Long service awards are given to employees by management or HR teams to recognize and celebrate their tenure with the company. Traditions once called for items like an engraved watch or fountain pen to mark a ten or twenty-year anniversary. Yet in our digital age, these gifts come off as outdated and irrelevant to the current workforce. A carriage clock no longer says; ‘We appreciate you!’ Nor does it motivate employees to continue to spend the best years of their career with one company. Which is exactly why reward programs for employees are shifting, including long service awards.
Change up the benchmarks
Employee churn is at an all-time high, especially within the younger workforce. Surveys have shown that one-third of new hires quit their jobs within 6 months of starting. It’s no longer the norm to put in multiple years at the first job out of college. In the gig economy, more and more individuals opt for the self-employed or freelance route. Which makes employees that do stay with a company even more invaluable. Instead of waiting for a five, ten, or twenty-year anniversary—rethink your timeframe for long service awards. What’s the lifecycle of your employees? On average, how long do they stay with the company? Use this data to refigure the timelines for long service awards. Also, consider smaller annual rewards which will show appreciation on a consistent basis. A recent study by SHRM and Globoforce found that employees who regularly receive small gifts are eight times more engaged. Annual rewards combined with long service awards can significantly boost your employee retention rate. If your HR team doesn’t have the bandwidth to rework your current program, outsource to an employee rewards system that will do the hard work for you.
It’s time to personalize
When selecting rewards for employees, HR and management teams should focus on personalization. Think–what would that specific employee want the most? This is especially true for long service awards. Each employee has offered unique value to your company during their tenure and you want to recognize that with individualized rewards. The annual Deloitte Human Capital survey said it best; “talent today wants a custom rewards experience that reflects how they live, work, and communicate—not a one-size-fits-all approach rooted in the past.” Take the time and effort to show employees that you truly appreciate their hard work and dedication.
If your company creates an individualized and dynamic rewards program, you’ll not only boost the morale of current staff but also give your organization an advantage in today’s job market. Develop an amazing rewards program with unique ways to celebrate longtime employees and use it as PR (but not in the tired ‘employee of the month’ fashion). Such changes in your corporate culture will not only bolster engagement of current employees but also help to attract new talent.
Experiences over cash bonuses
If traditional long service awards are out of date, some HR professionals might automatically revert to cash bonuses. While bonuses are definitely an important part of your overall employee appreciation program — money isn’t the answer when it comes to personalized long service awards. Recent studies have shown that 78% of millennials choose to spend more money on a desirable experience or event over buying material goods. Millenials make up a significant percentage of the workforce and Gen-Z follows close behind, which means companies cannot ignore these trends. If you want to recognize an employee, offer an experience or event, instead of giving employees cash bonuses (that are also often taxed).
When given cash bonuses, employees may feel obligated to put it towards common everyday expenses, pay bills, or add to their savings. While those aren’t bad ways to use a bonus, an experience instead, offers a rich memory that can shape a person’s identity. The guilt factor is eliminated when an employee receives an experience, as opposed to receiving a traditional cash bonus and feeling bad about spending it on themselves.
Flexibility is key
Employees value the ability to choose their rewards and recognition. When you give experiences for a long service award, the possibilities are endless—a hotel stay, a concert, sporting event, etc etc. Unless your HR team intimately knows all employees, it would be difficult to identify the correct experience for each individual. Which is why offering the ability to select experiences for themselves is best practice. Choose milestones for your long service awards and pick a budget. When you work with a rewards platform, there is some work to develop the program initially, but it will run itself afterward. Rewards systems allow for HR and management to be very flexible within set parameters, and offer employees the benefit of picking the perfect experience or event to celebrate their accomplishments.
Finding, engaging and retaining employees is a major concern in the current workforce. When polled, 37% of the management-level staff recognized employee reward programs as very important, yet only 9% feel they are prepared to take on the challenge of employee rewards. While employee appreciation programs might have made recent cultural shifts, that doesn’t mean it has to be difficult to figure out. Recognize and reward employees consistently along their career path with your company, don’t wait for far-off milestones. Utilize an integrated rewards system to set up consistent benchmarks. Even if you choose to recognize smaller milestones, don’t let that diminish long service awards. Anniversaries should be celebrated with unique and dynamic long service awards that reflect an employee’s true values.