Sophia Epstein/ BBC:

Unless you work for a luxury fashion brand, it’s unlikely you’re going to get a handbag as a work perk. But London-based communications manager Jackie earned herself one through her company’s rewards system, which grants employees redeemable ‘points’ to recognise their success.
“I would never spend my salary on a £950 bag – I just wouldn’t be able to bring myself to do it,” she says. “But that’s the nice thing about these points: you can buy stuff that you’d never get yourself otherwise.”
Jackie, who works for a multinational corporation unrelated to fashion, is one of many employees now receiving micro-rewards from their companies. Instead of solely an annual bonus based on a yearly performance evaluation, these employees are instead also recognised as they achieve an important milestone or help colleagues on a rolling real time basis.
Employers are increasingly turning to these micro-rewards programmes to motivate employees, and also encourage positive culture and engagement in the workplace. Along with keeping employees feeling valued on a regular basis, these perks may also help companies boost productivity and retain workers.
‘Your colleagues value you’
Micro-rewards programmes vary from company to company. Some provide cash incentives, for instance, but many use the points system. Managers can gift them to their reports, but in some cases, team members can gift them to each other across departments. They add up over time, and employees can redeem them for a wide range of gifts at a variety of retailers.
They’re being used at many different types of organisations, says Sam Lepak, head of growth at Matter, a US-based employee recognition and rewards app.
In his company’s experience, these programmes are most sought after by companies in industries such as technology, advertising and financial services, but Matter’s customers aren’t limited to these fields. Lepak adds he’s seen a particular interest in hybrid and remote companies adopting these incentives, as newly distributed workforces have made culture more difficult to nurture – and that has become more important amid a worker-favourable labour market.There are many reasons firms are implementing these programmes, instead of sticking only to the traditional system of annual employee recognition, say experts.
First, by design, these programmes can boost employee morale as workers feel constantly valued. In Jackie’s case, she says the handbag was certainly a nice perk – but the recognition attached to the reward itself is a big part of what makes the points programme in her company so effective. Especially throughout the course of a “hard year”, she says, earning points from her managers and colleagues made a difference for her morale.
“It just makes you feel like your colleagues really value you,” says Jackie. She compares it to the feeling she gets during her end-of-year review. “I always feel really appreciated when we have that discussion, but being able to get points throughout the year, too, makes you feel like you’re appreciated on an ongoing basis.”
The element of surprise baked into many of these programmes ­­– the idea that workers can receive them at any point, and immediately – can enhance the positive effects.
Anthony Kesterton, London-based principal solutions architect at software firm Red Hat, agrees the points or other micro-rewards that catch workers by surprise are the ones that make the most impact. “Your pay package and quarterly bonuses are all part of your income, but these rewards points are really special, especially if they’re totally unexpected,” he says. Beyond the monetary value, “it’s the fact that someone has taken the time to do it” that can help lift workers’ spirits.
They can also create an important feeling of connection – and even gratitude – in the workplace.
Jeff Hagel, who owns and runs the McInnis & Holloway Funeral Homes business in Calgary, Canada, noticed his employees had become more self-reflective since the pandemic. He wanted to do something satisfying that they’d be recognised for, not just working for the sake of it. “We really tried to change our culture, to be able to keep people and keep them motivated after Covid,” says Hagel.
Before the pandemic, Hagel tried to cultivate a culture of recognition among the 100-plus employees at his company, but office donut runs and sporadic free lunches didn’t do the trick. Now, they have a more gamified approach: each employee gets a number of recognition points to give out per week (if they don’t, they disappear).
“It’s so addictive,” says Hagel. “It’s an amazing psychological motivator … we’ve seen literally thousands and thousands of messages of gratitude, which is so motivating for our team.”
‘Above and beyond’
These micro-rewards programmes can also have a positive business impact.
Along with the benefits to morale and corporate culture, says Hagel, “from a financial standpoint, we’re seeing the savings in turnover and recruitment, and all the costs associated with that”. This is increasingly important as employee retention has been difficult for companies throughout the past several years, amid the Great Resignation and workforce reshuffle.
Additionally, researchers have shown worker productivity can subsequently increase when employees are recognised with rolling rewards.