Employee Rewards & Recognition

 
Employee Rewards & Recognition

What are Employee Rewards and Recognition ?

Reward and recognition in the workplace is a system where people are acknowledged for their engagement in intrinsic or extrinsic ways. Recognition and reward are present in a work environment where there are appropriate acknowledgement and appreciation of employees’ efforts in a fair and timely manner.

This includes appropriate and regular financial compensation, as well as employee or team celebrations, recognition of years served, and/or milestones reached.

In a nutshell, rewards and recognition (R&R) is the acknowledgement and appreciation of the staff’s exemplary performance. In this ultra-competitive business world, the winners are the ones that have staff that is skilled, professional, and well-trained.

Difference Between Rewards and Recognition

In the HR realm today, one of the recurring conundrums, is the semantic usage of two very similar yet different terms, reward, and recognition. To fully grasp the meaning of the two words we need to understand the difference between rewards and recognition and then comprehend how these two words complement each other.

Reward 🎁

A reward is a gift (something tangible) you choose to give your employees for accomplishing a goal. Employee rewards can be distributed for a number of reasons, like achieving service milestones, performance goals, and more. Common employee rewards include branded e-voucher gifts, travel tickets, bonuses, and gift cards.

Recognition 🥇

Recognition means acknowledging an individual’s achievement. These achievements are significant and have specified standards. Recognition can be awarded for any achievement, big or small, for thank yours, work anniversaries, birthdays, or going above and beyond the call of duty.

(Empuls, 2020)

Evolution of Employee Rewards &Recognition

 (www.youtube.com, 2020)

06 Types of  Employee Rewards and how to use them

There are many ways you can categorize rewards, and many of them overlap. When breaking them down into types, the goal should be to break them down into types that clarify how and why to recognize employees.

 Here, then, are 6 types of employee rewards that you can use as a guide to building an effective rewards program that team members truly value.

1. Intrinsic rewards

At the highest level, all rewards are either intrinsic or extrinsic. Intrinsic rewards are intangible, internal motivators, like the prospect of developing a new skill, receiving praise from a leader you admire, or establishing a productive, collaborative relationship with a new coworker. 

While these factors don’t tend to get as much attention as more concrete rewards, they’re an irreplaceable component of any successful rewards system. That’s because they engage on a deep level, providing meaning and satisfaction in ways other types of rewards can’t replicate.

2. Extrinsic rewards

Extrinsic rewards are the other side of the coin. They include all the tangible ways employees are recognized, from a higher salary, to additional PTO, to a heap of reward points provided by a thankful team member. 

Despite the importance of intrinsic rewards, your company can’t afford to neglect these more obvious forms of appreciation. 

Just as a high salary and great benefits alone don’t make a job worthwhile, an exceptional culture, meaningful social recognition, and other intrinsic rewards will eventually seem insincere without tangible indicators that your company values its employees.

3. Financial rewards

Many extrinsic motivators fall into the category of financial rewards. It’s the rare team member who doesn’t appreciate an increase in pay, a surprise bonus, or a gift card to their favorite restaurant. 

But monetary rewards shouldn’t stop there. Rather than limiting financial incentives to occasional rewards handed down by leadership, expand this critical form of recognition across your organization with an employee rewards platform.

Choose a solution that includes a points-based rewards system, where employees receive points every week or month they can then gift to others. The recipients can then redeem their points for personalized rewards they actually want and pay it forward by making a points gift of their own, keeping the cycle of recognition going strong.

4. Non-financial rewards

Non-financial rewards include both extrinsic motivators, like a lunch with the CEO or flexibility in when and where an employee works, and intrinsic motivators — primarily in the form of social recognition. 

Letting employees know how much their work is appreciated, whether it takes the form of a public awards ceremony or a brief message in chat, should be a frequent practice for everyone at your organization, from leadership on down. 

HR must prioritize training leaders on the importance of non-financial rewards and enable all employees to provide recognition whenever the urge strikes them with a mobile-first, easy-to-use employee recognition tool.

5. Employee incentives

Employee incentives include all the benefits your company offers to workers. Team members now expect employers to go beyond traditional incentives like retirement plans and health insurance by offering personalized benefits tailored to their unique needs. 

This can vary from something as simple as more freedom to choose their work responsibilities and projects to tuition reimbursement that enables them to pursue the education they’ve always dreamed of. 

Ask your employees what they think of your current benefits, listen to what they have to say, and take action to customize your incentive program accordingly.

6. Wellness-based rewards

Rewards geared towards boosting employee wellness are a powerful way to help improve team members’ lives both on and off the job. By integrating your employee recognition platform with a wellness solution, you can reward employees whenever they meet the wellness goals they’ve set for themselves. 

You can also encourage both mental and physical wellness across your company by offering appropriate incentives like mindfulness classes and gym memberships.

(Masionis, 2022)

06 Types of  Employee Recognition and how to use them

1. Public

Public recognition involves praising an employee’s work in a venue that other people can view. This can include recognition given at in-person events, like meetings or conferences, or written recognition from emails, social media posts, or company updates.

In one study, 84% of companies surveyed found that social recognition measurably and positively impacted employee engagement, making this an extremely effective and valued recognition type.

2. Private

In contrast to public recognition, private recognition involves acknowledging an employee’s performance only to them. You can do this with a conversation, email, or even a handwritten note.

Often thoughtful and personalized, this recognition type can show an employee that you’ve thought carefully about them and their work.

3. Peer-to-Peer

Peer-to-peer employee recognition involves an employee’s hard work receiving acknowledgment from a co-worker or peer rather than a manager. Whether private or public, this recognition can be meaningful, as it comes from someone who may work with the employee every day and know them very well.

While managers may not always be able to give peer-to-peer recognition, they can promote it by developing peer feedback systems or by promoting positive discussion at meetings or events.

4. Structured

Structured, or formal, recognition takes the form of preplanned emails, speeches, events, or other curated forms of recognition. This type of recognition often comes as part of a regular feedback process that requires the recognizer to complete many steps before giving their recognition.

For example, they may submit a piece of praise for approval or develop a quarterly event to honor high-achieving employees.

5. Milestones

Milestone recognition allows a company to acknowledge employees who have completed extensive and significant service. For example, you could recognize an employee who has been with the company for 50 years or one who has closed over 100 sales.

This type of recognition can remind employees that you appreciate their dedication to their roles.

6. Team or project

Team or project recognition honors an entire group of employees who have completed positive work. This could include a department that met its quotas for a quarter or a project team that completed its work ahead of schedule.

While individual recognition can show that you notice and value employees’ unique talents, you can also use team recognition to show how valuable their contributions are to a greater whole.

(www.workhuman.com, 2022)

10 Benefits of Employee Rewards and Recognition 

1.  An Extra health-improving Tool

Employees who are forced to work hard are exhausted, and their health suffers as a result. They’re demotivated, and depression is a possibility. Employee recognition and rewards, on the other hand, boost the health and well-being of employees on both a physical and mental level. Moreover, it boosts morale among employees by making them feel good about themselves. Depression and other health problems are less likely to strike because of this.

2.  A Higher Rate of Staff Retention

Hostile working conditions can cost a company a lot of money. It can impact the company’s bottom line if your employees are constantly putting away their paperwork. Knowing what your colleagues have contributed is an excellent way to boost morale among your staff members. With the right staff retention strategy in place, a well-designed employee recognition and rewards program can help you get greater outcomes.

3.  Engagement

Engagement is perhaps the most crucial component of the employee experience, and employee recognition and rewards are the quickest methods to create one. Employee engagement is more than twice as likely to improve in companies with high ratings for their cultures of recognition. The impact amplifies even further when individuals are frequently recognized.

4.  Productivity

Appreciation shines through in the work of employees who know they’re valued. Organizations that regularly use recognition see an increase of 14% in both productivity and performance from their employees.

When employees receive recognition and rewards for particular acts that contribute to the company’s success, their productivity soars even higher.

Repetition indeed happens when something gets recognition and reward. A whopping 92% of employees feel they are more likely to repeat behaviors for which they have been praised.

5. Improved Culture in the Workplace

An organization’s success is heavily influenced by the culture of the company within which it operates. An organization’s culture can be summarized as its goals, ideals, and overall perspective on everything connected.

Employee recognition and rewards have a good impact on the company’s culture since it fosters a spirit of mutual respect among all employees.

Having a great business culture also aids employers in attracting the best workers, thereby multiplying the long-term production of the organization many times over.

6. Motivate Others by Serving as An Example

Individuals who excel in their careers and are recognized for their efforts serve as sources of motivation for everyone.

Additionally, recognizing an employee with a recognition award encourages that employee and the rest of their coworkers to give it their all at work.

It would encourage healthy rivalry among your staff, which would help develop their skills and abilities. Making their company more competitive than its rivals is a significant benefit.

7.  Help Your Company Gain Credibility and Reputation

Customers, friends, and family members will inquire about your company’s performance after your employees leave the office.

Most likely, they aren’t even intending to communicate their feelings when they do so. Regardless of their feelings, your organization will be affected by them. If your staff are content, it will show in their behavior and conversation.

8.  Make Hiring Easy

It’s critical for a company’s success to hire capable and effective employees. Positions that need to be filled will attract candidates that are interested in working there.

Include employee recognition and rewards in your remuneration package. You’ll be more likely to get qualified applicants to apply and join your team.

In addition, these applicants will ask their friends and acquaintances for feedback on your company, and some of them may know one of your employees.

Your company’s treatment of its employees will be one of the topics on which they will focus.

It’s likely that if they have a personal connection to someone in your organization who thinks well of your firm and appreciates how much you value them, these job seekers will opt for you over your competition.

9. Enhances Interdepartmental Interactions at Work

It’s critical for departments at a workplace to be able to communicate easily with one another. It’s tough to project a positive company image and carry out effective marketing strategies without the same.

Employee recognition and incentive programs frequently focus on specific employees because they want to draw attention to the remarkable work they’ve done.

Instead of being detrimental to employee relations, group or departmental rewards can help employees get along better with one another.

Holiday packages and tours/travels are the best options in this case. They allow workers to connect in a variety of settings and build positive working relationships.

10. Motivation and Belongingness

When employees get recognition and reward for their efforts and hardships, it makes them feel good about themselves. As a result of the comfort we derive from our work, stimulate to achieve even more. When it comes to dealing with your staff, you should follow the same rules.

When an employee is commended in front of their peers, they are ecstatic. They are filled with excitement as a result of their sense of accomplishment, and this joy fuels their desire to do even better. It also instills the splendid feeling of belonging to your organization when you routinely recognize your staff for their extra effort.

Having access to these resources helps employees stay motivated and provide top-notch service to their companies. 

(Anees, 2021)

References

Anees, M. (2021). 10 Benefits of Employee Recognition and Rewards. [online] BRAVO! Employee Experience Management. Available at: https://getbravo.io/benefits-of-employee-recognition-and-rewards/[Accessed 2 Apr. 2023].

Empuls. (2020). Employee Rewards and Recognition: A Comprehensive Guide. [online] Available at: https://blog.empuls.io/employee-rewards-recognition/[Accessed 1 Apr. 2023].

Masionis, A. (2022). 6 types of employee rewards and how to use them. [online] Achievers. Available at: https://www.achievers.com/blog/types-employee-rewards/[Accessed 1 Apr. 2023].

www.workhuman.com. (2022). 6 Types of Recognition for Employees in 2023 with Examples | Workhuman. [online] Available at: https://www.workhuman.com/blog/types-of-recognition/ [Accessed 1 Apr. 2023].

www.youtube.com. (2020). The Evolution of Employee Rewards and Recognition | Employee Benefits. [online] Available at: https://youtu.be/Iy6VU9JJ5So [Accessed 1 Apr. 2023].