How to Build an Effective Employee Rewards Program?

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Offering employees fair pay they deserve is not enough, you also need to recognize their efforts at the same time. When employees feel their efforts are not being appreciated, they start looking for other opportunities. Building employee rewards and recognition program will be the right step to make your employees feel valued.

But building a program needs proper planning, management, and criteria to make it effective. Here are some tips that will help you build a recognition program for your business from scratch.


The first step to build an effective program is to identify the objective of the program. Each of your objectives should be meaningful and should help you recognize your employee efforts.

For example, reducing absenteeism in your organization can be one of your main objectives. You can also aim towards higher employee retention with such a program.

Management Support

The next step is to get your senior management on board with the program. It’s not possible to implement a program without their support. Once you have your objectives planned for the rewards program, set a meeting with your senior management, and discuss why you should implement a program like this.

You can explain the benefits an employee recognition program will offer your organization. And how this program will not require a heavy budget since the cost is among the main concern when it comes to management.


When building an employee recognition program, it should always include members from all levels of your organization, which includes both management and leadership. Leaving the project on the human resource department will only increase their burden.

It’s best to create a committee that will include people from every department. You can also ask for volunteers to join your committee. For small businesses, it is better to discuss the idea of the program with all employees instead.


Once everyone is on board with the idea, its time to develop criteria for your rewards program. You need to identify why you should recognize an employee while keeping your business’ core values in check.

For example, you can recognize employees who have been working with your organization for a certain amount of time, such as a five-year length of service. Reward an employee who performed exceptionally on a big project.

You can also reward employees for their volunteer work or high client retention rates as well.


To make your rewards program more effective, its best to ask your employees as well. This can be easy for small businesses but for large ones, it might not be easy. This is where surveys come into play.

Using surveys, you can ask all of your employees, including remote employees if your organization has them, what accomplishments or efforts they think should be rewarded. This is one of the best ways to get support from your employees for the program since they are the ones who will inform what they value the most.

You can also ask your employees how they want to be rewarded. This will help you decide what kind of rewards you can implement in your program.


Once you have all the suggestions from your employees, its time to set a budget for your rewards program. It’s important to understand that your rewards program doesn’t need to be expensive, but the rewards should be valuable to employees.

Once you have a budget in place, choose the rewards that you want to include in your program. Don’t forget to use the suggestions from employee surveys.

Introduce the Program

Once you have your program in place, it’s time to introduce it to your employees. It’s best to explain the program with a team meeting, instead of introducing it in an email. For large businesses, it’s best to explain the program to one by one to each department or office.


To promote and induce excitement in your employees after you have implemented the program, you can start with a design contest. This can include themes or logos for the program. The best ones get rewarded at the end of the contest.

This will make employees excited and increase engagement with the program as well.


An employee rewards program can be a key factor to increase employee retention in your organization. Once you have the program in place, it’s important to take Continuous Feedback from employees on a regular basis to understand what they feel about it. With the feedback, you can improve the program further.


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