Secret Santa, not secret liability: Keeping workplace gift exchanges festive and risk-free

For many workplaces, the annual Secret Santa exchange is a highlight of the holiday season – a chance to spark joy, share a laugh and build connection. But even the most well-intentioned gift exchange can expose employers to unnecessary risk if not thoughtfully managed.

As with any employer-sponsored activity, gift-giving occurs within the employment relationship, and issues such as harassment, discrimination, conflicts of interest and workplace boundaries may arise if expectations are unclear.

Below are practical, employer-focused tips to help ensure your holiday gift-giving traditions stay festive, inclusive and risk-free, without dampening the spirit of celebration.

Gifts gone wrong: Lessons from the case law

Although Canadian case law on inappropriate Secret Santa gifts is limited, several decisions offer helpful guidance on how tribunals approach inappropriate holiday-related conduct.

In OPSEU v Ontario (Ministry of Community and Social Services), 2006 CanLII 37572 (ON GSB), Ontario’s Grievance Settlement Board upheld the public sector employer’s decision to prohibit an employee from attaching Scripture verses to Christmas gifts distributed to co-workers. While the employee argued this restriction infringed her religious rights, the Board held that the employer was entitled to maintain a neutral, inclusive workplace and prevent employees from imposing religious messaging on colleagues.

The decision illustrates that employers may set reasonable limits on the content of holiday gifts in order to protect other employees’ comfort, dignity and freedom from unwanted proselytizing.

And while not Canadian, a recent United Kingdom Employment Tribunal decision offers a striking example of how quickly a workplace holiday gift exchange can create unexpected issues.

In B Cochrane v Neerock Ltd T/a Woodheads, [2025] UKET 6000762/2024, employees participating in a Secret Santa exchanged a mug that displayed explicit sexual imagery when hot liquid was added. The gift was given to another team member, and a photo of it was later shared in a workplace group chat. When a new employee later joined the chat, he scrolled up, saw the explicit mug photo alongside messages mentioning his name and noting that he was not yet in the chat, leaving him with the mistaken impression that the mug and the jokes were about him. He subsequently filed a sexual-harassment complaint. The Tribunal ultimately dismissed the claim, finding the exchange was not directed at him and did not amount to unwanted conduct of a sexual nature.

Still, this case illustrates how even “joke” gifts can escalate into formal complaints and be subject to legal scrutiny when shared in the workplace.

These decisions reinforce a simple message: holiday activities are not outside the scope of respectful-workplace and human-rights obligations. With thoughtful planning and clear communication, employers can support festive fun while minimizing risk.

To help make your gift exchange a success without compromising professionalism or inclusivity, consider the following best practices:

• Make participation optional: Not all employees celebrate Christmas or feel comfortable participating in gift exchanges. Clearly communicate that participation is voluntary and that choosing not to participate will not affect an employee’s standing in the workplace.
• Set expectations around appropriateness: Encourage employees to select gifts that are suitable for a professional setting. Discourage items that are overly personal, intimate or intended to embarrass. Reinforce that workplace policies regarding harassment, discrimination and respectful conduct apply to all employer-sponsored holiday activities, including gift exchanges.
• Promote inclusivity: Be mindful of diverse cultural and religious backgrounds. Consider neutral, winter-themed exchanges rather than Christmas-specific traditions, and advise employees to be respectful of colleagues’ beliefs when giving or receiving gifts. In some cases, it may not be appropriate for an employee to accept a gift due to their religious beliefs; encouraging employees to ask before gifting can help prevent discomfort.
• Provide guidance on gifts from clients and vendors: The holiday season often brings increased gift-giving from external partners. Remind employees of any policies regarding accepting gifts, including value limits, required reporting and potential conflicts of interest. Transparency helps protect both the organization and its employees.
• Establish reasonable spending limits: Setting a modest price range helps prevent employees from feeling pressured to overspend and ensures the focus remains on participation rather than financial expectations.
• Encourage managers to model appropriate behaviour: Leaders set the tone for workplace culture. Their participation in gift exchanges should reflect the professionalism and inclusivity the organization expects from others.
• Create a clear mechanism for raising concerns: Employees should know whom to contact if they feel uncomfortable with a gift or related behaviour. Promptly addressing concerns can prevent situations from escalating and helps maintain a respectful environment.

And if your gift exchange is part of a larger holiday celebration, remember that alcohol and social settings can heighten risks. See our previous insight, “Have fun, be festive, don’t get sued: Tips for employers this holiday party season,” for guidance on keeping events enjoyable while avoiding liability.

Holiday traditions can play an important role in fostering camaraderie and morale, but they also present unique challenges. With thoughtful planning and clear expectations, employers can enjoy the benefits of workplace gift exchanges while minimizing exposure and reinforcing a respectful, inclusive culture.

If you have questions about holiday-related workplace events or potential liabilities, our labour and employment team is here to help. Contact us to ensure your organization is prepared for a safe and festive season.

Share