Cost effective ways to reward your team
It’s widely recognised that high staff motivation is essential for outstanding businesses, especially growing enterprises where energy, enthusiasm, drive, commitment and loyalty are key ingredients for team success.
Excellent business leaders continually seek to reward staff for their good work. The dilemma they face, particularly in these uncertain times, is how to do so in a cost effective way?
Listed below are a number of suggestions which business owners and management may want to consider as they look to reward their hard working staff within budget.
Providing your staff with free, high quality breakfasts can be a great way of motivating your employees at a relatively low cost. I suggest ordering breakfast foods from supermarkets rather than catered breakfasts to keep costs down.
Good quality and a variety of options, including healthy choices will encourage staff to come to work earlier in order to enjoy their breakfast. If the offering is varied and of good quality, it will also make them feel valued. Try to allow input from your team in relation to breakfast ordering, but allocate responsibility to one individual to control budget and arrange orders/deliveries.
Examples of breakfast items could include: bread, good coffee and teas, fruit juice, spreads such as peanut butter, jams & nutella, yoghurts, and a variety of fresh fruit and cereals. Kitchen accessories such as a coffee maker, toaster and smoothie maker are also great additions.
Providing a nice space where your team can breakfast and socialise will uplift team morale. It is important to set a strict “breakfast must be finished with all employees at their desks by……..” rule to ensure that the breakfast offering doesn't delay employees' start times.
In the UK, this is not a benefit in kind for staff and the company will have no tax liability for this provided that the food is of a ‘reasonable value’ ie not too expensive, and there is a staff area in which to eat.
Free mobile phones & contracts
Everyone likes to have the best and latest mobile phone. Monthly mobile phone & contracts are increasingly expensive for individuals, especially as general data usage goes up.
Even the smallest companies can negotiate well priced commercial mobile phone contracts, effectively getting a ‘bulk buy’ discount. Commercial contracts typically last 2 years and the entire company is often given a generous data pool which can be used by all individuals. So for a cost which can vary from around £15-40 per person per month, depending upon the phone and network, you can offer your staff a new phone upgraded every 2 years, free business and personal calls and data usage. Your employees will be able to port their personal phone number in and out of the contract as they wish.
You will need to protect the company with a policy for data and call overusage (especially when abroad) by individuals, as well as insuring the phones.
In the UK, this is not viewed as a benefit in kind for staff and the company will have no tax liability for this provided your team members are only provided with one mobile phone or sim card, and that the phone contract is between the company and the supplier.
Birthday cake and gifts
This is a great way of making your staff feel special. A birthday cake, a small gift, and presentation in front of the team (of course while singing ‘Happy Birthday’!) will make the birthday girl or boy feel good, if slightly embarrassed!
Personal gifts are a really effective way for showing that you care.
UK tax law states that such gifts are not taxable and classed as a ‘trivial benefit’ if they cost the company less than £50, and are not cash or vouchers.
I’ve worked at companies which provide Friday bars and/or Friday treats at around 4pm each Friday. It’s such a nice way to wind down after a long week and the last hour or two on a Friday isn’t going to be the most productive time for employees anyway. So not much to lose from a company perspective, but a good incentive for the team to get their work done as early as possible as well as boosting team culture and bonding.
Offering your team a suite of discounts on shopping and leisure activities is always popular. There are companies that offer packages for employers to offer their staff and the discounts typically cover superstores, restaurants, gyms, cinemas etc.
Note that provision of this kind of reward may be taxable.
Share save schemes
Share save schemes, such as Save As You Earn (SAYE) in the UK, allow employees to save monthly and buy shares with those savings at the end of the savings contract.
It’s a great way for employees to participate in the equity growth of the company in a very tax efficient way and at reduced risk to themselves. If the shares drop in value, the employee should get their money back and if the scheme is a good one, they will also be protected against the company itself going bust by the Financial Services Compensation Scheme in the UK.
The main tax benefit is that any increase in share price (from the fixed price offered at the beginning of the scheme to their market value at the end of the scheme) is tax free.
SAYE can be less effective for smaller companies, but a non government scheme can still be set up. In this scenario, there would be tax on any option gain, but from a company perspective, would still allow equity participation whilst avoiding many of the complications of direct shareholding by employees.
Smaller businesses in the UK may also be interested in looking at Share Incentive Plans (SIPs) which are government sponsored.
Nothing is more valuable than time. Awarding deserving individuals surprise paid time off to spend as they please will be welcomed with open arms and viewed as a very special reward.
Care should be taken to emphasise that awarding such time off is on an adhoc and discretionary basis, and in no way an entitlement.
Killer staff parties
Make people feel important and valued by making your staff parties extra special. This doesn’t necessarily mean increased costs. Choosing cool and unusual venues that offer experiences can lead to fantastic events.
I work in London and examples of killer staff parties include taking the team boating on London’s canals, spending the evening in a themed interactive bar - eg table tennis, mini golf, darts, or building up to the evening with team building offsite activities such as escape rooms or go karting.
One summer party I was lucky enough to attend was based around fly fishing (something no one had ever tried) in beautiful countryside and with a lovely picnic lunch.
Give the team something to talk about to their friends and families.
Team meals out
Occasional meals out with the team can be lots of fun. Getting foodies in the team to select restaurants within budget really adds to the experience.
This has no taxable benefit to company or staff in the UK if it falls within the £150 per staff entertaining per individual limit set by HMRC.
One off treats
One off surprise treats can be excellent ways of rewarding individuals or teams and can be very cost effective.
Examples can range from minimal cost gestures – eg ice creams when it’s hot outside – to slightly higher but palatable spend – eg hiring a massage therapist to go around the office and offer everyone a shoulder massage.
It’s proven that power naps of 15-20 minutes provide significant benefits to individuals, which can ultimately benefit the company. Increased alertness and cognitive functioning, and the lowering of stress levels are just some of the noted gains of napping for a short period during the day.
By providing a pleasant place to rest and zone out, power nap, chill on a sofa and switch off, you are giving your employees a chance to recharge and become more productive.
Care should be taken to ensure the space is not a social one, but a place to relax. Guidance on acceptable usage should be communicated to all staff.
Team development & training sessions
Individuals are motivated by development. Enrolling staff onto internal or external training programmes in company time demonstrate to the team that you are investing in them.
Employees will see development and training as a reward if they are offered a choice of training options, or if the company contributes to appropriate training courses that they have identified and selected themselves.
Small surprise bonuses can be really motivational, especially if unexpected. If given as a reward for hard work, be mindful to communicate that the bonus is a reward and not an entitlement. Regular bonuses can come to be viewed as ‘part of the package’ if not handled properly.
Employee of the month
Recognising employee achievement and hard work across the company on a regular basis will enhance individual motivation and encourage healthy competition within the team. Having nominations from other team members is also hugely rewarding and satisfying.
Employees of the month could be given a gift, their picture posted on the company wall of fame (a large framed picture hung prominently in the office) and other perks.
This may be a winner given current social distancing requirements. With the good summer weather still around, why not take the team out for a picnic? There are bound to be nice parks which are accessible from the office. Treating everyone to a nice picnic lunch with a few extravagances (eg good quality sandwiches and salads, fruit juices, cakes, brownies, ice cream etc) in a beautiful park environment is a great ice breaker and will encourage people to relax. It’s a great way to bond and socially engage.
Community service time allocation
Everyone feels better when they do something good for their community. Allocating some paid time for employees to volunteer in any way they choose is a really nice way to engage both your employee and the local community. It will give your team members nice time away from the office whilst getting involved in something worthwhile.
A combination of a some of the above suggestions can go a long way to show employees that you care and appreciate their efforts. Your employees are individuals who are naturally appreciative of kind and thoughtful gestures from management. Performing these actions can result in stronger team bonding, higher motivation, increased loyalty and a happier, more effective team.
Following some of the advice above will go some way to creating a culture which people are truly engaged in.
It is essential to note that none of the above suggestions will work unless your staff feel that your appreciation is genuine. Be authentic, relentless and engaging in your approach to staff motivation, and you can be confident team culture and loyalty to the organisation will improve and strengthen.
In the end, it will be your business that will reap the rewards.