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What are Employee Incentives?

What are Employee Incentives?

By: Content Team

What are Employee Incentives?

Most of us choose to work so we can earn a living or grow our careers. But beyond getting our payslips, what really motivates us to work harder?

 A simple factor that derives this is known as an employee incentive. Most people will work within the realms of their expectations. But some may choose to go further and outperform. To encourage this work ethic, employers reward them through incentives.

 From discount subscriptions to free lunches, there are countless incentives for employees. It all falls on you to decide which ones to offer and whether they’re enough to encourage your staff to work harder.

 Let’s take a look at what an employee initiative is, why they’re important, and what examples you can introduce into your workplace. 


What are employee incentives

Employee incentives are rewards or opportunities presented to individuals for working well.

These individuals are usually recognised for having positive work ethics, attitudes, or output.

For example, they might hit their monthly targets consecutively; or are known for helping out colleagues during difficult times. Whatever they’ve done, their behaviour has caught the eye of their employer. And in a good way, too.

To keep this level of dedication and motivation going, you’ll need to reward them appropriately. That’s where employee incentives come in. They’re great for celebrating individual efforts, as well as collective ones.

Why are employee incentives important?

Businesses will use all kinds of employee incentives for many reasons. For example:

● They encourage other employees to work hard and exceed their own expectations.

They help establish solid teamwork and comradery.

● They encourage a growth in productivity and output at work.

● They boost job satisfaction and retention rates.

● They enable employees to improve their own work skills and experiences.

It’s true that ultimately the benefits of employee incentives fall on the business. Ye, you need to ensure they attract your employees’ interests enough to make them want to work – and work hard. 

For example, you could offer career development opportunities for those aspiring for a promotion. Or you could give out cash vouchers for employees struggling to balance their household costs.

If employees have no interest in your incentives, they’ll feel discouraged to work well. They may even under-perform or seek alternative jobs with better employment benefits. 

Don’t confuse happiness with engagement

Setting yourself a goal to make everyone happy is not an employee engagement strategy. The same applies to hyper-focusing on employee wellbeing or satisfaction.

All of these things will likely play a part in your engagement strategy, but you need to be led by employee feedback and the needs of the business. The goal of your strategy needs to be to create a working environment where employees feel able to realise their full potential, motivated to employ their full range of skills to helping the company achieve its goals and proud when they help to successfully deliver on them.

An engagement strategy may include wellbeing measures like mindfulness sessions or workplace socials, and your desired outcomes may include happier, more satisfied employees.

But happy, satisfied employees are not automatically engaged employees. They may be happy to coast through rather than be proactive and productive. To build engagement and the benefits it brings you need a to build a deep, strong connection to your company specifically across your entire team rather than focusing on individual outcomes.

Most importantly, whatever your employee engagement strategy looks like in practice, it must be genuine and authentic.

A strategy that is designed around the idea of extracting more effort from your workforce will be found out very quickly. The result will be the opposite, as employees disengage and lose trust in your business. Avoid trade-offs or offering rewards in return for effort. If they are appropriate, those benefits should be built into employee contracts as an incentive, not included in your employee engagement plans.

Your employee engagement strategy needs to be built on a real objective to create a positive culture of reward and recognition within your business. Your goal is to create a place where people want to work and feel their efforts are valued.

Focus on that, and the benefits will follow.

Examples of employee incentive ideas you can introduce into your workplace

Businesses will offer all kinds of incentives – from financial rewards to social event opportunities. It all depends on your workplace culture and the interests of your staff.

You can round up incentive ideas for employees into four categories. These include:

Compensatory incentives

Compensatory incentives are based on financial rewards. They’re usually in correlation with the work being done, i.e., earning commission based on sales numbers. When using these incentives, you must budget carefully or else you could be left out of pocket.

 Examples of compensatory incentives include:

      Bonuses: These are considered to be the best employee incentives. Bonuses are never usually frowned upon, so long as they’re fitting with the work being done.

      Promotions: These are more career-specific and will attract those who are interested in career development. Promotions often come with a new title, pay, and benefits.

      Stock shares: These are usually offered to senior employees within a business; or those in specific fields, like sales. Stock shares lead to higher levels of performance, loyalty, and retention. 

Recognition incentives

Recognition incentives revolve around instant gratification. They’re usually presented on-the-spot and can uplift spirits at once. However, these aren’t suitable across the board, as some employees may prefer a more ‘physical’ type of reward.

Examples of recognition incentives include:

      Words of gratitude: This might seem like a small gesture; but words of gratitude can really hit home sometimes. A simple word of thanks or praise during your morning meetings can inspire employees to keep up the good work.

      Awards: These may include things like certificates, medals, and trophies. They’re usually awarded along with acceptance speeches and further celebration.


Reward incentives

Rewards are highlysought after. Employees see these physical incentives as versatile between their professional and personal lives.

Examples of reward incentives include:

      Gift cards and vouchers: These range across all kinds of discounts. Just like bonuses, gift cards and vouchers allow employees to reward themselves in whatever manner they choose.

      Company perks: These often leave other employees green with envy. Company perks can include anything from free lunches to personal parking spots.

      Social event tickets: These are a great way to show an interest in your employees’ interests. From football matches to K-Pop concerts, rewarding tickets for social events allows employees to have an unforgettable night out.

Activity incentives

Another good incentive for employees across the board are activity-based ones. These allow employees to celebrate their achievements alongside their colleagues. They also allow them to socialise or relax, which may be sought after stressful weeks or looming deadlines.

Examples of activity incentives include:

      Company parties: These help employees relax and celebrate achievements on a company-wide basis. They might include attending a swanky evening out; or even just ordering pizza and drinks for the whole office.

      Free lunches: Sticking with food, employees always work better on a full stomach. Free lunches are fun incentives for employees and can really help keep the motivation going.

      ‘Bring your pet to work’ day: Nothing boosts workplace morale better than office pets! Why not allow your employees to bring their pets into work for the day? Just be sure nobody has any life-threatening allergies!

Get expert employee initiatives ideas with

Employers should go above and beyond recognising hard work from their staff. From personal goals to team achievements – you should always celebrate these milestones in the best manner.

Why not use gift card and voucher initiatives to motivate employees? At, we offer a variety of rewards guaranteed to help boost employee morale, loyalty, and engagement.


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