Roots of a People-First Culture: Employee Rewards and Recognition

What is Employee Rewards and Recognition?

The Great Resignation of 2021 was incited by increasing employee dissatisfaction and decades of corporate frameworks neglecting their most valuable asset – their workforce. One crucial technique to tackle this situation is to offer “Employee Rewards and Recognition”, thus acknowledging their efforts, without regard to the form. It is to value workers’ deeds and effort. This would help onboarding an employee, as well as increasing retention rate. Apart from enhancing their morale, it also elevates the company’s integrity and work-culture.

In accordance with a survey by Bonusly 46% of the 2,000 American respondents have left a job because they felt unappreciated. Likewise, India faces such decline in employee resignation due to improper implementation of related HR policies, and employee benefits programs.

Despite the respective practice having existed for years, it may not have been tapped into effectively, perhaps, losing out on its potential utilization. Being emotionally viable, a slight gesture or act of appreciation is enough for humans to encourage positive change and reform in their work and functioning. To the employee, it acts as a catalyst for pushing further, ahead into achieving bigger goals.

“Nothing is more effective than sincere, accurate praise, and nothing is more lame than a cookie-cutter compliment,” said Bill Walsh.

Need for Employee Rewards and Recognition

Employees who report receiving recognition and praise within the previous week show increased productivity, get higher scores from customers, and have better safety records. It simply creates a deep-rooted impact in the work-system by building a people-first culture, and thus, value for employee.

For any organisation to sustain and nurture long term growth, it is crucial to hold the employees’ trustworthiness, and feed their dedication to work through deserved appreciation. Therefore, implementing programs like such is a proven strategy to boost productivity, enhance employee engagement, and drive performance. By acknowledging and rewarding performers in accordance with their input and achievements, organizations send out clear messages of positivity. This practice not only encourages employees to stay focused and motivated but also empowers them to set and achieve their goals effectively.

Within the workforce, recognizing and rewarding employees helps

• Align organizational objectives
• Nourish employee satisfaction
• Elate customer experience
• Reinforce values
• Boost motivation.

In today’s fast-paced work environment, employees can easily feel undervalued and unappreciated, leading to disengagement and lagging turnover, which might significantly hinder team morale and overall job satisfaction.

When employees feel appreciated and valued for their contributions, it not only boosts their confidence but also drives higher productivity levels and a stronger commitment to the organization. This, in turn, contributes to employee retention, a key advantage for any organization, and serves as a powerful motivator for sustained performance and success.

Employee rewards and recognition uplifts an organization by:

Enhanced Productivity:

Engaged employees have a higher tendency of showcasing productivity, for recognising and rewarding employees can serve as a powerful motivator, encouraging them to deliver their best work consistently. It has evidently boosted productivity by 70%-80%.

Increased Job Satisfaction:

Acknowledging individual contributions signifies the value of their work within the organization. This recognition reinforces the importance of their efforts and fosters a sense of job satisfaction, leading to a more positive work environment.

Improved Employee Esteem:

A culture of recognition and appreciation contributes to not only employee happiness and motivation, it also builds and uplifts their esteem and dignity. This is a humane practice as well, for it reinforces their worthiness and capability. When employees feel respected and valued, they are more likely to be engaged and motivated to perform at their best, with incremental morale and commitment.

Incremental Retention Rates:

Employee retention is a key advantage of implementing a robust rewards and recognition program. By feedback and reward to employees for contributions, organizations can increase employee loyalty and reduce turnover rates. It has proven to reduce turnover by 50%. Retaining skilled employees not only saves time and resources spent on recruitment and training but also fosters a stable and experienced workforce.

Rewards and recognition are often interchangeably, despite their distinctiveness

1. Rewards are measurable and typically entail monetary value, whereas recognition carries emotional value.
2. Rewards are measurable in units and thus considered tangible, while recognition cannot be measured in such a manner, therefore intangible.
3. Rewards are typically linked to achieving specific goals, whereas recognition can occur spontaneously and more frequently without a set schedule.

Types of Rewards and Recognition for Employees:

A. Types of Employee Rewards-

1. Monetary Rewards:

• Bonuses: Additional income exclusive of salary paid, for achieving company goals.
• Incentives: Paid for meeting weekly, monthly, or quarterly targets.
• Commissions: Certain Percentage of sales is added  for salespersons.
• Increased Hourly Pay: Additional pay for non-salaried employees.
• Seniority-Based Pay: Increment based on tenure.
• Other Employee Benefits: Indirect compensation like health insurance, paid leaves, etc.

2. Non-Monetary Rewards:

• Enhanced Training Facilities
• Accommodations such as Snacks and Beverages
• Comfortable office or workspace
• Resource and Equipment

3. Extrinsic Rewards:

• Motivator Rewards: Personalized rewards aligned with employees’ interests.
• Awards: Recognition for exceptional performance.
• Vacation: Time off for overworked employees.

4. Intrinsic Rewards:

• Internal Satisfaction: Job satisfaction and positive work environment.
• Healthy Work Culture: Non-toxic environment and supportive colleagues.

5. Non-Traditional Rewards:

• Flexible Working Hours: Adjusted schedules based on employee needs.
• Reduced Working Days: Four-day work weeks with longer hours.
• Work From Home: Increased flexibility, especially post-COVID19.

B. Types of Employee Recognition:

1. Formal Recognition:

• Structured programs with formal procedures and awards ceremonies.

2. Informal Recognition:

• Spontaneous appreciation events like parties or meals for team achievements.

3. Micro Recognition:

• Immediate feedback and acknowledgment for small achievements.

4. Peer to Peer Recognition:

• Colleagues recognizing each other’s contributions informally.

Tips to effectively implement Employee Rewards and Recognition Plan:

• Vision Clarity: Align recognition programs with company goals.
• Community Building: Foster teamwork and understanding among employees.
• Attribute Knowledge: Recognise and reward achievements promptly and visibly.
• Defined Expectations: Establish clear criteria for rewards and recognition.
• Employee Feedback: Solicit employee input for creative and effective recognition ideas.
• Impact Assessment: Measure the program’s effectiveness on morale, retention, and productivity.

Few of the best practices in Rewards and Recognition:

• Sponsored Online Courses: Employers pay for or subsidize the cost of online courses and educational programs.
• Meal Subscriptions: Provision of meal subscription services.
• Personalized Items: Customised gifts, and items tailored as per employees’ preferences.
• Gift Cards and Incentives: Vouchers and similar cards.
• Performance-Based Recognition: Directly links rewards to achievements, by rewarding on performance target basis.

Possible Criteria:

• Years of service: Based on the length of their tenure with respective organization.
• Strong individual or team performance: Based on exceptional performance and achievements.
• Systems improvement: Meant for employees who contribute to improving internal processes and functions.
• Client growth or retention: Provided to employees for acquiring new clients or retaining existing ones.
• Personal development: Employees who invest in their personal and professional development, and skill building.
• Actions that embody your organization’s values: Recognizing employees who demonstrate behaviors and actions that align with the company’s core values.
• Technological advances: For those who contribute to the adoption, development, or improvement of technology within organisation.

Conclusion:

This practice has been in the work culture for years. To understand the grounds of its utilisation is a need for the Human Resources Department. There are several policies and programs that may be implemented to put this practice to the best use, and thus create a positive and groomed environment around the workspace.

Tailored policy templates, and best practice guides have been curated and made accessible at the HR Toolkit of 9Toolkit.in, with sole purpose to help startups in formulating the foundation of respective HR practices. Standard Operating Procedures (SOPs) and guides for HR practices involves outlining clear and consistent steps for various HR functionalities. Thus, to ease one’s job of customising policies about “Employee Rewards and Recognition” from scratch, we have availed various plans ensuring that “all your HR documents are consistent and compliant with current laws and regulations”; catering to a wide audience of students, professionals, as well as startups at distinct stages of expansion.