The episode opens with Laverne  and Shriley decorating their Christmas tree and singing “The Twelve Days of Christmas” off key and at least for Laverne, with the wrong lyrics. Then Shriley discovers Laverne has eaten the stringed popcorn and nibbled a corner off the gingerbread star that has been in her family for eleven years.

They are visited by Rags, a neighborhood bum who organizes a yearly get together at the Pizza Bowl. He’s looking for Frank DeFazio to discuss the plans but can’t reach him. Because he’s playing Santa down at the mall and hanging out with his sidekicks, Lenny the Fairy and Squiggy the Elf while Laverne and Shirley get mauled by shoppers.

One of the kids waiting for Santa calls Santa out when he arrives, attacking Squggy the Elf and Santa and getting Santa fired. This same kid brags to Shirley that he got Santa fired and then spits in her face. (FUN FACT: the kid dissing Santa is Scott Marshall, show creator Garry Marshall’s son).

Laverne learns that her father has been playing Santa for a few days to raise money for the dinner since the Pizza Bowl has been doing lousy business. But now that Santa’s been fired Frank declares there isn’t going to be any Christmas dinner for the bums.

Carmine, Laverne and Shirley decide to try to raise funds by singing Christmas carols on the street corner. Until they’re approached by a street corner Santa and a Salvation Army band. With the three groups vying for some charitable cash, ruckus ensues, a cop gets involved and it’s discovered that Carmine, Laverne and Shirley don’t have a license to solicit money unlike Santa and Sister Sarah and the Salvations do.

Meanwhile Frank is bummed that the bums won’t be coming to dinner. When all of a sudden, Laverne and Shirley rush in with the bums led by Rags. He states that all they want is to just be there at the Pizza Bowl, dinner or no dinner. Although they did bring a can of spam, a can of corn and a banana.

Frank is still disappointed because he wanted to do something special. But Shirley tells him, “Don’t you understand? They don’t come here for just the dinner.” Laverne adds, “That’s right, Pop. They come here so they can be with all of us. That’s what’s special to ‘em.”.

Lenny and Squiggy save the day when they come in with a turkey, stuffing and cranberry sauce. And now they can no longer date the butcher’s daughter.

And remember, Christmas ain’t turkey. It’s PIZZA!