An employee performance reward program benefits employees who consistently meet performance expectations and demonstrate certain behaviors. However, it’s not all about gifts, cash and rewards. Why not? Read on to find out!


Having an effective Employee Rewards Program in place can increase employee productivity and performance, and can help generate a positive buzz around your company culture. However, it’s important that your rewards program address both compensation (in whatever form) for your employees, as well as recognition and appreciation of your employees. Usually, when an Employee Rewards Program is ineffective, it is missing one or the other parts of this equation.

As it turns out, incentives (like cash, gift cards, or other “treats) work wonders for reinforcing positive behavior. If you give a weekly cash prize to the employee that captures the most customer email addresses at check-out, you can bet that you’ll see an increase in email captures across the board. However, this type of program is only providing extrinsic motivation – motivation for the reward itself.

Ideally, all employees would work as hard as they can at all times for the benefit of themselves and the company, without the promise of a reward. However, this isn’t always the case. Intrinsic motivation – motivation for internal reasons, like enjoying what you’re doing or finding the challenge itself rewarding – is harder to come by. It usually appears with the great combination of inspiring leadership, engaged and committed employees, and a strong company culture.

A low-cost / high-return part of your Employee Rewards Program should be appreciation and recognition. Sometimes, all it takes to give an employee an extra push of motivation is a word of encouragement from their manager or supervisor. For example, if you’ve noticed an employee putting in extra hours to get a job done, or taking initiative to solve a problem, simply saying, “I’ve noticed [x] behavior, and I want to let you know how much I value your time and energy. It’s really helped us / me achieve [xx].”

In combination with verbal (or written) recognition and praise, be sure to ask employees what types of tangible rewards are important and / or valuable to them. Your team may enjoy 2 free movie tickets, cash, dinner or lunch on “the boss,” or a different type of reward.  If their tangible reward for good performance is something that your employees care about, they are more likely to want to work for it.

Check out this blog article on rewarding employees for good customer service!

See the Hiring & Staffing Guide for more.