11 employee incentive programs to boost motivation & performance (2024 guide)

Everyone loves to feel appreciated and recognized for their hard work. Is your company doing enough to incentivize and support your employees?

Employee motivation is a hot-button topic, especially in industries with higher-than-average staff attrition and burnout. 

The most employee-friendly companies understand the importance of incentive programs to reduce these issues. These strategies encourage and support employees to stay at a company and produce great products or services.

Happy, engaged teammates produce higher-quality work. If your company wants to grow within your industry, supporting your team is an absolute must.

Use this article as a helpful guide to some of the most commonly used and most effective employee incentive programs. They’re well worth investing time and resources into. 

Employee incentive programs are specific strategies to keep your current employees motivated, inspired, and striving for top performance. These programs drive passion and great performance through monetary rewards or benefits.

Depending on the type of programs your company offers, you can distribute rewards, bonuses, or long-standing benefits and perks.

Creating a great employee incentive program can make your current employees happier and more loyal to the company. These programs can also be a powerful promoter, attracting new, talented workers to your organization.

No matter your industry or niche, creating a positive, motivating, and desirable working environment is one of the best ways to position yourself as a leader in the space. 

Companies that invest in well-made employee incentive programs set themselves up for success in many ways. 

If you’re on the fence about implementing these programs, here are a few examples of the benefits of offering employee incentive programs:

They inspire individual and team productivity

Happy, appreciated employees are 12% more productive than those who feel undervalued. 

Low employee motivation and productivity are often complex to quantify. But it can be incredibly costly for your bottom line and impact your brand’s product and service quality. 

Low productivity levels can result in extended deadlines, lost resources, and overhiring. These significantly impact your company’s ability to remain financially sustainable. 

To combat this, your company can offer tailored employee incentive programs. Creating a program that excites your team fosters a more positive, productive workplace.

They nurture employee loyalty and belonging

Everyone loves feeling valued, respected, and fairly compensated for their work and contributions. 

If your company goes above and beyond to ensure every employee feels appreciated, they’re more likely to be loyal to your company.

Committing to employee incentive programs is a great way to combat worker attrition rates, keep top talent within your organization, and build team loyalty to your mission and work.

They entice new high-quality talent

Companies that deliver on desirable employee incentives are more likely to catch the eye of high-quality talent looking for new work. 

As younger generations enter the workforce, their interest in positions with additional perks and advantages is changing how employers view the hiring process. 

Help your company stand out from your competitors and scoop up the best talent. Offer comprehensive, personalized employee incentive packages to entice and excite those seeking long-term career opportunities.

They boost morale during periods of stress

Product sprints, new feature launches, and periods of uncertainty within the company are sources of career stress that impact employee morale and motivation. 

During these stressful times, it is easy for your team to experience burnout, increasing the chances of employee disengagement or attrition. 

Pairing incentive programs with milestones (like post-launch bonuses or time off) can keep your team engaged and motivated. Yes, even when they’re working through busier, more stressful projects!

If you’re in a position to implement (or encourage the implementation of) employee incentive programs, here are a few top-rated options worth exploring:

Salary raises or bonuses

Let’s start with the most well-known employee incentive: Cold hard cash. 

Being upfront about compensation like salary raises and performance bonuses goes a long way toward improving team morale. 

We all want to be paid what we are worth, know our careers are leading towards continual growth, and be appreciated for high-quality, hard work. 

To use this employee incentive program effectively, be clear about how you’ll evaluate employee performance for bonus consideration. 

Your company can monitor metrics and encourage employees to go above and beyond in their work for rewards. 

We recommend meeting with staff quarterly or twice yearly to keep both parties in the loop and on the right track.

Important note: For this type of incentive program to work, companies need to avoid pitting employees against each other in competition for raises and bonuses. 

This leads to animosity, less collaboration, and resentment, which you should avoid at all costs to maintain a healthy workplace environment.

Extended health and benefits programs

Access to quality health benefits is a huge incentive for many people to work for a particular company. 

Offering additional wellness allowances outside of existing health benefits is a fantastic way to support your employees’ health and wellness. It shows that you value them and their well-being. 

In addition to paying for employee health benefits, other wellness incentive ideas include:

• Offering a health spending account for fitness classes and gear

• Additional spending allowances for relaxation massages

• Paying for monthly mental health support outside of regular health benefit coverage

• Company-wide wellness retreats

Additional paid time off

Another well-loved employee incentive is offering and encouraging the use of paid time off outside of the standard amount provided by your company.

Companies commonly offer this perk to employees who’ve been with the company for many years. You can also provide it to your top performers as an incentive to keep hitting targets. 

Offering a few extra days off a year (or even paid half days) is a great way to promote a healthy working environment that supports and values work-life balance.

Important note: If your company chooses the more modern, start-up option of “unlimited” time off, be wary that this model often results in people taking less time off than conventional vacation systems. 

If you still want to use this model, we encourage you to enforce the use of at least a certain number of vacation days.  This ensures everyone is taking time to rest and recover.

Flexible working opportunities

As the definition of modern work evolves, offering flexible working hours and locations is an excellent incentive for employees with busy schedules.

Being able to work from home is a huge incentive for anyone, but it can be a significant quality of life improvement for employees with young children and long commutes. 

Depending on your company’s comfort level and type of work, examples of flexibility incentive programs you can implement include:

• Offering remote or hybrid working opportunities

• Allowing employees to choose their start time

• Implementing half-day Fridays

• Extending break and lunch periods

• Transitioning to a four-day working week

Professional development opportunities

Does your company allow your team members to attend professional learning events and conferences? This excellent employee incentive program idea is well-loved across any industry.

Offering to pay for employee professional development opportunities means your company benefits from improved internal motivation. Plus, your whole team gains access to the insights and training from these events.

To encourage employees to share their experiences at a professional development event, we recommend holding an all-hands meeting afterward. The attendees can discuss what they learned and how it can apply to the team. 

Bonus points if you make it a lunch-and-learn with a paid hot lunch!

Tuition and education allowances

Employees often want to expand their horizons and achieve greater performance. 

If your workplace is brimming with ambition, offering partial or complete education allowances is a fantastic idea. It’s a great way to offset the financial barriers of attending educational programs.

Being upfront about your company’s commitment to supporting your employee’s mission to learn is a great way to foster a sense of community and belonging.

The extent of coverage and the types of programs you financially support are up to you. Just ensure employees have equal access to tuition and education allowances if they take on additional training.

Offering paid time off and flexible working schedules is a great pairing with this incentive program, making learning much more accessible.

Employee recognition programs

Regularly recognizing employees’ hard work can go a long way to boost morale and motivation.

Here are a few options to motivate and support your all-star team:

• Employee of the month awards

• Employee highlights on social media

• Staff callouts during all-hands meetings 

Important note: While most people enjoy receiving a personal callout or reward for their work, not everyone will appreciate this gesture. 

Always ask employees about their comfort level with sharing their work and accomplishments publicly before talking about or posting about any employee.

Referral bonuses

Looking for a way to find quality talent while supporting your existing employees? Offering referral bonuses as an employee incentive can tackle these issues at the same time.

Finding high-quality, new talent is a time-consuming and expensive process. Encouraging your employees to recommend possible candidates cuts back on hiring costs. It also involves your existing team in the hiring process, and you can fairly compensate them with a bonus. Win-win!

Referral bonuses can range in size and amount depending on the positions you’re hiring for. Some companies opt to release the bonus after the new hire has worked at the company for a certain number of months. 

Be clear with the program rules and expectations so your existing teammates can participate and benefit from the perks correctly.

Mentorship programs

Another great way to incentivize productivity within your team is to offer mentorship opportunities for employees looking to climb the ranks within your company.

Mentorship programs are a great way to incentivize company loyalty within your team, with resources to accelerate career development. It also helps employees familiarize themselves with other departments' systems and protocols. 

Employees who take advantage of mentorship programs are more likely to network within the company efficiently, receive raises sooner, and have a happier day-to-day working experience.

That makes this incentive program a clear win-win situation for your team and the company’s upper management.

Profit sharing initiatives

Offering profit-sharing bonuses at the end of the year can be another powerful employee incentive to keep your team motivated and on track.

A pre-tax contribution of a set percentage of the company’s annual profit can be a big productivity draw. This type of financial incentive encourages team members to stay focused on their goals and contribute to the team to their full capacity. 

Team members who produce better results throughout the year can receive a higher percentage profit-share bonus as a reward. This is a boon for the company’s bottom line and your team’s overall productivity.

Important: The bonus amount from this incentive program can vary significantly from year to year, depending on the company’s profit margin. 

During years with lower profit, it’s important to communicate this to your team so they’re not hurt or confused by changes in their year-end bonuses.

Team-building days

Does your office offer team-building activities to help coworkers get to know each other better?

While you may not consider it an employee incentive program, being intentional about employee bonding and fun at the workplace is a very desirable workplace culture practice. It can improve team motivation, engagement, and camaraderie.

Team-building activities are a great way to help your team break away from work, boost morale, and enhance employee collaboration. 

Often run on a monthly or quarterly schedule, some common examples of team-building activities you can try include:

• Group volunteering days

• An activity day (like recreational sports or leisure games)

• Escape rooms

• Paint nights

• Office scavenger hunts

If you’re interested in implementing one or more employee incentive programs, you’ll need to take steps to ensure the rollout is smooth and successful.

Get the most out of your investment and improve your team’s motivation and engagement by following these employee incentive program best practices:

Define your goals upfront

Before arbitrarily selecting employee incentive programs that sound good on paper, think about your desired outcome. Here are some questions to consider:

• Is your company looking to inspire or reward greater levels of performance? 

• Are you looking for ways to reward your long-term employees? 

• Do you want to improve the chances of landing high-quality talent?

In a brainstorming session, we recommend creating a list of goals and desired outcomes you hope your incentive programs will produce. 

This time is a great opportunity to discuss your work culture and employee population to determine what will inspire and motivate them.

From here, you’ll better understand which employee incentive programs are best for your specific goals. Choosing and implementing these programs will become more seamless.

Run a cost analysis

Next, determine how much you can invest in employee incentive programs before you overcommit and overspend.

To run a successful cost analysis, we recommend collecting data like:

• A rough estimate of the amount of resources you have to invest in incentive programs

• The number of employees you need to provide the benefits for

• Estimated amount of resources to facilitate the incentive programs you’ve chosen

From here, you can work with upper management to determine which choices make the most sense financially. This allows you to select the options that fit your budget and provide benefits to your team.

Ask for employee input

Asking for employee input is a great way to ensure you pick incentive programs that align with your organization’s goals and your employees’ wants.

Use an employee survey for feedback on possible incentive options. You could also host an all-hands meeting if you have a smaller team. 

Example questions for collecting helpful data include:

• Rate the following incentive programs from one to five, with one being the program you are most motivated by and five being the least interesting.

• Which of the following incentive programs would you like to see the company implement? (Select all that apply)

• Do you have additional ideas for employee incentive programs that we haven’t mentioned? Write your answers below.

Monitor and adjust as you go

Finally, like any new initiative, there will be some bumps in the road as you implement a new employee incentive program.

Going into this process knowing that you will need to make adjustments can be incredibly helpful. Additionally, a quarterly or biannual check-in to measure the success of your incentive program will be essential.

Anything new takes time to become its final form. Be patient, listen to feedback, and make necessary changes as they come.

Is your company doing enough to support your employees with benefits, perks, and recognition? If not, you’re likely risking the quality and reputation of your brand. That’s where employee incentive programs can help.

The best talent wants to work at companies that inspire and motivate them. Employee incentive programs mean you can position your brand as a must-work-at company. You’ll be known for your great products and strong workplace culture.

We hope this article acts as a helpful guide if you’re committing more resources to supporting your employees. Ultimately, investing in your team is always good money spent.