Rewarding Performance with Non-Cash Incentives


Rewarding Performance with Non-Cash Incentives

by Yi Ting
January 15, 2018

Nobody will argue that money motivates us – after all, it’s the main reason we go to work. Income is necessary for survival, luxuries and entertainment. Given this, it only makes sense to assume that money would motivate employees to work harder. After all, being able to pay their bills or buy a new TV is a guaranteed way to put their minds at ease; however, money won’t have the same effect when we want to encourage performance.

Despite money being such a critical part of our daily lives, research consistently shows that it does nothing to improve productivity or quality. For instance, a study published by the International Journal of Business Management analysed the impact of cash bonuses. They found that, while these incentives do appear to help motivate attendance,there is no relationship between cash bonuses and employee performance.

This is excellent news for businesses of all sizes, but smaller operations have a bigger reason to celebrate. They no longer need to worry about unnecessarily spending their limited capital to incentivise workers with money.

Another important point to consider is that money is fleeting. Even if the person being rewarded genuinely feels valued when they receive their cash prize, that sense of accomplishment will evaporate once they spend it.

At this point, we have to ask that if money isn’t the right incentive, then what is? Believe it or not, some of the best rewards aren’t just inexpensive (or free), but the residual effects can provide benefits beyond just productivity.

Employee Discounts

Saving money is at the forefront of everyone’s mind, so giving employees that opportunity will resonate well with them. Sammi Caramela of Business News Daily explains that discounts on things like entertainment, restaurants, electronics, subscriptions, fashion accessories and office stationery are the most sought-after items; however, she warns that these programs need to be easy to use in order to be as effective as possible. A simple discount card with the company and employee name on it, for instance, will make it easy for patrons to access these deals.

For a small business, employee discounts can be quite beneficial. While implementing large-scale deals with other companies may not be possible, coupons and gift vouchers are easy and affordable.

Time Off

Time off is a great way to reward employees for a job well done. Not only do the recipients get a chance to rest, but the effects of that vacation carry on long after they return to work. According to Tanya Mohn of Forbes, taking time off results in higher productivity, stronger workplace morale, greater employee retention, and significant health benefits.

JustLogin takes advantage of this trend by awarding an extra day off for employees who go a full year without taking a sick day. It acts as both a reward for attendance and an incentive to maintain a healthy lifestyle.

This type of system isn’t just rewarding for the worker, but it’s equally – if not more – rewarding for an emerging business. Higher retention, a healthier workforce and better engagement are all ways to improve the bottom line.

Peer Recognition

As a social species, we place great value on the contributions of others. Consequently, we also want people to know how we’ve helped promote the business’ mission, vision and goals. Not only is this a great incentive, but it’s a matter of appreciation, decency and common sense.

A simple word of congratulation is powerful. For instance, supervisors should take a few moments before a meeting to recognise an individual’s special contributions; however, there are plenty of other options. Things like bringing treats in the employee’s honour or arranging an office party due to the person’s hard work are great ways to in still pride and encourage productivity.


Another inexpensive way to recognise employee contribution is by offering services or favours. Life is full of mundane everyday responsibilities that can consume more time than we arguably have. These things don’t just drain our time, but our money as well. Obligations like daycare, cleaning or laundry services, for instance, account for a significant portion of living expenses. Of course, employers could reward hard work by subsidising or sponsoring these services to help alleviate the financial burden.


Considering we’ve spent a great deal of time talking about how monetary rewards are ineffective, purchasing gifts to incentivise employees may seem counterintuitive; however, there’s a major difference that impacts the way gifts encourage performance in ways that cash won’t. The key is that gifts can be personalised.

In order for this approach to work, it’s important to understand each employee – their interests, likes and dislikes, etc. This should be quite easy in a small business environment with only a handful of staff.

For example, if the worker in question likes trying new foods, they would appreciate gift certificates to different restaurants. Or perhaps he or she spends a lot of time at the movies. In this case, movie vouchers are the obvious way to go.

Some employees may be interested in helping others. This is a great opportunity to offer donations in the staff member’s name to a charity of their choice. It’s an opportunity for them to pass on their success to those they feel can benefit most.

Gifts don’t have to be expensive – $25 to $50 is plenty (depending on the product). The dollar amount doesn’t matter nearly as much as the message behind it.

Be it independent research or simple experience, businesses need to realise that the days of monetary incentives are progressively ending. Arguably, there are hundreds of great, creative approaches to employee rewards. As long as these gestures emphasise your business’ gratitude, the exact nature of the prizes will rarely – if ever – be wrong. 

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