by the policy. The APSC recommends that all gift or benefits are disclosed, regardless of their value.
Gifts and benefits in the private sector
Gifts and benefits in the private sector are not usually governed by the same strict rules. 

While gifts of wine or flowers may be considered inconsequential, employers should be more concerned if the employee is treated to an all-expenses paid weekend away by an external party, season theatre tickets or some other gift or benefit of substantial value. 

While wining and dining are part of the norm for many private organisations, employers should carefully consider developing a policy dealing with gifts and benefits, in particular: 
  • Reminding employees of their fundamental obligations to act in the employer’s best interests. 
  • What is acceptable interaction with external parties. 
  • What gifts and benefits should be disclosed (for example, valuable gifts or regular lunches hosted by the external party). 
  • How gifts and benefits should be disclosed. 
  • Appropriate measures in place to prevent procurement fraud. 
  • Consequences for inappropriately accepting gifts and benefits, for example disciplinary measures and termination of employment. 
If, when or how to accept gifts and benefits can be a difficult issue for organisations and employees. Everyone benefits from clear expectations and guidelines, and so a properly drafted policy is essential.  
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