If you are searching Google for “rewards for employees to motivate” or “types of employee rewards”, you are going to love this article! We put together the most detailed list of types of employee rewards to motivate your employees.
Types Of Employee Rewards
Here we describe the many different types of employee rewards including intrinsic, extrinsic, financial, non-financial rewards and more.
Intrinsic Rewards (Self Given Rewards)
The satisfaction from a job are considered intrinsic rewards. These are self-initiated rewards, such as feelings of accomplishments, being part of a team, or having pride in your work. These techniques of job enrichment, job rotations, flex time, and shorter weeks can actually offer intrinsic rewards by providing challenging and interesting jobs and allowing the employee more freedom.
If the employee experiences personal growth or feelings of achievement from a job, the rewards will be labeled as intrinsic.
Extrinsic Rewards (Promotions, Money, Bonuses, Fridge Rewards)
Promotions, money, fringe benefits (benefits in additional to normal salary) are going to be extrinsic rewards. These are rewards that are external and come from outside sources, which is mainly the management.
If an employee receives a write up in the company magazine or a salary increase, those rewards will be labeled extrinsic.
Financial Rewards (Paid Vacations, Sick Leave, 401k)
Rewards may also enhance the financial well-being of the employee. If they do it could be through profit sharing, wages, or bonuses, or indirectly such as paid vacations, paid sick leave, purchase discounts, and pension plans.
Non-Financial Rewards (Makes Employees Lives Better)
A non-financial reward is potentially at the discretion of the company. They do not increase the financial position of the employee, but make the life better at the job, and non-financial rewards make job life better.
There is a saying that one mans food is another mans poison which applies to rewards as well, but especially in the area of non-financial rewards. What an employee finds as something they have wanted, another may find it isn’t. Therefore, you must take care in providing the right type of non-financial reward to each employee, yet when the selection has done carefully, the benefits are impressive.
There are some employees who are status conscious. A carpeted floor, attractive office, large desk, or private bathroom may be the thing to stimulate an employee to an impressive job title, such as their own secretary, business cards, or a well located parking space with their name on the reserved sign.
Types Of Non-Financial Rewards
- High Five
- Thank You
- Let Them Know How You Feel
- Personal Time Away From Office
- Give Them A Hug
- Let Them Know You Care
- Sticky Notes
- Reserved parking space
Performance Based Rewards
The rewards that a company gives can be based on membership or performance criteria. While many managers will argue that their rewards pay for performance, you need to realize that this is not always the case. Few companies will reward their employees based on performance. Although, without question the main basis for rewards is the membership.
Performance based rewards are show by piecework pay plans, group bonuses, incentive systems, commission, or other merit pay plans.
Membership Based Rewards
But membership based rewards may include profit sharing, salary increases, benefits, and cost of living increases that are based on the labor market, credentials, seniority or rank, or future potential.
The line between the two are not that oblivious. For example, a company paid membership at a country club or use of company vehicles by executives may have a membership for performance. If it is available to middle and upper level employees, then they are membership based. Although, if they are only made available for certain managers based on performance instead of membership, which implies they can be taken, are considered performance based rewards for those who might like them.
Membership Based VS Performance Based
Membership based rewards should be broken into two groups. One is made up of services and benefits that will go to an employee regardless of performance. Take for instance, nurses at a certain hospital will get 10 day vacation, sick leave, and $200,000 worth of life insurance as well as paid hospitalization coverage and other services and benefits no matter if they do a great job or an acceptable one. Due to the services and benefits are based on membership, they are membership based rewards. Other rewards will be thrown into a group called implied rewards. You may wonder why there are two groups.
They have been separated to clarify what can be confusing. Many companies will treat services and benefits as membership based rewards. All other rewards are considered performance rewards. This is both misleading and incorrect labeling. Performance is just a small determinant for rewards. This is true despite theories stating that high motivation actually depends on performance rewards. When it comes to practice, most lip service is given for good job performance, but those companies rewards do not run with employee performance.
Types Of Rewards Depend On Who Their Coming From
- Rewards From Group To Individual Manager, CEO, Boss
- Rewards From Group To Individual Employees, Staff, Workers
- Rewards From Boss To Employee (Top-Down Recognition)
- Rewards From Employee To Employee (Peer-to-Peer Recognition)
- Rewards From Self
About PromoGroup Rewards
Since 1970, PromoGroup has been creating customer loyalty and employee reward programs and employee gift certificate programs for a variety of satisfied clients. Our PromoGroup Rewards brand specializes in gift certificate and gift card programs that will help you drive measurable results. We can help you with employee motivation, consumer engagement, brand awareness, and much more!