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How to reward staff on a tight budget

28 Apr 2021

There are a number of ways you can recognise and reward employees if money is tight at the moment, writes Hays’ Jane McNeill.

Recognising top performers has long been viewed as a good strategy to motivate future performance. But how can you reward staff when budgets are tight? Regardless of how deserving they are, if the money isn’t available then the bonus or raise an employee may have otherwise expected can no longer be given.

The good news is that, for many employees, non-financial benefits are just as important as the monetary component of any staff recognition programme.

Here are nine ways to recognise top performance when budgets are tight.

1. Remember that it’s not one-size-fits-all

Firstly, it’s important to identify and recognise what motivates each individual employee. Good recognition starts with gaining feedback from your employees to ensure the rewards you offer will motivate them.

After all, not everyone is motivated by the same things. Therefore, open a dialogue with your employees and invite them to identify which non-financial recognition and rewards they would prefer. You can then personalise the recognition you offer based on the motivations and preferences of each individual employee.

2. Express gratitude

A genuine and heartfelt ‘thank you’ can be highly motivating. There are different degrees of recognition though, so decide which will work for the employee in question. For example, some employees find it very satisfying to receive formal public recognition, while others prefer a deliberate ‘thank you’ in a smaller team or one-on-one meeting. A team email or thank you note are other options.

Regardless of the method you select, offering words of gratitude to an employee for their efforts and acknowledging the value they’ve added to the team or organisation shows you’ve not only noticed their success, but value their contribution. It shows that you understand their effort is worthwhile and important.

3. Use internal social platforms

Many modern recognition programmes also use internal social media, such as recognition-specific tools or apps, to instantly recognise employees who go the extra mile. Managers and peers can single out high performance, with the results displayed on the staff intranet or organisation’s social channels so that anyone can see them.

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4. Give them opportunities for progression

Many employees are highly motivated, so offering an opportunity to design a career-progression plan to help them reach their goals is another way to recognise outstanding performance.

Sitting with an employee after their annual review, for instance, to determine how they can position themselves for a future promotion can be very meaningful. It shows you are invested in their future, while acknowledging their strong performance in the here and now.

5. Challenge them

Not everyone is motivated by a promotional pathway, though. For other employees, the opportunity to work on more challenging or varied work and expand their skills may be more meaningful.

Or perhaps you could consider giving them the opportunity to lead a project or scope out an identified opportunity for growth.

6. Promote them based on merit

It’s important to continue to acknowledge and action merit-based promotions, even when budgets are tight. While you may not be able to offer a pay rise, you should still honour any pre-arranged commitment to promote an employee who has met the targets and objectives required to qualify for advancement.

Failing to keep your word by not recognising such a success would demotivate an employee who has worked hard to be eligible for a promotion and may potentially create an engagement and retention risk. Furthermore, it could have wider-reaching effects, potentially damaging your employer brand and reputation in the market.

7. Help them learn and develop

No one wants to feel that their skills are stagnating. Therefore, offering ongoing learning and development opportunities can be a great way to reward staff. There are various ways this can be achieved, such as through coaching, mentorship, the chance to sit in on important meetings, cross-collaboration with another department or a stretch opportunity.

Taking on additional responsibilities allows you to reward an employee in a way that will aid their longer-term career. They can learn new skills, hone others and gain exposure that will aid their promotional prospects or help them do their existing job even better.

At the same time, you can encourage the development of skills that are in short supply within your team, thereby helping you to overcome any skill gaps, which is a win-win for both you and your employee.

8. Introduce more flexibility

Flexible working options are very important to today’s skilled professionals. Many people have experienced remote working throughout the Covid-19 lockdowns and have come to see the benefits it offers.

But flexible working does not only encompass remote working. You could also consider rewarding a top performer with flexible working hours or flexible leave options. Part-time employment and job sharing are other examples of flexible working in action.

While not all workplaces can reward staff in this way, for those that can it is a strong benefit you could provide in lieu of financial recognition and reward.

9. Help them reach a good work-life balance

For many people, receiving additional time off to spend with their family or friends, or on social or leisure activities, can be highly rewarding. After all, if time is money, then this could be an ideal middle ground when financial rewards are unavailable.

You could, for instance, offer a top performer the opportunity to take an afternoon off or have a long weekend. Offering an additional day of annual leave each year is another option.

Such staff rewards help your employees feel that their efforts have been recognised while giving them an opportunity to rejuvenate, which is particularly important if they’ve just completed a complex or all-encompassing project.

By Jane McNeill

Jane McNeill is director of Hays Australia. A version of this article previously appeared on the Hays Viewpoint blog.

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