How to Create an Employee Recognition Program Your Employees Will Actually Enjoy

Employee recognition programs might seem like a “nice to have,” but there’s a very good reason to consider implementing one: Organizations with formal recognition programs have 31% less voluntary turnover than organizations that don't have any program at all. Recognition is a human need; we all want to feel valued for our hard work and contributions. Companies that recognize the achievements of their employees inspire a sense of pride, loyalty, and teamwork. 

Recognition also improves employee engagement. Employees who believe they will be recognized are 2.7x more likely to be highly engaged, according to Quantum Workplace research. Employees who are engaged at work are more productive and deliver better work, making recognition programs a true win-win for companies.

Employee recognition comes in different forms. We typically think of an employee being recognized by their manager, but recognition can also come from other peers or even anonymously. It can also come from customers (a great idea for employees who work in a customer support role). You can center your recognition program around achievements, tenure, or company values. The options are endless, but many employers struggle with engagement rates, whether it’s because of a poor program structure or rewards that are just not that exciting to employees. 

Here are a few ways to craft an engaging employee recognition program your employees will actually enjoy. 

Establish a structured program and regular cadence 

Recognition programs should be clearly defined, and employees should understand the metrics or achievements they will be evaluated for. You can use a performance management software system to track if employees are meeting certain milestones and remind managers to recognize them. 

At Automox, their perks program was designed as a way for managers to say thank you to their employees. They established a $200 monthly culture award based on five different company values for employees. 

It's also critical that employees are recognized according to their personal preferences. Managers should have frank conversations with employees and ask how they like to be recognized for their work.  

Offer flexible monetary rewards

When companies spend 1% or more of payroll on recognition, 85% notice a positive impact on engagement, according to an SHRM-Globoforce survey. There are a few ways to provide monetary rewards. 

Many companies opt for two options: gift cards or spot bonuses added to an employee’s paycheck. The problem with gift cards is that it’s hard to adopt a personalized approach. Even if employees have a catalog of vendors to choose from, there’s always the chance that they would rather spend the money elsewhere. 

While spot bonuses provide much more freedom in how employees can spend the money, they don’t always feel as rewarding. If it’s tacked onto a paycheck, employees might feel obligated to put the extra money toward bills, household needs, or debt repayment. Even though a bonus is always wonderful and often necessary, employees rarely use it to truly treat themselves. They may not even notice the extra money before it’s spent. 

Another option is rewarding employees with a pre-funded card like Benepass. It’s a much more “special” avenue for recognition that inspires employees to spend the funds on something they might not normally buy with their own money. You can define pillars of spending such as wellness or professional development, or you can give employees the freedom to purchase anything they like, whether that is a bill or something more fun like a new video game. Either way, flexibility is a core element of the program. 

“Employees prefer to have money added to Benepass because it’s permission to spend it on something that isn’t utilities or groceries,” said Elspeth Arnold, Manager, People Experience at Automox. “They can spend it on something for themselves.” 

Get creative 

Employee recognition can also come in many forms that are not monetary including sending a company-wide email, hosting an employee spotlight on a regular meeting, celebrating personal milestones for employees in a company newsletter, or even celebratory happy hours. 

Keep in mind that recognition needs to be core to your company culture for a program to be successful. If recognition is limited to a once-a-month initiative, the program might feel hollow and out of touch with employees’ daily reality.  

“While monetary investment is also important, the research found it had a more positive impact when recognition was core to the organization’s talent strategy,” said Tanya Mulvey, SHRM researcher.

Ensure that your organization encourages recognition even outside of the parameters of a structured program. Simple measures like shoutouts on Slack or during team meetings help create a culture of ongoing recognition. 

A well-structured recognition program that takes into account employee personal preferences and feedback will serve you for years to come. If you have any questions about building a flexible employee rewards and recognition program, please reach out to sales@getbenepass.com.