Non-financial rewards can be a very effective way to boost employee loyalty, says Teresa Campbell.
Recruitment is almost always a costly business for employers. Hiring, training and developing employees takes time and money. So, when you have invested in putting a team together, it makes sense to think about what you can do to boost employee loyalty.
Many business owners worry that they cannot offer sufficiently attractive bonuses and pay rises to hold on to their best performers. It is true that in a competitive market there will always be opportunities for good people to move on. So, if money is the only motivator, the chances are you will lose your best people over time. However, non-financial rewards are increasingly important in today’s market. By taking the time to identify and implement appropriate reward structures, you can boost employee loyalty, saving your business time and money in the long run.
When your employees have autonomy in their roles and see that you recognise and value their contribution, this in itself boosts loyalty. Other non-financial rewards to consider include:
• Development opportunities such as training, mentoring, project work
• Flexibility for employees to vary their start/finish times or to work from home if appropriate
• Support for professional subscriptions or membership fees
• Tax saving schemes for annual or monthly bus/rail travel passes
• Cycle to work schemes
• Staff discounts
• Volunteering opportunities which allow employees to give back to their local community
• Help with education or exam fees
• Provision of occasional experience-type rewards such as family days out
• Support for personal skills development
• Support for sporting activities
• Provision of medical check ups
• Use of company vehicle
• Extra annual leave
• Long service rewards
Before deciding to provide non-financial rewards it is important to consider the potential tax impact. This is because failing to structure your rewards correctly could result in a tax liability for you or your employees. For some rewards, tax incentives may be available.
Keep in mind
Hiring the right people at the outset will save you time and money in the longer term. Hire for the role, the team and the organisation. Think about your leadership style bearing in mind that recognition of individual contributions is often the key to securing employee loyalty. (In previous blog posts, Feargal McCormack has discussed how to get people to buy in to your vision, and how to set meaningful goals and measure performance). Finally, remember that your employees play a key role in helping your business develop and grow and that when the time comes for you to exit, having a loyal team in place is often a key selling point.
If you found this article useful and would like more information and/or advice, please contact our business advisory team.
Teresa Campbell l Director