Trends in rewards and recognition are always changing. When the priorities and preferences of employees change, employers need to adjust how they reward and recognise the quality work that employees do. We have compiled a list of the most important global trends in reward and recognition programmes that organisations have been driving in 2019.
Making efforts to reward and recognise employees in a way that is most relevant to them will help to boost employee satisfaction and, in turn, enhance employee well-being, loyalty, and productivity.
Global trends in recognition
WorldatWork’s 2019 report Trends in Employee Recognition contains many important insights into how employees all over the world want to be recognised and rewarded for their work. In this report, recognition is defined as “a gesture to acknowledge, give thanks for or celebrate an event, behavior or result that was observed and/or incentivized.” Let’s take a look at some of the key findings from this research.
Main findings from WorldatWork’s report
- Recognition programmes are still overwhelmingly common in 2019 and company wide
- There is a slight shift away from both formal and informal programmes to strictly formal programmes
- Length-of-service programmes (recognition based on how long an employee’s been at a company) are the most commonly utilised. Also, programmes that could lead to higher ROIs (e.g. error reduction, increased safety, waste minimisation) remain relatively rare
- Nearly all of the recognition programmes analysed have been in place for over five years, which means little change has taken place in this space
- Organisations tend to measure the success of their employee recognition programmes in terms of employee satisfaction rather than external measures
- Most respondents feel that employee recognition programmes are doing a good job of meeting their goals but note there is still room for improvement
The use of recognition has remained relatively stable
For the past 15 years, the use of recognition by organisations has stayed relatively flat. In 2002, 84% of companies utilised recognition, with the figure now standing at 87% in 2019.
The most common types of recognition
WorldatWork’s research highlights that companywide and programmes where managers recognise employees are the most common forms of recognition delivered. 88% of recognition programmes are company and 74% are where managers recognise employees, whereas, in contrast, 58% are programmes where peers recognise peers.
Formal vs. informal recognition
The data also shows that most companies rely on a combination of formal and informal types of recognition to express appreciation for employees’ work and achievements, although more formal programmes are on the rise. Formal refers to a structured recognition programme, while informal denotes a spontaneous gesture of appreciation. In 2005, 19% of companies had a formal recognition programme in place, which, in 2019, rose to 23%.
The number and popularity of recognition programmes used by companies
The average organisation uses eight different recognition programmes. The most popular types of programmes utilised by companies are as follows:
- Length-of-service (72%)
- Above-and-beyond performance (62%)
- Spot (55%)
- Retirement (46%)
- Customer service (34%)
- Company milestones (33%)
- Sales/selling behaviours (28%)
- Productivity (27%)
- Quality (27%)
- Cost-savings (26%)
- Major personal events (25%)
- Biometric/wellness (25%)
- Safety (24%)
- Efficiency (24%)
- Suggestions/ideas (20%)
- Employee onboarding (19%)
- Employee of the month/year (18%)
- Performance improvement (17%)
- Training completion (16%)
- Error reduction (10%)
- Time and attendance (8%)
- Waste/scrap minimisation (7%)
- Customer recovery (6%)
- Inventory control (5%)
- Preventative maintenance (5%)
- Other (3%)
The longest standing recognition programmes
As already cited, most employee recognition programmes have been in place for over five years. And the longest standing programmes are length-of-service (with 89% of such programmes being used by the surveyed companies for over five years) and retirement (87%). Some popular rewards and recognition programmes, such as wellness, are quite young, with 13% of such programmes being in place for less than 12 months, and 58% existing for one to five years.
The aims of employee recognition programmes
In 2019, it is clear that employee recognition programmes have a variety of objectives, both in terms of employee satisfaction and business results. The most common objectives of recognition programmes are as follows:
- Create/maintain a culture of recognition (78%)
- Create/maintain a positive work environment (77%)
- Reinforce desired behaviours (71%)
- Increase employee engagement (71%)
- Support organisational mission/values (69%)
- Motivate high performance (68%)
- Increase retention or decrease employee turnover (60%)
- Increase morale (58%)
- Emphasise organisational values (53%)
- Improve organisational culture (52%)
- Enhance the employee experience (49%)
- Support becoming/remaining an employer of choice (39%)
- Encourage loyalty (36%)
- Improve employee relationships (33%)
- Encourage safe practices (26%)
- Provide line of sight to company goals (26%)
- Support a culture of change (24%)
- Other (4%)
The recognition programmes that reach the most employees
WorldatWork’s research shows that biometric/wellness programmes are the type of recognition programme that reach the highest percentage of the workforce (40% in the last 12 months), whereas the programme reaching the fewest numbers of employees in the past year was employee of the month/year (4%).
Trends in how organisations deliver rewards and recognition
Rewards and recognition based on experiences are increasingly popular
Research has consistently shown that millennial workers prefer experiences to material gifts when being rewarded for their work. And this preference remains the case in 2019, applying to other generations too. Figures have shown that consumers are increasingly spending less money on things for people, and more on experiences. This global trend means that many employees don’t want to receive money or possessions for their hard work and performance; rather, they want to be offered the opportunity to do activities that will bring them joy and memories to cherish.
The reason for this global trend is that people are starting to see that worthwhile experiences are more likely to bring them happiness than material possessions. This is an important point for employers to take note of, as this more reliable way of increasing employee satisfaction through experiential rewards will lead to greater productivity.
Rewards and recognition programmes related to wellness are important to employees
From the perspective of employees, wellness programmes are one of the most beneficial rewards they can receive. Employees are becoming increasingly interested in looking after both their physical and mental health. And this trend is certainly in the interest of employers, too, since if employees are given ample opportunities to boost their wellness, then they will find it easier to be focused, creative, and productive at work, and they are less likely to take days off as a result of sickness or be at work while unwell (known as absenteeism and presenteeism, respectively).
Attractive wellness programmes may include perks such as massage therapy, meditation classes, martial arts classes, fitness classes, yoga and Pilates sessions, and gym memberships. Giving employees opportunities to engage in regular physical activity will help to boost employee well-being. It’s also important for many employees to know that they can receive mental health support whenever it’s needed, so providing therapy and counselling as part of a wellness programme is an effective way of letting employees know that you’re there to support them, whatever their personal struggle may be.
Personal development matters, too
Previous research has revealed that 65% of millennials consider personal development to be the most important factor in their job. Indeed, having opportunities for skill development and career progression is one of the standout global trends in employee recognition and rewards that we see today. Millennial employees are obsessed with self-development. They want to know that their role and the work they do for a company will allow them to grow as a person.
Self-development might include being given the chance to do things not previously done (such as taking on more responsibilities, having more of a leadership role, and giving talks, presentations, and speeches). It can also involve workshops and courses that aim to broaden one’s knowledge, or training sessions to learn new skills or refine existing ones.
Like experiential rewards and wellness programmes, offering training and development opportunities to employees is mutually beneficial. It will provide employees with a sense of meaning and purpose in their work, as well as help a business to flourish.
Employee rewards can help boost employee engagement and business success. Download our free e-book to find out more.