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Unhappy workers cost U.S. businesses an estimated $1.9 billion annually. The good news is that a well-designed employee rewards program can help turn that around. You might picture rewards as simple perks, like bonuses or gift cards. In reality, it’s about creating a workplace where people feel valued and motivated through supportive practices, such as growth opportunities and meaningful recognition.
In this guide, we’ll explore how to reward employees and why it matters for business success.
Understanding employee rewards programs
Employee reward programs are a way for companies to recognize hard work and let people know they’re valued. These programs can include financial incentives, like bonuses and profit sharing, as well as non-monetary perks, including wellness benefits and extra time off. At their core, they exist to make employees feel appreciated, motivated, and connected to the success of the business. A supportive workplace often means individuals are more productive and likely to stick to long-term goals.
The importance of employee recognition programs: 4 benefits
Showing appreciation for workers has a measurable impact on both people and business outcomes. Here are four of the biggest benefits of employee recognition programs.
1. Attract top talent
A strong rewards system helps a company stand out in the job market because, now more than ever, candidates look beyond salary. They want to join an organization that will recognize their effort, support their growth, and respect their balance between work and life. When leaders highlight these perks during hiring, it shows applicants that the company is committed to people, not just filling roles. This reassurance builds credibility and makes the organization more attractive to job seekers.
For businesses, it means a larger pool of qualified applicants and faster hiring. For employees, it shows them that their work is valued and their careers are supported.
2. Increase productivity
When leaders regularly recognize employee contributions, it sends a clear message that their work matters. That recognition keeps teams focused by making it clear that actions like meeting deadlines, improving processes, and delivering stronger customer experiences can lead to real results. It also creates a sense of accountability that pushes people to maintain that high performance. As a result, employees bring greater focus and energy to their work.
For businesses, this leads to higher efficiency and a culture where teams go the extra mile. For employees, it means taking pride in their work and having a sense of purpose behind their everyday responsibilities.
3. Reduce turnover rate
High turnover takes a toll on both budgets and morale. Replacing even one employee can cost the company up to twice their salary. One way to lower that risk is to create rewards programs with real intention. When employers offer perks people genuinely want, like extra time off and wellness stipends, it shows they care about people’s lives, not just their work. That kind of support makes people feel appreciated and motivated to stay.
For example, maybe an employee wants to grow their project management skills. Instead of leaving for a job that covers certification costs, they get the training and study time through your company. That investment gives them confidence in their future and makes them far less likely to jump ship.
4. Strengthen company culture.
Recognition has a ripple effect across the organization, shaping how people feel and how they work together. When employers consistently call out positive behaviors, they set the tone for the entire workplace. Teamwork flows more easily when people know their contributions won’t be overlooked. They also feel more comfortable sharing ideas and supporting each other, creating a culture where innovation comes more naturally.
3 employee reward program ideas
Reward programs come in many forms, and the right mix depends on your workforce and business goals. Below are three employee reward examples and how they can make an impact.
1. Monetary rewards
Monetary rewards give employees a clear financial thank-you for their contributions. They can come in the form of bonuses, profit sharing, and spot awards that tie pay directly to performance. A sales team, for example, may get quarterly bonuses when they beat revenue goals. For employees, monetary rewards are immediate proof that their hard work pays off. Employers benefit too, since these rewards boost productivity and align individual results with company goals.
2. Non-monetary rewards
Non-monetary rewards add value without raising payroll costs. They often include perks such as wellness stipends and team shout-outs. For instance, a company could roll out peer-to-peer recognition programs to celebrate everyday wins. Employees feel reassured that the organization cares about them as people, not just their output. Employers also gain a healthier culture and lower burnout across teams.
3. Professional development
Professional development rewards focus on building skills and supporting career growth. Companies may cover course fees, certification exams, and industry events. For example, sponsoring an employee to complete a project management course shows faith in their future and reinforces a long-term commitment to growth. Ultimately, this boosts retention and strengthens the talent pipeline. Employees gain confidence and career momentum, and employers develop a more capable and adaptable workforce.
How to implement employee reward programs
Leaders need a clear plan to ensure that an employee reward program is meaningful, sustainable, and aligned with company goals. Here are the steps to get started:
- Define your goals: What do you want to achieve? Maybe it’s cutting turnover or boosting engagement. Getting clear on this keeps the program focused. Be specific — vague goals make it harder to measure success later. For instance, if turnover is your biggest headache, start by shaping rewards around retention.
- Set your budget: Figure out how much you can spend and ensure it’s sustainable. A smaller business might budget for gift cards or extra PTO, while a bigger organization could offer profit-sharing or tuition reimbursement.
- Gather employee input: Run a short survey where employees rank reward options, and then have conversations to understand the results. You might be surprised at what your team wants. For example, a majority may prefer more time off than free lunches.
- Choose meaningful rewards: Offer both monetary and non-monetary perks based on what employees actually want. For example, some people may get excited about spot bonuses, while others prefer flexibility or learning opportunities.
- Identify metrics for success: Decide how you’ll measure progress. You might look at retention reports to see turnover trends, engagement surveys to understand how people feel, and KPIs like sales numbers and project completion to track productivity.
Simplify your rewards strategies with Oyster
When you look after your team’s well-being, your business thrives. But designing and delivering a rewards program across multiple countries is often complex.
With Oyster, you can attract and engage top talent in more than 180 countries. The platform gives you the tools to implement rewards globally—managing compliant payroll, administering benefits, and ensuring fair compensation practices—all in one place.
Ready to simplify employee rewards on a global scale? Learn more about Oyster Total Rewards.
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About Oyster
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.
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