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Employee recognition 101: How to build an employee rewards and incentives program

Want every employee in your business to feel valued, motivated, and committed to achieving your company's goals? Turns out, there's a solution that can help turn your vision into reality—an employee rewards and recognition program.


In this guide, learn the impact of employee rewards on your business and the steps you can take to implement an effective rewards and recognition program today.

Why employee recognition is important

The numbers don't lie: 80% of Canadian employers amped up their rewards programs in 2022 to attract and retain talent. For employees, rewards aren't just incentives—they're affirmations of their value in your organization:


  • Engagement soars with recognition. When you give your team the recognition they deserve, you're investing in their engagement. In fact, a recent study on employee recognition found that employees who received recognition monthly are 36% more likely to report feeling engaged and dedicated to their work.
  • Productivity's secret ingredient. It might seem like a small gesture, but recognition has the power to supercharge employee productivity. It has a domino effect. Recognition leads to increased motivation, which results in heightened productivity. It's no surprise then that 73% of employees in the study pointed to recognition as a key driver behind their productivity.
  • An employee retention recipe. While many factors influence an employee's decision to stay, recognition stands out as a crucial ingredient. In response to a 2022 survey, 57% of employees revealed that feeling more appreciated in their current positions would make them less tempted by other job opportunities—even ones that come knocking via headhunters.

A closer look at employee recognition programs

Understanding the significance of recognition on your team is just the first step. It's essential to build a rewards program that resonates with your company's unique dynamics. From celebrating individual feats to acknowledging significant milestones, there are several options to consider implementing.

Performance-based rewards

These rewards are directly tied to particular achievements, ensuring that standout performances get the spotlight. By highlighting these accomplishments, you not only reward excellence, you also inspire others on the team to raise their performance bar.


For example, do you have a team member who consistently ensures bills or invoices are organized and tracked efficiently? Offer them a bonus or an extra vacation day to show your appreciation.

Peer recognition programs

This approach is all about empowering your employees to acknowledge and appreciate each other's efforts. By setting up platforms or occasions for team members to acknowledge each other, you foster a collaborative environment where everyone feels seen and valued by their colleagues.

Consider how workplace safety is a priority on worksites. If you're in construction, try implementing a monthly trophy based on co-workers' nominations—awarded to employees who've shown exceptional diligence in ensuring site safety.

Milestone recognition

By celebrating significant milestones, you show your appreciation for the enduring relationship your employees have built with your company over the years. It's a way to acknowledge their loyalty, contributions, and the invaluable role they've played in your company's growth story.

If your salesperson just hit their 5-year mark with your company, you could present them with a watch and a team lunch in their honour to celebrate their dedication.

Personalized rewards

The goal of custom-tailored rewards is to craft tokens of recognition that will deeply resonate with individual employees. By understanding and aligning rewards with the recipient's tastes and preferences, each gesture of appreciation will feel genuinely special.

If your receptionist has made it clear they have a passion for books—they're always discussing the latest novel they've read—consider recognizing their contributions to your company with a bookstore gift card or a book club membership.

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Kickstarting your employee rewards and recognition program: A concise guide

Your rewards program can transform the dynamics of your workplace—but it needs careful planning and execution. Ensure the program resonates with your team by tailoring it to align with your company's values and objectives.


Here's a step-by-step guide to help you on your way:

  1. Know your purpose: Before you dive in, define your core objective. Is it to drive sales, improve retention, or promote specific employee behaviours? Having a clear purpose will help guide every subsequent decision you make.
  2. Set clear goals: Identify the specific outcomes you want to achieve—for example, a 10% increase in productivity or a 5% decrease in turnover.
  3. Choose your KPIs (key performance indicators): With your goals in place, decide on the metrics to objectively measure the program's success, such as engagement rates or performance benchmarks.
  4. Shape the program: Design rewards that appeal to your team. It could be a mix of cash bonuses, extra days off, and maybe even professional development opportunities. Be sure to pair each reward with clear, achievable criteria.
  5. Spread the word: Create some buzz. Use team meetings, emails, or a dedicated workshop or portal to explain the program's mechanics and benefits.
  6. Begin the journey: Launch with a clear timeline, and ensure everyone knows when and how rewards will be distributed.
  7. Gather feedback: After a few months, begin collecting feedback to help you understand what's working—and what isn't.
  8. Review and refine: Based on feedback and the data from your metrics, periodically make the necessary tweaks to your program to ensure it remains relevant and effective.

Payroll systems: Your ally in employee rewards management

Recognizing your team's efforts is a game-changer. But efficiently managing your rewards program shouldn't feel like an added chore on your already busy plate.


Enter the payroll system, a trusty sidekick to ensure your rewards land right where they should, punctually and precisely. With a system like QuickBooks Payroll supporting you, every “thank you" you give feels just right.

And the best part? With the right payroll system, the heavy lifting of managing your rewards program is taken care of. QuickBooks Payroll, for example, offers automation, real-time tracking, and a user-friendly experience. So, while you focus on building connections with your team, your payroll system makes sure every gesture of gratitude is delivered on point.

Reward faster, work smarter

Integrating your rewards program with a seamless payroll system like QuickBooks Payroll ensures your team feels valued on time, every time. QuickBooks' hassle-free payroll solution helps you to manage your rewards program smoothly.


Why wait? Experience the ease of QuickBooks Payroll and let your rewards program shine!


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