Insights & Articles
Posted on 10 December 2019

Reward Schemes for Employees: Do they really work?

5 minute read

Navigating how to best motivate your employees can be tricky, especially when there’s no ‘one-size-fits-all’ solution. After all, everyone is motivated in a variety of ways, and therefore want to be shown they’re valued in different ways too. One of the ways many businesses are trying to optimise engagement is through reward schemes for employees.

These schemes have increased in popularity over the years, but are organisations fruitlessly throwing money at elaborate strategies that don’t truly pay off? In this article, we’ll look at the advantages and disadvantages of employee reward schemes. Do they really increase productivity and employee retention? Or is there a better way to show your employees you appreciate and value them? Read on to find out!

The pros and cons of reward schemes for employees

These are just like anything else in business. It has the potential for great success or failure. It all depends on the implementation. And in order to implement anything properly, one needs to carry out a proper audit of all the pros and cons so that you can maximise the pros and mitigate the potential cons. So, what are the advantages and disadvantages of an employee rewards programme? Let’s take a look…


A well-implemented employee reward scheme can come with a wealth of benefits for employees and the businesses that employ them. For example:

  • Employees can enjoy monetary rewards like gift vouchers to enjoy outside of work
  • They can be used to incentivise teams to reach targets and goals
  • They can encourage healthy competition between employees, teams and departments
  • They can be useful for recognition long service milestones, helping employees to feel valued for the time they’ve contributed to the business


Of course, while a reward programme can bring benefits, it also comes with caveats. For example:

Incentives shouldn’t be the only reason employees want to work hard and go above and beyond for you and your clientele. Programmes should focus on helping employees feel valued and contribute to your scheme of ongoing personal development, rather than what employees will be rewarded with.

The incentives and rewards offered under many staff rewards schemes can come off as a little impersonal to employees. In order to be truly effective, it needs to show you appreciate that employee as an individual.

They can also become costly, particularly in the long term. If you’re not careful, employees can start to expect bigger rewards and incentives for their hard work, no longer seeing that a job well done is its own reward. And that may well be contrary to the kind of workplace culture you’re trying to create.

An alternative to employee reward schemes: combing recognition with incentives and reward

Many businesses are now shifting away from rewards and towards recognition. After all, not all employees are motivated by baubles and gestures like gift cards. Are they appreciated? Sure. But most employees are motivated more by professional pride than the accrual of goodies.

This is why focused reward schemes for employees is so vital in helping employees to feel valued and remind them that the work they do makes a big difference. Almost 70% of employees feel that they work harder when they feel as though their efforts are appreciated. Appreciation is a powerful tool that can go a long way towards motivating employees to go the extra mile.

When employees are recognised and their achievements are celebrated, it doesn’t just benefit the individual employee — it benefits the organisation as a whole. It creates an opportunity to celebrate the individual’s achievement as a team. More importantly, however, it makes a huge contribution to your workplace culture.

A focus on recognition in your workplace culture can help make working days more positive, ensure that employees are motivated, teams are cohesive and achievements feel genuinely valued. It also improves employee retention — after all, why would employees want to leave a business that genuinely appreciates and values them?

This isn’t just valuable in terms of workplace culture and employee retention. It’s also cost-effective. It costs nothing to send an employee a sincere email of thanks, take them aside to show your appreciation for their work on a certain project, or even stop them to say thank you in the break room.

Using recognition tools to show your appreciation

Of course, implementing this kind of culture of recognition presents its own set of challenges. How do you consistently generate the feel-good factor for employees without an established infrastructure that doesn’t feel like some sort of forced corporate mandate?

Fortunately, there are tools that businesses can implement to create a culture of recognition that is self-perpetuating. For example, there are social platforms that look and feel like the ones employees use in their free time but are designed exclusively for use at work.

These platforms are powerful because they combine the power of recognition with reward and incentive tools to allow managers to drive business performance and engagement. The Rippl platform enables employees to share stories and recognise each other’s achievements, for peer-to-peer recognition. Arguably, this is even more meaningful and valuable for the employee, especially when it comes from a colleague whom they know, like and respect. Of course, employers can also do the same, bringing the achievements of employees to the attention of departments, teams or the organisation as a whole.

Employees can also interact with the posts, liking and commenting on them just like they would with any other social platform. Basically, they have all the value of a social platform from an employee perspective without providing distractions and actively contributing to employee productivity and engagement.

These tools aren’t just for recognition and reward…

You can even use these platforms to provide the whole organisation with company updates that pop up on their social timeline. This creates a feeling of community and removes the hassle of sending out email memos and newsletters that often get left unread.

What’s more, these platforms allow employees to offer feedback and feel as though their voice is heard in real-time. This can be much more effective than standard “suggestion box” models which can make employees feel as though they’re shouting into a void.

Many of these platforms can also allow for the giving of non-monetary rewards to account for the employees who are motivated by factors beyond money and material possessions. Time off or an extra-long lunch break might be more desirable for the employee and more cost-effective for you.

Reward schemes for employees can (and should) be tailored to your business. Of course, these schemes are much more effective when employees have a role in shaping them. Get continual feedback from your teams and ensure that the recognition scheme in place is working for them.

Otherwise… what’s the point?

Choose a recognition scheme that works for your business

Whatever scheme or tools you use, take the time to research them properly and use them to implement a strategy that works for your business. Master this and you’ll have the kind of culture where employees are happy to come to work in the morning.

And this not only means that you’ll never need to worry about employee retention, engagement and productivity… it also means that everyone’s working days will be a lot more pleasant.