A box of chocolates from a grateful supplier, a bottle of wine at Christmas, a thank-you lunch from a client – gifts at work can seem like small gestures, but in NFPs especially, even the most well-meaning gift can create complexities.

Let’s say you work for an organisation that helps people access financial support – and a grateful client brings one of your team members a bag of homegrown lemons. The team member mentions the gesture in passing to you, not thinking much of it. What should you do?

According to employment and workplace relations lawyer Warwick Ryan, a manager in this instance should make sure the exchange is properly assessed and documented before that team member takes the lemons home – assuming they do at all. That might sound excessive, but the reason, Ryan explains, is that even a gift of fruit can raise questions of undue influence.

The concern isn’t the lemons themselves, but what psychologist Robert Cialdini calls “reciprocity”: when someone gives us something, we can feel subtly compelled to return the favour, consciously or not. In roles where decisions affect people’s lives, that is where the risk lies.

For NFPs, which are trusted by the community to behave ethically and responsibly, gift-giving can create real and perceived conflicts of interest – which is where an employee’s personal interests conflict with their professional responsibilities.

So how can you be sure that receiving a gift won’t land your employees in a compromising situation? We asked Warwick Ryan to explain where the line sits, and how to stay on the right side of it.

The risk of gifts and benefits

The NSW Independent Commission Against Corruption defines a gift or benefit as “anything of value”.

It may be considered any item, service, prize, hospitality or travel offered by a person or other entity that has an intrinsic value and/or a value to the recipient, a member of their family, relation, friend or associate. It includes gifts or benefits from, for example, contractors, customers, clients, applicants, suppliers, potential suppliers or external organisations.

The risk of gifts and benefits given to an employee is that they can shape (or appear to shape) our behaviours and decisions. Part of this comes down to our human tendency towards reciprocity – our instinct to return kindness or generosity. In the workplace, this might mean an employee gives more favourable treatment to a client or supplier who has offered them something.

The level of risk usually depends on the circumstances surrounding the gift-giving. For example, gifts or benefits given in a relationship involving unequal power dynamics would generally be considered higher risk than those exchanged between colleagues at a staff Christmas party.

Conflicts of interest and corruption

Most concerns around gift-giving in the workplace come down to conflicts of interest. Failure to manage these properly can create ethical and governance issues – and significantly damage an organisation’s reputation.

Ryan says the issue here is usually less about whether conduct is technically legal, and more about whether it creates the appearance of favouritism or conflicted decision-making. “For example, it’s always a bad look if you lavish gifts on staff when your organisation runs on donations,” he says.

Things become more serious when an exchange crosses into corruption – when there is a clear expectation that a gift or benefit will affect a decision or result in something being given in return. In these cases, organisations may not only face reputational harm, but potential legal consequences as well.

Ryan says the best protection against these risks is having clear policies and processes around gifts and benefits in your organisation – so employees are not left making judgement calls on their own. Without those systems, he warns, “people are going to make decisions in ways that can create vulnerability.”

Here are some simple dos and don’ts for crafting a clear policy to manage gift-giving at your NFP:

Do: Have a clear gifts and benefits policy

According to Ryan, a clear policy around gifts and benefits protects employees as much as it protects an organisation and its clients.

At a minimum, your policy should include a list of acceptable and unacceptable gifts and benefits, reporting processes and documentation requirements for when a gift has been given, any value thresholds for the gift (eg: ‘we don’t accept anything over $200’), as well as case studies employees can refer to for guidance. It should also link to a gift register where staff can record any gifts or benefits that are offered, accepted or declined (see more below).

There are lots of good examples of gifts and benefits policies online, including this one by humanitarian aid NGO RedR and this one from the Federal Government.

Do: Disclose early

Encouraging employees to disclose potential conflicts of interest around gifts and benefits early – even when they seem minor – is one of the most practical things an NFP can do. Ryan says a common risk for frontline staff emerges in NDIS and in-home care settings, where carers build close relationships with clients who may have reduced capacity or early cognitive decline.

“For example, a carer casually admiring an ornament leads to a client saying, ‘You should have it’. The client forgets, a family member starts to ask questions, and suddenly you’ve got mistrust,” he says.

Where a client insists on giving a gift, even something small, Ryan’s advice is clear: the employee should disclose it immediately, and if the gift is inappropriate, a manager should handle the conversation with the client, explaining how accepting the gift could place the carer in a vulnerable position.

Do: Maintain a gift register

A functional gift register requires more than simply logging gifts in a spreadsheet. Someone should actively review entries, ensure enough detail is provided about the gift and the context in which it was offered, and oversee how higher-risk gifts or benefits – particularly those received by managers or decision-makers – are handled and distributed transparently.

A gift register can help build a culture of trust within the organisation, as well as ensure gift-giving remains fair and ethical.

Don’t: Assume small gifts are automatically harmless

Context and power dynamics around gift-giving can sometimes matter more than the dollar value of the gift itself. Even giving something small can create a sense of obligation or blur professional boundaries – particularly where decision-making responsibilities lie. For example, a modest gift from a supplier during contract negotiations may raise more concerns than a larger gift from staff to their CEO to mark a workplace anniversary celebration.

As Ryan says, whether it’s a bag of lemons or a three-week vacation, report it. “If there’s anything someone receives that has the appearance of a gift or benefit, they are vulnerable.”

Do: Encourage open dialogue about the rules

Ultimately, getting a gifts and benefits policy right comes back to acting in the best interests of the organisation and the people it serves. Talking openly about how the rules apply in your organisation’s context helps remove uncertainty, so employees are not left making difficult judgement calls about where gratitude ends and obligation begins.

To help team members determine the best course of action in relation to an offer of a gift or benefit, the Queensland Crime and Corruption Commission recommends managers and staff explore hypothetical scenarios, considering questions such as:

• Is the intended recipient only being offered the gift because of the position they hold?
• Is the offer of the gift or benefit being made by a person or organisation who could benefit from a favourable decision either at present or in the future?
• Does the decision to accept the gift or benefit place the intended recipient in a conflict of interest situation?
• Would someone else with sufficient understanding of the circumstances perceive that acceptance of the gift or benefit could have influenced the decision?

When in doubt, Ryan says it is always better to ask questions early rather than rely on personal judgement alone.

Importantly, that culture of integrity needs to be modelled from the top. Ryan says leaders in particular should approach gifts and benefits cautiously – politely declining offers where practical and making expectations around gifts and benefits clear to suppliers, clients and other external parties from the outset.

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Getting a gifts and benefits policy right is not about removing generosity or goodwill from the workplace. At their best, clear policies and open conversations can create a fairer, more transparent workplace where staff feel supported to make consistent decisions without second-guessing themselves. They also help reduce ambiguity around professional boundaries and build trust across teams and the broader community.

For NFPs especially, where public confidence is central to the work, strong processes around gifts and benefits help protect both individuals and the organisation from ethical, legal and reputational risk. As Ryan suggests, the goal is not to eliminate every grey area, but to create systems that help people navigate them with good judgement.

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