Employee recognition in front of team

Employee Recognition Scheme: Expert Tips & Best Practices

Performance Management
March 2, 2022
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What does your organisation do to ensure that employees are showing up motivated and excited to be at work? Employee recognition programmes are often implemented to achieve these goals. 

When employees feel valued, they are more likely to remain engaged and self-motivated to do their best. These feelings of satisfaction lead to reduced employee absenteeism, and ultimately, reduced staff turnover. 

But, how do you devise and implement an employee recognition scheme? And, what makes a programme successful or not?  

In this article, we will answer all of these questions and more. We will also take a look at the connection between employee recognition, motivation, and employee wellbeing. This way, you can equip your organisation with all the best tools to motivate and engage your workforce.

What is Employee Reward and Recognition?

The goal of reward and recognition  is so that a company can acknowledge and show appreciation for an employee’s hard work. By doing so, the positive behaviours are noted and reinforced so that employees continue to do their best and are aligned with achieving the business goals. 

Rewards are typically gifts and awards, whereas an employee recognition scheme is usually praise. In this sense, a reward tends to be tangible or monetary, and recognition is intangible. An employee recognition scheme should not be a replacement to one’s salary or benefits, but instead should be in addition to these aspects of the job.

Why are Employee Rewards Schemes Important?

If you put in time and energy to get someone a gift that they wanted and they don’t say thank you, how would you feel? Chances are you’ll feel dejected and unmotivated to care too much about going out of your way for them in the future. 

The same goes for employees within organisations. When employees do their job and do it well, it only makes sense to pay attention and recognise the job well done. All too often, managers and business leaders are so focused on the big picture that they forget about the people making the dream come to fruition. 

By acknowledging your team with a reward and recognition scheme, you are helping to boost and support their motivation. But, rewards and recognition can only go so far when it comes to motivation levels. 

Once an employee reaches a certain level of recognition or rewards, it eventually results in diminishing returns as in each subsequent reward or recognition may have a lessened effect. 

That’s why it’s so important to focus on employees’ mental wellbeing because ultimately, it’s always going to be the main factor in one’s own levels of motivation and satisfaction. 

An employee wellbeing tool provides your organisation and people with what they need to feel supported. The technology can work hand-in-hand to complement an employee recognition scheme as it provides insights into how your team members are feeling and what affects their mood.

The right wellbeing platform provides employees with an understanding of their own mental wellbeing, along with the the tools and techniques they may need to better support themselves. By supporting their own mental wellbeing, employees can work to increase their motivation and satisfaction levels in the workplace.

Why Recognise Your Team?

Your business depends on the people who do their jobs day in and day out. So, any business’ priority should be to take care of its people as best as possible. By initiating recognition, employees feel valued. 

In turn, employee recognition and reward schemes can help to increase motivation, lower employee absenteeism, decrease stress levels, and increase job satisfaction. 

A happier workforce that feels supported is more likely to care about their contribution to the company. Oftentimes, the best type of support comes in the form of supporting one’s mental health. 

What are Examples of Employee Recognition?

Let’s take a look at some examples of employee recognition: 

  • Thank You: Just two words can go a long way. Simply saying “thank you” to an employee who is showing effort to complete their work’s responsibilities can make all the difference. And, it literally costs nothing to do. This immediate form of recognition and gratitude is likely to make the recipient smile and feel valued. 
  • Awards: At whatever frequency you choose to host or share awards, awards are a great way to display appreciation. You can even get employees involved in voting for one another.

  • Email Newsletters: If your company already sends out newsletters, you can easily drop in a section that highlights individual or team success. It’s a great way to promote a sense of camaraderie within the organisation and keep everyone aware of what other departments are working on.

  • Service Acknowledgement: Long-service awards are granted to employees who have remained loyal within the business and can be given as a thank you for the employee’s dedication. It could be something as simple as a meal out, an engraved plaque, or a medal.

  • Employee of the Month: An oldie but goodie, the employee of the month recognition is a good idea because it allows for a new employee to be recognised within an expected frequency (monthly, of course). It’s also a way to somewhat gamify the experience of work as employees look to achieve the title of employee of the month. 

How Should Employee Rewards Schemes be Implemented?

To get the most out of employee rewards schemes, there are some considerations that need to be accounted for during implementation. 

These include:

  • Aligning the rewards schemes with the goals of the business. This entails clearly defining expectations and communicating what type of performances will be rewarded and how. 
  • Spontaneous recognition can still be part of the scheme, and it actually is beneficial to be spontaneous about it sometimes, too. This is because it can come off as more genuine when recognition is given on the spot and out of the blue, rather than prescribed. 
  • Rewards must be fair and unbiased. If they seem biased to some members of the group, then it can backfire as the other group members will feel deflated and unmotivated. 

How to Judge Employee Reward Scheme Success?

So, how do you know if your employee reward scheme and employee recognition scheme are working? 

Like most things in business that need to be monitored or evaluated, data proves to be key. You can run employee opinion surveys to learn more about how your employees view the reward and recognition scheme. 

Other metrics to gauge the success of your employee reward scheme include:

  • Employee attrition rates 
  • Staffing level (ratio of employees in staff plan vs. actuals)
  • Employee satisfaction levels (as deduced by employee surveys)
  • Average tenure within a job (the period of time in which an employee stays within the company)

Are Employee Reward Schemes Good Value?

Recognition will cost nothing, but remember, rewards are often financial. To get a grip on what’s going to provide you with positive ROI, it’s helpful to note that the average spend on reward and recognition schemes is about 1-2% of payroll. 

If you’re within that range and see that your staff is motivated and engaged, then keep on going! If something is awry, then it’s time to take a step back and troubleshoot to improve the scheme. 

While it’s challenging to directly assess the ROI of recognition programmes since they vary so much, it is possible to understand their value by looking at the impact of employee engagement on productivity. According to Penguins, disengaged employees can cost the UK an average of £52-70 billion in lost productivity. 

What are Employee Reward Scheme Best Practices?

Keep in mind these best practices when you are initiating and executing any reward scheme:

  • Define clear objectives and criteria 
  • Mix it up by offering a multifaceted rewards and recognition programme (pro tip: it’s not just about financial incentives. Your team likely wants praise, too, so mix and match) 
  • Let employees choose their own reward types by asking them what they’d want 
  • Measure the programme’s effectiveness. A few ideas for measurement may include: interview, feedback sessions, pulse surveys, or performance management software. 


Here’s how to put these best practices into action: 

1. Avoid Recognition Schemes Magnifying Existing Bias

Beware of any bias that is already subconsciously lurking within your organisation when you implement a reward and recognition scheme. You know the saying, “out of sight, out of mind.” Well, don’t let this be the case when you devise these schemes because your part-time, work from home, and flexible schedule employees deserve recognition, too. 

Although it’s likely not on purpose, visibility often plays a key role in these schemes, so you have to remember to reward and recognise those employees who are not always physically in front of you. 

2. Look at the Context of Recognition

When it comes to recognition, the context surrounding the positive behaviour should be addressed and understood, too.  

For example, if an employee exceeds sales goals, but it’s because they never took a day off and worked outside of their regular work hours, is that really something you want to reward and promote? 

Probably not because that type of behaviour leads to burnout, stress, and exhaustion. To avoid promoting these behaviours, devise a R&R scheme that is mindful of rewarding the right behaviours and their surrounding context.

Image Source: Unsplash

3. Embrace Recognition’s Social Side

There’s also a social side to recognition programmes that should be fostered and nurtured. Humans are social animals that like to be part of a group. So, within an organisation, there are ways to build recognition programmes around this notion. 

For example, when teams have strong social links, they should be positioned together to achieve organisational goals. If there are weak links within the organisation or team members, rewards and recognition schemes can be used to strengthen those ties as everyone is aligned to achieve the same goal and work together to do so. 

4. Align Recognition with Business Objectives

Recognition should be applied in cases where business objectives are being achieved. This alignment is what works to keep everybody moving in the right direction. 

Recognition schemes will highlight both the upsides and downsides of what’s happening with an organisation, much like how a mirror will reflect whatever is standing in front of it. To explain, rewards are set up so that employees work to achieve overall goals. But, if something is missing or employees are not meeting goals, it could be a signal that there’s a bottleneck or issue within the organisation. So, depending on how you look at rewards and recognition, they could depict the upsides or downsides that a business is facing. 

5. Involve Your Team 

It also helps  to involve your team in these schemes by way of peer-to-peer recognition. To showcase how this could work: you could ask employees to vote for their peer who is demonstrating a company value strongly by way of their work. 

A Little R&R Goes a Long Way 

We’re talking about rewards and recognition (although rest and relaxation are also needed)! An employee recognition scheme is a way to showcase your appreciation and acknowledgement for the people who are reaching their potential and working towards achieving business goals. 

Rewards are a great way to ensure that your team members feel valued. And, when they feel valued, they are more likely to be engaged and motivated to do their best. 

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