Beware of HR Staffers Bearing Gifts

In Northampton County and other municipalities, some employees have something called a P-card. This is a purchasing or procurement card. It's similar to a credit card. It eliminates both a cumbersome procurement process and the need for petty cash, which is always subject to abuse. It provides an electronic trail, so people like the Controller or any good government watchdog can determine whether taxpayer funds are being spent properly. But Northampton County's Department of Human Resources has basically perverted the P-card system to crate another kind of petty cash or slush funds. It is doing so by purchasing gift cards.

On January 1, Courtney Kendzejeski, who is in command of Human Resources at Gracedale, used her P-Card to purchase $1,000 worth of gift cards from Target. Human Resources Director Amy Trapp has been handing others out to some county workers. So what's the big deal?

First, gift cards totally defeat the purpose of having P-Cards. With a P-Card, you can follow the money. But once that money is spent to buy gift cards, accountability is gone. When $1,000 worth of gift cards are purchased, what assurance is there that these gift cards are actually being used to reward worthy employees? Unfortunately, the potential for fraud exists. Amy Trapp or Courtney Kendzejeski or someone else could simply keep a few or even most of those cards for themselves, and no one in the county would be any the wiser. To be clear, I have no reason to doubt the personal integrity of any person in Human Relations. But sooner or later,someone in that department will use these gift cards as his or her personal piggy bank.

Second, there is some evidence that rewarding employees with gift cards can backfire. According to one article in Forbes, they can actually demotivate workers who would prefer to see their hard work rewarded the way it should be - with a fair wage. Some will also feel that favorites are being rewarded.

Finally, gift cards are taxable income. The County derives its revenue with property taxes, yet is handing out cash equivalents to employees that it is failing to report as income. This happens to be the opinion of SHRM,where several HR staffers are members.