Employee Recognition: How to Set Up a Reward Program

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A supervisor congratulates an employee for driving a project to completion.


Building an engaged, committed workforce not only allows organizations to attract and retain top talent but is pivotal to their functioning and bottom lines. According to recent data from Gallup, employee engagement leads to greater productivity, fewer accidents and an increase in profitability of 21%.

As such, many organizations recognize the importance of creating work environments that both fuel creativity and foster job satisfaction.

Employee recognition plays a vital role in making organizations places where individuals feel inspired, valued and meaningfully connected. Employee recognition — the public acknowledgment of people’s accomplishments and hard work — energizes individuals, cultivates an inclusive, humane workplace and helps create a thriving corporate culture.

What does it take to develop, implement and oversee successful employee recognition programs? With proper planning and innovative ideas, human resources (HR) leaders can set up rewards programs that add value to their organizations and provide many other benefits.

5 Effective Employee Recognition Ideas

Organizations can demonstrate appreciation for their employees in various ways. They can both distribute tangible rewards and express gratitude through activities that recognize achievements. Regardless of how organizations show appreciation, HR leaders must align rewards with employees’ interests. Consider the following employee recognition ideas.

1. Give Gifts and Experiential Rewards

Thoughtful gifts make an impact. Items such as gift cards to an employee’s favorite coffee spot, restaurant, movie theater or even grocery store are good options. However, employees may also appreciate items that help them do their work with more ease or convenience. For example:

  • Noise-canceling headphones for employees who work in open office layouts
  • Orthopedic seat cushions with lumbar support for employees who spend long hours at their desks

Other unique gift ideas include the following:

  • Travel accessories for employees who travel
  • Insulated food containers and thermoses for employees who bring their lunch to work

Experiential rewards can also add a spark to employee recognition programs. Experiential awards often leave lasting positive memories, which employees may value even more than material items. Some experiential awards are:

  • Kayaking or white water rafting trip
  • Spa experience
  • Gourmet cooking class
  • Winery or brewery tour
  • Music, theater or sporting event

2. Cater Lunches to Recognize Group Achievements

Catered lunches that recognize group achievements can be excellent rewards for teams that have dedicated time and effort to complete important projects. Organizations can surprise employees with such lunches or let them know ahead of time.

Catered lunches not only boost morale but also build feelings of unity. Sharing meals with colleagues and supervisors allows employees to connect in different ways. This can strengthen bonds and friendships, as well as enhance the feeling that the employees belong to a team.

While sharing a meal, employees can reflect on and celebrate the journey they took together to achieve their goals. It also gives organizational leaders a chance to interact with their teams in a more relaxed environment and reinforce company values of collaboration and appreciation.

3. Use Social Media to Publicly Recognize Employee Achievements

Social media can be a valuable tool for publicly recognizing employee achievements. A company’s social media platforms, whether it’s Facebook, Instagram, Twitter or another platform, allow it to showcase employee success, publicly validating the hard work and innovation. The structure of social media also creates a convenient space for peer-to-peer acknowledgment.

By tagging a post that celebrates an employee’s accomplishments, an organization helps ensure that the recognition reaches the honoree’s colleagues, families and friends.

4. Award Bonus Vacation Time or Paid Time Off

For major accomplishments, such as landing a significant client, organizations can award employees with coveted bonus vacation days or paid time off. Extra vacation time can greatly boost employee morale. It can also give driven employees the chance to refresh themselves and return to work more productive and inspired.

5. Organize a Staff Appreciation Outing

Staff appreciation outings incentivize and motivate employees to keep striving toward company goals. These outings can also encourage communication and relationship building, giving employees a chance to unwind and relax. Some ideas for staff appreciation outings are:

  • Outdoor trips to natural places, such as beaches, lakeshores, mountains and parks
  • Group trips to local tourist attractions, such as amusement parks, aquariums and museums
  • Group trips to comedy shows and karaoke sessions

Steps to Build Employee Recognition Programs

Meaningful employee recognition programs share several important characteristics. They offer timely rewards and acknowledgment and frequently recognize contributions (giving specific praise well beyond “nice work”). Additionally, they publicly commend employees for accomplishments aligned with company values.

HR leaders need to take key steps to build successful employee recognition programs.

Gauge Employee Interests

Effective employee recognition programs tap into the interests and tastes of employees. Token gifts that employees have no use for or activities that employees would rather not participate in don’t get the job done. As such, employee recognition program organizers must communicate with employees to gauge their interests.

In this way, program organizers can better customize the outings they plan and the gifts they give. Such personalization makes employee recognition more likely to resonate. For example, while public acknowledgment may elate some employees, others may prefer private meetings with supervisors.

Create Committees

Employee recognition programs need committees to succeed. Committees can brainstorm employee recognition ideas based on employee surveys. They can also track employee achievements and milestones, as well as determine the types of behaviors and milestones to recognize.

Involve the Leadership Team

While an HR department plays an essential role in employee recognition programs, program managers must involve organizational leaders. Employees need to receive recognition from their direct supervisors and the people they work with for the rewards and acknowledgment to feel genuine.

As a result, employee recognition programs must coordinate with leaders, making sure they take an active part in the process.

Integrate Employee Recognition with Other Incentive-Driven Work Programs

After getting input from employees about the most appropriate types of recognition, creating committees to develop a plan and involving management, HR professionals can consider ways to integrate employee recognition with other incentive-driven work programs.

For example, HR professionals can join health and wellness initiatives with employee recognition, acknowledging success in those sister programs as well. This integration can improve employee engagement on several fronts.

Tracking Employee Recognition

Today, employers can use many software programs to build and track different forms of employee recognition. The software allows administrators to set standards for recognition and keep track of employees’ progress in areas such as content creation and sales performance.

Some capabilities of these software programs are:

  • Measuring metrics to identify employees who warrant recognition
  • Allowing administrators to create timelines and qualifications for recognition
  • Automatically assessing winners and informing administrators

What Are Some Reasons for Employee Recognition Programs?

Organizations need to choose what types of behaviors or accomplishments they want to reward. The choices may focus on employee growth and development or emphasize excellence.

For example, a company that wants to encourage collaboration across departments may offer special incentives to employees who reach specific collaborative goals. Or, a company may reward a team that has a history of being late for hitting all its deadlines.

Examples of When Employers Recognize Employees

Just as the types of recognition vary, so can the reasons for them.

Years of Service

Thoughtful awards for years of service nurture a sense of belonging and honor the contributions that employees have made over time. According to data from O.C. Tanner, 58% of employees at companies with programs that recognize years of service strongly believe that their employers care; only 39% of employees in companies without such programs feel the same way.

Completion of a Project

Meeting deadlines, staying on budget and overcoming roadblocks factor into the successful completion of a project. All the hard work is an excellent reason to say thank you to employees.

Contributions to Organizational Culture

Employees who communicate well, respond to and give meaningful feedback, and are team players contribute to a healthy work environment. These and other contributions to organizational culture play a significant role in an organization’s success and therefore deserve celebration.

Work Outside the Office That Aligns with Organizational Values

Employers can also recognize what employees do outside the office, such as charity or volunteer work, that embraces organizational values. An employee’s commitment to community causes gives employers another opportunity to show their appreciation as such work also reflects well on an employer.

More Potential Employee Recognition Options

Trends like cloud computing and telecommuting have created more options for employee recognition. Cloud-based recognition platforms offer rewards for telecommuters and recognition from peers and supervisors in other locations.

For example, some cloud-based recognition platforms allow employees to give a digital “high five”; employees can praise coworkers on a board everyone sees. Other features include gamified badges employees earn and point systems that accumulate in digital wallets employees can use to redeem rewards, such as gift cards.

How Employee Recognition Adds Value to an Employee’s Work

Employee recognition adds value to an employee’s work in different ways. When employers acknowledge the success of a project or the effectiveness of a team, they draw attention to their employees’ worth. It suggests that employees may be worth more than others may have realized. This matters to employees because it makes them feel more secure in their positions.

Additionally, employee recognition allows employers to communicate what they consider to be standards of excellence. It also helps them set specific performance standards for positions.

Why Employee Recognition Matters

Organizations and employees can point to numerous reasons why employee recognition matters. Everyone wants validation. When people feel appreciated for who they are and organizations recognize them for their accomplishments, everyone benefits. Employees feel more connected and motivated, and organizations function more cohesively.

Consider the benefits of showing appreciation and recognition for employees.

Employee Recognition Fosters Loyalty

Employees who feel recognized and appreciated tend to take greater ownership and pride in their work, translating into loyalty to their organizations. Recognition results in employees investing more of themselves into what they do.

Loyalty not only boosts engagement but also makes it less likely employees will seek work elsewhere. With lower turnover, staff morale often increases. All these combined factors deepen the emotional bonds employees feel toward their organizations.

Employee Recognition Cultivates Happiness

Loyalty and happiness go hand in hand. Employee recognition fosters loyalty for the same reasons that it cultivates happiness. Recognition and appreciation communicate respect. Employees who feel respected often feel a greater sense of purpose, which makes them happier.

Additionally, recognition allows people to feel mastery over their jobs. This builds confidence and a sense of belonging.

Employee Recognition Increases Job Satisfaction

According to a survey from The Conference Board, almost half of U.S. employees don’t feel satisfied with their jobs. This poses a huge risk to companies as regards retaining talent and maintaining high levels of engagement and motivation.

Employee recognition offers an excellent remedy to low job satisfaction. Valuing employees and demonstrating that sends a reaffirming message. It lets employees know their work matters, likely making them feel more satisfied in their positions.

Organizational Benefits of Employee Recognition

Employee recognition also delivers benefits to the organization. It’s worth noting the correlation between happy employees and increased production. This can translate to an improved culture and higher profitability as well.

According to research from the Brandon Hall Group, organizations with robust employee recognition programs are also 41% more likely to achieve greater retention. Greater retention creates huge cost savings for organizations as regards recruiting, hiring and training.

Building an Effective Workforce

Thoughtful employee recognition programs help create thriving organizational cultures that boast high productivity, excellent retention and elevated morale. Building an effective, loyal workforce with job satisfaction requires insight into human behavior and a superior understanding of psychology and management.

Rider University’s organizational psychology degree program offers courses such as Employee Compensation Systems and Employee Engagement that develop the skills and insights needed to build successful employee recognition programs.

Explore how Rider University’s online bachelor’s in organizational psychology prepares graduates to succeed in various organizational psychology careers.


Recommended Readings

Conflict Resolution in the Workplace: Techniques and Strategies

How to Measure Employee Engagement and Satisfaction

Pros and Cons of Pay Transparency in the Workplace



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Gallup, “Employee Engagement on the Rise in the U.S.”

G2, Best Employee Recognition Software

Harvard Business Review, “Why Employees Need Both Recognition and Appreciation”

Human Resources Today, “How to Build an Employee Recognition Program”

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