20 Employee Incentive Ideas to Boost Engagement and Retention

Written by Gail Bailey
8 minutes read

An employee incentive program can have a powerful impact on your organization. When designed well, it increases engagement, productivity, and retention. But it can be challenging to know which rewards and benefits to choose. That’s why we’ve identified the top 20 employee incentive ideas. Come along for a deep dive to discover how they can inspire and motivate your employees.

Contents
What are employee incentives?
Employee incentive ideas
How to implement an employee incentive program

What are employee incentives?

Employee incentives come in all shapes and sizes. They include rewards, benefits, or services employees receive on top of their salary. Usually, they recognize people for their strong performance. Plus, they work to increase overall morale and productivity.

A comprehensive employee incentive program often includes financial rewards such as bonuses, commissions, or stock options. However, non-monetary incentives can be just as effective. Common non-cash incentives range from employee recognition awards, professional development opportunities, or extra time off. 

Employee incentives are a key part of your company’s total rewards strategy, so it’s essential to get them right. They can help you retain (and attract) top talent, which is critical in times of skills shortages.


Top 20 employee incentive ideas

Let’s explore some of the best employee incentive examples to reward your employees.

1. Flexible working 

Now more than ever, employees want to have options for when, where, and how they work. More employees desire flexible hours, hybrid, and remote working possibilities. According to a recent survey, 95% of workers want flexible hours, and 78% desire flexibility over where they work.

One company leading the way is Asana, which allows employees to create their own work schedules. It has a R.O.W.E. (Results Only Work Environment) policy which does not track individual hours. However, employees must fulfill their workload before taking time off. 

2. Bonuses 

Providing bonuses remains a popular incentive for many employees. Companies typically give them at the end of the year. However, consider offering bonuses throughout the year for outstanding results. Some companies today are even offering hiring bonuses, particularly for in-demand jobs.

3. Professional development opportunities

Employees value learning and growing their careers. In fact, if they don’t receive enough learning opportunities at work, they leave. This desire for professional development is especially true for Millennial and Gen Z employees, as well as senior leaders.

Professional development opportunities range from courses, training, workshops, and conferences. But they can also include tuition reimbursement.

4. Wellness initiatives

Offering wellness initiatives can not only improve employees’ quality of life but also increase morale and productivity. Wellness programs range from sponsored gym memberships, to access to mental health practitioners or healthy eating options at work.

Leading companies like Wiley, Monster, and KPMG are going above and beyond by developing wellness apps. They’re making it easier for employees to get resources on meditation, sleep, and even online therapy.

5. Family leave

An important factor in employees’ quality of life is their family. That’s why it’s good to provide options for family leave. A comprehensive policy can include caregiver and parental leave to take care of sick family members. Facebook offers four months of paid parental leave, which is quite generous for U.S. employees. It also provides family planning support, such as adoption and surrogacy assistance.

6. Childcare assistance

Another critical family-related benefit is providing some form of childcare support. This can include discounts on childcare centers, monthly reimbursements for childcare expenses, or backup childcare services. Patagonia, Clif Bar, and Johnson & Johnson even have childcare centers at their headquarters or locations.

7. Employee recognition programs

Employees want to receive praise for their hard work, which is critical to engagement and retention. However, according to a recent Gallup and Workhuman survey, only 23% of employees are happy with the recognition they receive. A simple ‘ thank you’ can go a long way to show employees you appreciate their efforts.

Common employee recognition programs include awards, certificates, or public recognition at team meetings or special events.

8. Extra paid leave

On top of standard vacation time, some companies now offer a range of extra time-off options. For example, after working at HubSpot for five years, employees get a four-week paid sabbatical plus a bonus. Going further, companies like Netflix, Oracle, and Zoom have unlimited vacation time.

HubSpot Sabbatical Bonus
HubSpot offer employee unlimited vacation time and a paid sabbatical bonus.

9. Financial well-being services

Beyond providing standard retirement plans, consider supporting employees with extra financial planning solutions. Verizon, Chipotle, and Prudential Financial are helping employees improve their financial planning. This initiative is supporting employees dealing with rising inflation and living costs.

10. Profit sharing

Receiving a share of a company’s earnings is another popular incentive. Simply put, when the company performs well, employees get some of the profits. According to Gallup, 40% of employees want profit-sharing options. Profit-sharing plans range from direct payments to stock options, or retirement fund contributions. 

11. Free or subsidized meals

Providing employees with free or subsidized meals improves their productivity and performance. According to the startup Sharebite, one in three employees would rather have free meals than extra days off. Also, 97% say that making a lunch break easier to take greatly improves their workday.


12. Team-building activities

When it comes to boosting morale, team-building activities can make a big difference. They include social events and clubs to on-site or off-site team-building events. Growing in popularity are company retreats. Don’t forget your remote workers, plan some virtual activities throughout the year. 

13. Paid volunteer time 

Rewarding employees who are passionate about volunteering makes them feel appreciated and recognized. But did you know that it also increases engagement, productivity, and retention? In a Deloitte study, 89% of employees think company-sponsored volunteering creates a better work environment.

14. Employee discounts 

Everyone loves a good discount. Offering reductions on company products or services can help create loyal brand ambassadors. Unsurprisingly, retailers tend to offer discounted rates for their merchandise. One leading example is REI, which gives employees 50% off their gear and apparel.

REI Employee Discount Program
REI offers an Employee Discount Program of 50%

15. Commuting benefits 

One way to entice workers back to the office is to make it easier for them to get to work. Providing transit passes, parking access, carpool incentives, or bicycle storage are great ways to reduce employees’ commuting costs. Many of these benefits also support sustainability-related initiatives, which are highly valued by Gen Z employees. Some unique transportation perks include electric car subsidies.

16. Experiential rewards 

Who doesn’t appreciate a good experience? You can reward employees with a range of special experiences outside of work. For example, a weekend getaway, sports tickets, or even a spa day. Experiences are a great way to show appreciation for hard work or goals met.

17. Pet-friendly office 

Let employees bring their pets to work. This gesture can help create loyal employees, especially since very few companies offer this perk. Mars, Inc. has had a pet-friendly policy for over ten years. They “walk the talk” by providing playgrounds, dog-walking routes, and dog-friendly meeting rooms.

18. Home office allowance 

Why not support employees with the expenses for office equipment, internet, or furniture? It can be a huge financial help. Hotjar, a fully-remote company, offers up to €2,400 home office budget every year. Some companies like 37signals (Basecamp) know that working from home is not always possible (or desirable). So, they offer up to $200 a month for employees to rent a coworking space.

Hotjar offers up to €2,400 home office budget every year

19. On-demand pay

Not all employees want to get paid on a monthly basis. Many hourly workers in retail, hospitality, manufacturing, and healthcare would like to access their salary as soon as they earn it. New technology like DailyPay makes it possible to get paid quickly, ahead of traditional payroll schedules. On-demand pay is proving to reduce turnover and improve job satisfaction.

20. Employee empowerment programs

Empowering employees to develop greater responsibility engages and motivates them. Empowerment programs come in many forms. Opportunities include having more control over projects, influence over customer experience, or greater input on company policies. Ritz-Carlton’s empowerment program allows employees to immediately resolve customer service issues. 

9 Steps to Implement an Employee Incentive Program

How to implement an effective employee incentive program 

  1. Assess your current incentives – Review your current incentives to identify the most effective. Before adding new rewards or benefits, review any data/metrics to uncover which ones were true motivators (and those with little impact). 
  2. Ask your employees – Find out which rewards and benefits matter to your employees. When planning new incentives, conduct surveys or focus groups. It will be time well spent to help you identify what actually appeals to them.
  3. Set specific and measurable objectives – Determine early on what you want to achieve with your employee incentive program. What kind of outcomes and behaviors do you want to encourage? Are they measurable? Then design incentives that support those objectives.
  4. Offer a good mix – Provide a balanced mix of monetary and non-monetary incentives. Particularly focus on areas employees care about the most – things like health and wellbeing, professional development, and financial security.
  5. Align with company values – Create rewards that support your organizational values. If sustainability is central to your mission, ensure your incentives reflect that commitment. 
  6. Communicate openly – Keep your employees well-informed about how your incentive program works. Equally important, be transparent about how they will earn rewards and benefits. Communicate regularly to help drive awareness. 
  7. Make it fair – Every employee should be able to enjoy your incentive program. Make sure access to rewards and benefits does not only favor top earners or particular teams.
  8. Provide opportunities for personalization – Give your employees choice within the incentives you offer. Allow them to personalize rewards based on their needs and preferences. For example, let them choose the type of experiential rewards they want instead of providing a specific list of activities.
  9. Evaluate progress – Track the effectiveness of your incentive program. Is it meeting your objectives? If not, make any necessary adjustments to improve impact. Ensure these efforts are ongoing or scheduled at critical times for your organization.

Key takeaways

  • Employee needs and preferences: The best incentives meet the needs of your employees. If the majority of your employees want to work more flexibly, providing flexible work arrangements might be more effective than monetary incentives.
  • Your goals and values: Before choosing rewards and benefits, ensure they fit your company’s objectives and values. Don’t just offer incentives because they’re popular in other companies.
  • Constant feedback: After doing all that hard work, don’t let it go to waste. Creating an employee incentive package is only half the job. Get feedback and measure regularly to identify what’s working (and what’s not).
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Gail Bailey

Gail Bailey is a versatile freelance writer with prior experience as a copywriter and communication specialist. She specializes in all things HR, writing blogs about L&D, employee engagement, learning design, DEI, and more

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