Recall a time when you interviewed candidates for job openings at your company. When it came to what old school employers call ‘compensation and benefits’, they may have refused to join your company because you offered the same perks they got from their existing jobs or less. Or during the hiring process, they may have heard through the grapevine about a manager at your company whose reportee quit because he was a harsh critic.

It’s human nature to expect to be repaid fairly and appreciated for effort put in, and this notion applies to the workplace, too. In other words, people want rewards and recognition for the work they do.

What are rewards and recognition?

If you’re an employer or HR professional, chances are that you decide what to give your employees in return for their efforts. Along with salaries, you might be offering a bunch of other perks, both monetary and non-monetary. These are what we call rewards.

Recognition, on the other hand, is about openly appreciating employees’ efforts, especially when they hit major milestones.

Benefits of rewards and recognition for employers

The whole point of rewarding and recognising employees is to set the company up for success. So, it’s always a wise idea to invest in such incentives. Here’s why:

Higher productivity

It’s no rocket science to know that people are willing to make an effort when they know they’re going to get something of value in return. Now apply this concept to the workplace - if you repay your employees with more than their existing compensation packages, they’ll get more work done in a day than before. The more you compensate them, the more productive they’ll be. Compensate them less and even top performers will choose to laze around instead of working.

In the grand scheme of things, higher productivity means better company performance in terms of sales and profits.

Greater employee engagement

Every employer wants its employees to be committed to the companies they run, but that is far from reality. It’s very common for employees to show resistance when they’re asked to do things that aren’t listed in their job descriptions. These things could be as small as resharing posts from the company’s social media pages for better reach or as taking on a new extra-role project alongside routine tasks.

The thing to remember here is that nobody wants to work for free. If you’re going to ask your employees to be committed to helping your company succeed, make sure that you’re compensating them fairly if not better than your competitors.

Lower employee turnover

Frugal compensation is one major reason why people leave companies even after serving them for years. Recall the initial days of the post-COVID world when companies across the world introduced work-from-home policies. That alone encouraged millions of employees to stick to their jobs.

On the other hand, there are some companies out there that don’t want to hop on the bandwagon for some reason or the other. So, it’s no surprise why their employees leave them so frequently. If this is the case at your workplace, revisit the rewards structure and recognition tactics you have in place. Things could be going wrong in either or both areas.

Positive public image

Don’t believe in the saying ‘all publicity is good publicity’. If you want your company to do well, it’s important for it to have a good reputation among stakeholders. There’s no one better to promote your company to other people than your own employees as long as they are compensated generously. If you’re not already doing so, give them free lunch with two work-from-home days a week instead of one and watch the news spread like wildfire. There’s a lot more you can do here, but you get the picture. Great talent will want to join your team, media houses will want to feature your company in their publications and other businesses will want to partner up with you on various fronts.

5 Best Employee Rewards and Recognition Tactics

We’ve touched upon compensating employees well, but what does this actually mean? We’re about to spill the beans on this.

1. Earned Wage Access (EWA)

The concept of on-demand pay has been around in Europe and the US for several years and only recently made its way to the Pakistani market.

The cost of living for the average Pakistani earner has gone up by many multiples in the past one year. Unexpected expenses such as an increase in the price of petrol have come up mid-month, maxing out salaried people’s budgets. Some have to borrow loans at sky-high interest rates while others have to spend their savings just to make ends meet.

With Earned Wage Access, your employees can draw the salaries they’ve alredy earned in the month whenever they need the money instead of waiting for salary day. That’s an unmatched reward.

2. Quarterly salary increments

This may sound strange but trust us, it works. Tie performance to pay, and those who meet their KPIs for the quarter get a salary bump. Those who exceed their KPIs get an even bigger salary bump.

Increasing salaries quarterly is a great way to pull up employee performance quicker than annual increments would.

A quick disclaimer though - we’re not saying you should max out your HR budget in a single quarter. Do what’s feasible for your business.

3. Generous overtime pay

Most companies in Pakistan don’t give their employees overtime pay. Even the ones that do generally restrict overtime pay to Customer Support teams. This is not fair game in today’s day and age when remote work has opened up a sea of job opportunities for great talent.

Introduce an overtime pay policy for all employees. You could offer them, for example, 1.5x of one day’s salary for working on a Saturday and 3x of a day’s salary for working on public holidays such as the first day of Eid and Independence Day. It won’t be a dent in your pocket in the long run because you’re getting your employees to achieve better outcomes. However, work-life balance is also important, so make working on days off the exception, not the norm.

4. Remote work flexibility

It’s standard practice in Pakistan for companies to allow their employees one work-from-home day a week. Because it’s become such a common perk, it’s not such an effective motivator anymore. Employees want more than that and we don’t mean just one more work-from-home day in the week. Value impact over face time for a change.

Give your employees the flexibility of working remotely whenever they choose as long as they show up for meetings, training sessions and work events. You’re going to have to trust your employees here, but that’s what is going to make you an employer of choice for top talent.

5. Better health insurance

Literally every company that gives its employees health insurance limits the benefit to just the employees or them and their spouses. What if you were to extend the benefit to employees’ parents or children? If you want to be mindful about spending, you can set expense limits that fit your budget, but the fact remains that you’re taking care of your employees’ families. Who wouldn’t want a job that offers that?

The wrap-up

The tactics we’ve talked about in this article are just a few of the many incentives you can offer your employees. However, it’d be wise to find out whether or not your competitors are offering the same. Ideally, you’d want to outdo them if your budget allows you to, or offer an incentive that your competitors don’t offer. That’s what will make you the employer of choice for talent and, ultimately, the brand of choice for customers.