Do you understand the importance of praising an employee for a job well done?
During a very challenging year, we learned a lot about the positive impact that fun and easy employee recognition can have on employee motivation and team morale.
To acquire and retain the top performers, you must build a workplace culture where employee recognition is the everyday norm. This essential guide provides the basics of employee rewards and recognition and how to support a culture that engages and retains employees.
In this guide, you’ll get to learn:
- Importance of employee recognition and rewards
- Alarming stats on rewards and recognition
- Employee rewards and recognition ideas
- Implement a successful recognition program
- Real-life examples
Let’s get started with our In-depth guide:
What Is Employee Recognition?
“People work for money but go the extra mile for recognition, praise, and rewards.” –Dale Carnegie
Workplaces are transforming dynamically. With the changing scenario, employee recognition is not a mere task that managers tick off from their to-do list. Offering timely (and regular) rewards and recognition is a necessity.
According to Wikipedia,
“Employee recognition is the timely, informal or formal acknowledgment of a person’s behavior, effort, or business result that supports the organization’s goals and values, and exceeds his superior’s normal expectations.”
In simple terms, employee recognition is the open acknowledgment and expressed appreciation for employees’ efforts and contributions to their organization.
It could be a simple thank you, a high-five, a special shout-out during the meeting, or even a bonus or gift for a job well done.
Who can give recognition?
Ideally, every employee in an organization should be able to give each other recognition.
Will recognition work for my team?
A BIG Yes. It builds stronger teams, cultivates rich company culture, and encourages employees to do their best work.
Remember, If you fail to show your employees that you notice their contributions and how much you value it, they will never give you their best.
Employee Recognition Vs. Rewards
“There is more hunger for love and appreciation in this world than for bread.” – Mother Teresa
Now the question arises: Are employee rewards and recognition the same?
Not at all. There are some subtle but critical differences which we have illustrated as follows:
|Rewards are tangible.||Recognition is intangible.|
|Rewards are transactional and have some monetary value attached to them.||Recognition is relational and has an emotional value attached to it.|
|Rewards are tied to goals and accomplishments.||Recognition can frequently happen and in the moment.|
Employees need both rewards and recognition to feel fully satisfied with their job.
Recommended Article: 24 Creative Employee Recognition and Appreciation Ideas for 2021 [Updated]
Amazing Statistics on Employee Recognition and Rewards
“Always treat your employees exactly as you want them to treat your best customers.” –Stephen R. Covey
Even though employees receive a salary, they still get a spark of joy and excitement when offered a genuine and spontaneous gift and appreciation.
Here are some compelling findings from research and industry surveys on employee rewards and recognition:
1. According to this study, 37% of employees consider recognition is must.
3. Well-designed rewards and recognition programs can drive an 11.1% increase in average employee performance. (Source)
4. 83% of HR Leaders say an employee recognition program benefits organizational values. (Source)
5. 53% of people said feeling more appreciation from their boss would help them stay longer at their company. (Source)
6. According to Cicero, 69% of employees would work harder if they felt their efforts were better appreciated.
7. When asked what leaders could do to improve engagement, 58% of professionals endorsed giving recognition. (Source)
8. According to Gallup’s research, lack of recognition is one of the most common reasons why employees leave an organization.
9. 59% of employees feel they’re not being rewarded effectively. (Source)
10. A survey found that 47% of employees want to receive a personalized reward spontaneously. (Source)
Why Rewards and Recognitions are Important
“To win in the marketplace you must first win in the workplace.” –Doug Conant
A well-implemented employee rewards and recognition program has the power to impact employee engagement, turnover, productivity, morale, and purpose.
Here are some reasons why you should build the best employee recognition program:
Gallup found employees who are not adequately recognized are 2x more likely to say they’ll quit in the next year.
Employee turnover costs more than you think. Between posting a job, screening and interviewing candidates, assessments, negotiating, relocation bonuses, paying referral or signing bonuses…just the cost of filling a position adds up.
Employee recognition and rewards are great ways all employees appreciate and respond to. It’s a critical step in reducing turnover.
Recommended Article: Key Employee Retention Statistics For 2021
Authentic recognition and positive feedback boost employee engagement. In turn, employees are more productive. Take the time to appreciate employees, it pays huge dividends on your bottom line.
Studies have shown that a simple expression of thanks by someone in authority led people to be 50% more productive!
When managers understand the true purpose of employee recognition, it improves their morale on an individual level. High morale inspires greater productivity, creativity, and overall satisfaction.
A recent SHRM survey found that 65% of employees say respectful treatment of employees at all levels is a very important contributor to their job satisfaction.
Recognizing employees’ work and their contributions encourage a sense of purpose. It helps employees understand how their work ties to the company values and how their efforts matter.
Frequent and instant recognition reminds everyone that they’re all working toward a shared goal.
Types of Employee Recognition and Rewards
“An employee’s motivation is a direct result of the sum of interactions with his or her manager.” –Dr. Bob Nelson
Employee recognition and rewards will vary from company to company, and how you appreciate employees will depend on your company’s needs. Let’s take a look at five key types of recognition:
1. Micro recognition
Micro-recognition is an amazing tool for making positive, measurable changes quickly. It refers to appreciating and providing feedback immediately in response to a task or behavior. Micro Recognition is the perfect way to support organizational values on a regular basis and make employees feel valued without requiring a ton of time and resources.
2. Formal recognition
Formal recognition is a structured program with defined processes for how to nominate someone for an award. Typically these programs have an award ceremony to publicly recognize employees in a formal setting.
3. Informal recognition
Informal recognition is given to individuals or teams for progress toward milestones, when they achieve goals, or when they complete projects. This may come in the form of a pizza party, potluck, or a trip to the pub for happy hour—a low-cost memento presented spontaneously.
4. Peer-to-peer recognition
With peer-to-peer recognition, team members feel empowered as their efforts are recognized by one another daily. They feel a sense of belonging to the organization and are motivated to perform their best.
Recommended Article: Peer to Peer Recognition at the Workplace [2021 Updated Guide]
Bonuses are one of the most popular types of employee recognition. They range from small to large, depending upon the contribution and task accomplished by the employee. Bonuses are monetary rewards that managers can give to their team members or even vice versa. Since the nature of the reward is immediate, bonuses help employees stay motivated.
Employee Reward and Gift Ideas
“Nothing great was ever achieved without enthusiasm.” –Ralph Waldo Emerson
Now that you understand how important employee rewards and recognition are, get inspiration from these creative employee reward ideas.
1. Reward points
Create a point-based reward system for ongoing recognition. Employees are awarded points for every time they do a great job. Also, allow employees to redeem their points for gifts. You could offer a variety of rewards for the employees to select from.
2. Gift cards
There is no end to the choice of gift cards that you can give to your employees. Be it Amazon, Flipkart, or beauty brands like Bodyshop, etc., you can choose from any of them depending upon the preferences of your employees. Alternatively, you can also gift them a meal voucher or a spa coupon that could make it a perfect day for them.
3. Surprise gift bag
You can make the whole gift-giving fun by curating a few combinations of gift hampers for your employees. The hamper can have items such as gift vouchers, office essentials, phone covers, water bottles, chocolate, cookies, etc.
4. Company swag
Company swag kits are a great way to build team culture and engagement. What can you include in this kit?
– Water bottles
– Tech Accessories
(Company branding logos on all the products)
5. Online classes
There’s a plethora of online classes and courses out there for every subject under the sun. Offering sponsored online classes of their choice to employees make for a great corporate reward option.
6. Cab credits
If your employees travel to work or otherwise, offer them cab credits. Help them cut down on their commute expenses.
7. Free event tickets
Event tickets are another great, custom-tailored reward you can offer to your employees. A cricket match being organized in your employee’s city? Give them free tickets to witness the thrill and craze with their own eyes.
8. Vacation benefits
You can offer vacation stipends to improve an employee’s long-term health and well-being. Vacations allow employees to spend quality time with family and friends and return to work recharged.
We live in a world of subscriptions, right from Spotify Premium to Apple Music Plus, Netflix, Amazon Prime Video, Zomato Gold, and many more. Everyone these days has a playlist that is jarred by the occurrence of an ad. Or, they are missing out on some great content in their free time.
10. Book club
Have a few bookworms on your team? Having a book club can bring coworkers together in wonderful ways. Let them choose the book format — whether it’s an audiobook, ebook, or printed book.
11. Pet at the office
Having a pet-friendly office has a ton of benefits for employees. Banfield’s PAWrometer™ shows that 67% of employees believe pets help increase productivity. Allowing pets in the office can help in reducing stress and making people friendlier.
12. Personalized mugs, keychain, and T-shirts
Who doesn’t love to have a mug on their work desk with their name on it? Or even a keychain for their vehicle that is as stylish as their engraved picture? Personalized stuff is really cool to have around and make your employees feel loved and valued by your organization.
13. Yoga classes
Reward your employees with a membership to a yoga class or other fitness program. The goal is to create a culture where employees choose to live a healthier lifestyle.
14. Plant subscription
Give your employees a plant subscription box. We recommend low-light, easy-care plants like succulents and cactus!
15. Meal home delivery
Take away the burden of cooking for a week. Bring in vendors to offer meals ready to take home or pay for a week’s/month’s subscription for a meal delivery service like Freshly. If they want to go the extra mile and cook it themselves, try a meal-delivery service like Hello Fresh.
Recommended Article: 80 Employee Benefits Ideas for Remote Workers [2021 Guide]
Employee Recognition Ideas
“Take time to appreciate employees, and they will reciprocate in a thousand ways.” –Dr. Bob Nelson
Here are some employee recognition ideas that your employees will love:
1. Thank you note or card
One of the easiest and effective ways to recognize great work is by handwriting a thank you letter. Or just leave a sticky note saying “Thank you message” on their desk.
2. Celebrate employee anniversaries and birthdays
If you want your employees to have a sense of belonging in your organization, you must make their journey valuable. One of the best ways to do this is by celebrating their birthdays and anniversaries. Send them personalized emails or arrange a small team get-together to cut the cake.
3. Surprise day off
If there is one thing that employees love, it is a day off. Recognize the hard work your team puts in every day by offering them a surprise day off. While this will motivate them to perform their best, it will also display your caring nature as an organization.
4. Wall of fame
How about a wall of fame with pictures of your top-performing employees? You can either arrange this for individual teams or an entire floor. Pick a board and just put it over a wall. Now, put up the pictures of your top-performing employees either in a team or from the entire office. This employee recognition idea works by the power of social influence.
5. Performance-based recognition
Performance-based awards have continuously proved to be a compelling source of recognition for a long time. For example, some of your team members might have helped improve social media engagement rate significantly. Therefore, they must be rewarded for their due efforts.
6. Appreciate non-work achievements
Sometimes non-work achievements must also be recognized by the organization. They might be creating something, helping an entire community get educated, volunteering, or anything else. Let everyone know about these people by celebrating their achievements at work.
7. Award certificates
There is nothing better than letting an employee know of their hard work and value to a company. Create a personalized employee award certificate.
8. Website or newsletter feature
Showcase your employees’ stories or milestones in your company’s newsletter or blog page. Consider including a spotlight section in the Newsletter where employees know the company’s top performers’ stories.
9. Shout out on social media
Simply post a pic of your employees on social media and brag about their achievements. Employees naturally spend a huge amount of time on various social media platforms. Let them flaunt their recognition on these platforms.
10. Lunch with CEO
Scheduling a lunch date each month where employees can earn a place at the dinner table with the CEO is a great way to recognize their contributions.
11. Provide professional development
Offer your employees training and other relevant resources that help them advance their careers. You must encourage them to continue their education and even help pay for it.
12. Team trophy
A team trophy is a souvenir of all the hard work teams have put into accomplishing a project. Make recognition memorable for your employees by giving them a team trophy.
13. Gamify the workspace
Nobody wants to walk into a dull workspace every single day. Why not recognize your employees’ hard work by transforming their workspace. Add a basketball hoop or a pool table where they can go and just chill.
14. Write a LinkedIn recommendation
LinkedIn is where an employee represents their professional portfolio. As a leader, you can recognize their efforts to your organization by writing them an excellent recommendation. Give a shoutout to their sweat and blood.
15. Donate to a charity of their choice
Kindness goes a long way in life. When recognizing your employees’ hard work, the excellent idea is to donate to a charity of their choice. This way, you’re valuing your team as well as doing your bit for society.
16. Host a hackathon
We recommend hosting a hackathon (pizza, too)! 🍕🤖Allow teams to hack anything. Let them work on the projects that employees really want to work on but are often pushed aside.
17. Implement peer recognition program
Make it easy for your employees to show appreciation for each other. Team members work together and spend most of their time with each other – they have more interpersonal contact than their manager. So recognizing your peers is a more authentic approach.
18. Surprise team lunch
Employees must have the perks of being associated with your organization. If your team has accomplished a task, take them out for a surprise lunch.
19. Project completion party
Completing a project takes days and nights of work, which must be rewarded well. Celebrate little milestones with a fantastic party for your employees.
How To Build A Successful Employee Rewards and Recognition Program
“Brains, like hearts, go where they are appreciated.” –Robert McNamara
By now, it’s clear that having an employee reward and recognition program makes engaging employees a lot easier.
Sound good? Good. Now, where do you start?
Well, you’re in the right place! 🎉
Here are some best practices to build a successful employee recognition and rewards program:
1. Define Your Vision
- First, write down your goals and objectives. Is it to improve the level of employee engagement? Or to build a better company culture?
- Do research about the benefits that a recognition program can bring to your company. Read all the tips, tricks, and best practices and implement them into your program.
- It’s important to have a cost estimation (including hidden costs) of recognition programs.
2. Build a Committee
Your next step is to build a team to help you implement the program. Appoint a few people who will be responsible for implementing, managing, and establishing a recognition program.
When building your team, look for people with the following characteristics:
- Good knowledge of the program benefits.
- Positioned as a team leader.
- Should have an interest in the program.
- Believes in company values.
3. Understand the Characteristics of Recognition
The next step is understanding the characteristics of the recognition program:
Timely: It is considered a good practice to recognize someone as soon as the deed is done.
Frequent: Don’t wait for a huge milestone or achievement to give recognition. Celebrate small wins.
Specific: Specific recognition helps employees understand exactly which of their efforts contributed to their company’s goal.
Value-based: Think about how a contribution lines up with your company values.
4. Define Clear Program Criteria
If you’re starting a recognition program, you should be clear about what behaviors or actions you’d like to see from reward programs and how they impact business objectives.
Answer some of the important questions first:
- What type of behaviors should be rewarded?
- How should the said behaviors be rewarded?
- How often should employees be rewarded and appreciated?
- Who should recognition come from?
5. Hear Employees Voice
Make the process fun! Encourage your employees to better understand the types of rewards they’re most interested in.
Brainstorm ideas with your team. Once you’ve drafted ideas for creative rewards, send a survey to employees and ask everyone to rank the options.
Make employees aware of the program, how to use it, the benefits, and encourage them to give their feedback and inputs.
6. Measure Program Effectiveness
Your recognition program impacts many different areas of an organization, including the productivity, business results, and brand value. You must measure the effectiveness of the program.
Use data from your recognition program to inform other business decisions. Research if any team or employee is isolated, review how teams are connected, and facilitate collaboration where needed. Once you’ve collected actionable data, make improvements where possible.
Recommended Article: Employee Recognition Program: The Complete Guide [2021 Updated]
Real-life Examples of Employee Recognition and Rewards in Action
“Treat your employees like an investment, not a cost.” – Dan Sullivan
It’s not always easy to come up with creative ways to recognize and reward your teammates for their great work, so we put together a list of unique examples from some companies across the globe.
1. Paypal India | Performance-based Rewards
Paypal India’s performance-based awards recognize all full- and part-time employees’ actions, behaviors, accomplishments, and performance.
Employees nominated for this award should display the highest level of judgment, innovative thinking, commitment, and passion for the job.
Cash prize awards are Cosmic Kudos (INR 10,000), Blue Moon (INR 15,000), and Shining Star (INR 20,000).
2. FullContact | Paid Vacation
FullContact has a “Paid, Paid Vacation” concept. They give employees $7500 to go on vacation.
But there are a few rules: Employees have to go on vacation, or you don’t get the money. Employees must disconnect. Employees can’t work while on vacation.
3. Hubspot | Learning Programs
Hubspot believes in employee learning and development, both professionally and personally, to make them better, smarter, quicker, and to enable them to always be growing.
Hubspot provides ongoing learning opportunities like the Free Books Program, the [email protected] online platform, a mini-MBA Fellows program, HubTalks, workshops, and more.
4. Legal Monkeys | Appreciation Board
Legal Monkey’s Appreciation Board allows every employee to write down comments and positive feedback to fellow staff members.
The use of social media comes to play subsequently when they share the Appreciation Board comments on their Facebook page and Twitter feed.
5. SnackNation | Crush It Call
Each Friday afternoon, the SnackNation team comes together to recognize another team member’s hard work and efforts during that week. Watch SnackNation’s employee recognition hack – “Crush It Call.”
6. Button | Nemonations
“Nemonations” is Button’s large company-wide recognition for going above and beyond expectations. Each Friday at demos, team members can “nemonate” their deserving colleagues who went the extra mile that week and they pass around a stuffed Nemo (of Disney’s Finding Nemo fame) to the recipients.
7. Typeform | Spontaneous Applause
At Typeform, whenever someone does something noteworthy (however big or small)—anyone can start a round of applause. And the whole office joins in. Most people have no idea why they’re applauding, but the employee receiving the applause does. It creates a friendly and more human environment.
Recommended Article: How to Master the Art of Employee Recognition: 11 Unique Examples In Action!
Employee recognition and rewards acknowledge an employee for their contributions and promote motivation, job satisfaction, self‐esteem, and other positive outcomes.
Here are some key elements of a successful recognition and reward program:
– Timely and specific recognition
– Involvement of top management
– Peer-to-Peer recognition
– Integration of core company values
When providing recognition feedback, this model –
As Soon – Timing is important; don’t delay praise
As Sincere – Do it because you are truly appreciative
As Specific – Give details about the achievement
As Personal – Do in person (or handwritten note)
As Proactive – Do not wait for perfect performance
In this guide, you’ll find the list of BEST employee Rewards and Recognition ideas that will boost employee recognition in your workplace.