Employee rewards: the gift that will keep giving in 2021
Chris Ford, Senior Director of Incentives at Blackhawk Network
January 22 2021 - The continued impact that 2020 will have on HR and employee engagement in the future is huge. The shift to remote working saw productivity fall 35.7% in the first half of the year, in comparison to the same period in 2019. With people at the heart of any business, an unmotivated and disengaged workforce can have a hugely negative impact on business success in the long term. The likelihood is that most business leaders will have already put measures into place to re-engage employees, and ensure business success in 2021. But, they need to make sure that rewards and incentives play a big role in any such initiative. Leaders must find exciting new ways to reward and motivate their people to boost productivity and loyalty.
Moving into 2021, with promising new vaccines, the country will hopefully begin to shift the conversation from working from home to gradually returning to office life. Yet some people are reluctant to return to a full week in the office. A report by Cardiff University and the University of Southampton found that 88 per cent of employees who worked from home during lockdown would like to continue doing so in some capacity. Employers need to utilise reward schemes to engage, and ultimately retain, employees whether they work remotely or not. Hereís my advice on how to maximise employee engagement, and the chance of business success, through 2021 and beyond.
Fight to maintain employee loyalty
One thing Iím sure most business leaders can agree on is weíve all sat in meetings where weíve tried to second-guess what our employees really want - or, tried to pull insights from existing, and often outdated, employee satisfaction surveys. Existing generational and demographic data, as well as historic transactional trends, will never truly deliver the answer to what employees need or desire - especially in the post COVID-19 world.
When looking into generational differences, Blackhawk Network found that peopleís interests were shifting regularly and revealed some surprising stats which buck the usual expectations. For example, four in 10 Baby Boomers considered travel as an important hobby, but travel didnít feature at all in Gen Zís top 15 - an age group perceived to love holidays with friends or wanting to see the world by backpack. This demonstrates that taking a stereotypical view of the hobbies people partake in, based on features such as age, is no longer appropriate for companies who are looking to engage and motivate employees. Reward and benefits schemes need to be constantly reviewed by business leaders to see if they are still relevant to their employees as a result.
One key way to manage the regular changes in employee interests is by offering them choice over their incentives and benefits. Depending on the individual, they may prefer to use a cycle to work scheme; a salary sacrifice scheme to make new tech more affordable; or have access to a payment card that gives them a rebate every time they shop. At Blackhawk Network, we are passionate about providing an individual the choice of where and how to use their benefits. Matching the reward to the preference of the employee will help to maximise the positive effects, and create more loyal, productive employees.
Rewarding little and often is the strategy for success
Another shift weíve seen is that ideas for gifts are no longer focused on luxury items, and instead focused on peopleís needs. This is true for both friends and families, but also for employers gifting or rewarding employees. In fact, our Christmas research found that most employees would opt for either a financial reward (no matter what size) or a day off, rather than a corporate stocking filled with a branded charger or a new water bottle.
Itís important to remember that not every employer can afford to allow the entire company a day off work. What they could do instead, is offer those working public holidays a small financial reward. Something as simple as a £5 gift card or eCode can go a long way towards making staff feel appreciated, and happier that they can spend this wherever suits them.
This notion of giving little and often, where possible, is key to perking up employees and keeping them engaged. Not to mention, if the value of any employee reward is under £50, the thank you is categorised under the HMRCís trivial benefits tax break. That means less cost for employers, and a better result for employees, as theyíre able to see the full amount of the benefit.
Time to reset on rewards
Businesses will need to continue to evolve around a Ďnew normalí, but 2021 will be a time for a reset on how we approach employee rewards. It is particularly important to thank employees for hard work during these strange times, especially as any new year is notorious for people switching up their careers. Our recent research conducted around employee expectations at Christmas found that 58% of people didnít think they would receive any gift at all. Understandable perhaps, given the effect the pandemic has had on most employers. But, when asked if they still expected to receive a gift - no matter how big or small the gesture - the answer was overwhelmingly a 'yes', even if there was a generational disparity. When looking at millennials (ages 25 - 41), around 40% said they were expecting a gift. Over the age of 57, however, only 8% of people still anticipated a gift from their employer this year. A key takeaway for 2021 is that employers need to manage these employee expectations carefully. Where a one-size fits all approach used to work in the past, the impact of covid and increased remote working has shone a light on individual employees' different wants and needs.
Itís clear that continually assessing the relevance of reward schemes in 2021 and beyond will be key to employee engagement. Iím strongly of the belief that every recipient of a reward or gift should be able to choose how they enjoy the value, rather than being limited to a single brand, service or product. Through gift cards, eCodes or salary sacrifice schemes, giving employees choice will empower employers to give value that guarantees satisfaction and flexibility. Doing so ensures that good intentions donít lead to sour results, and instead boosts employee engagement, productivity and loyalty.