Awards and Prizes
What are Awards and Prizes?
In HR and Payroll, awards and prizes are cash and non-cash awards given to employees for:
- Something they have done (recognition)
- Something they might do (incentivization)
Why Are Awards and Prizes Important?
Awards and prizes play a vital role in employee performance and engagement. They can motivate employees to put their best foot forward and stick around for the long haul.
Company cultures rooted in recognition can bring:
- 24 percent improvement in quality
- 27 percent decrease in absenteeism
- 10 percent reduction in tournover
What Are the Best Awards for Employees?
There are three main types of awards that are great options to help your team convey your gratitude and appreciation.
Performance awards are based on an employee’s performance in the workplace. These can acknowledge hard work and efforts for a project or overall work performance.
Some examples of performance awards can be:
- Employee of the Month
- Standout Performer
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Behavior and Value Awards
Behavior and value awards focus on an employee’s good work ethic. Those who display diligence, transparency, and good intent should be recognized, as they contribute professionalism and advocacy to the workplace.
Some common behavior and value awards you may have seen are:
- Best Team Player
- Outstanding Character
- Social Contributor
Service or Tenure Awards
Service and tenure awards illuminate employees who demonstrate loyalty and hard work. They recognize the years of service an individual has contributed and can be a nice way to celebrate their milestones and accomplishments.
How Do You Recognize Staff for Hard Work?
It’s helpful to ask your employees how they would like to be appreciated. While some individuals want to be recognized company-wide, others may prefer something more intimate.
Here are five simple, yet powerful ways to recognize your staff for their hard work:
- Get management involved: 28 percent of employees expressed that their most memorable recognition came from their manager, followed by an executive or CEO (24 percent).
- Give shout-outs: Work with your team to highlight employees in a big group (company meeting) or small group (team meeting).
- Leave a thoughtful note: If a staff member prefers something more private, notes or cards are a thoughtful way to express appreciation.
- Offer money: Bonuses can be a simple way to award and recognize employees. It doesn’t have to be in the form of cash. You can customize money awards based on an employee’s interests. For example, you can give them a gift cards for a restaurant or activity of their choice.
- Offer additional paid time off: Employees who work hard deserve a break. Offering additional PTO recognizes and rewards those employees who could use some time off.
What Motivates People to Work Hard?
Money, recognition, and purpose are key factors that motivate employees. Each plays a vital role in how fulfilled employees feel in their roles. Employers should identify methods that target each factor and incorporate them into their company culture.
What Motivates Employees?
Some benefits that may motivate employees include:
- Employee incentive programs: Project bonuses, merit-based raises, and free vacations are common examples of incentive programs. These programs can help employees stay focused on a goal and inspire them when motivation wanes.
- Leadership and growth opportunities: 94 percent of employees express they would stay longer at a company if it invested in helping them learn and grow. Employers can offer employees a career trajectory that aims to help them gain promotions within the company.
- Flexibility: As employees have personal lives they need to attend to, offering flexible work schedules helps your employees feel cared for, which can boost their motivation.
Are Awards and Prizes Taxed?
Taxation depends on the value of the award or prize and other qualifications. For example, if an employee receives “tangible personal property” as an award, they must exclude its value from their income—-but only if it does not exceed $1,600. If it exceeds that value, employees must include the value difference in their income.