The buzzword in the HR town is ‘employee engagement.’ Employers are trying their best to keep employees motivated and earn their trust and loyalty as they’ve understood the financial link 🖇️ between revenues, employee engagement, and performance. 🎯
With this in mind, organizations are using several methods to motivate employees. These include a good mix of monetary and non-monetary benefits.
Let’s go through the list of the top non-financial and financial incentives to motivate employees that you can use too. 👍
💵 What Are Financial Incentives?
Financial incentives are nothing but monetary rewards, such as bonus payouts, salary hikes, and other financial benefits that employees receive for their dedication and hard work. 💷
These incentives are tangible and act as a direct motivation for employees. You can also view them as a form of compensation that goes beyond the regular paycheck and is linked with the performance of the company and the individual.
🏠 What Are Non-Financial Incentives?
Non-financial incentives are non-monetary benefits that an employee receives for their performance. Like financial rewards, this is not a part of the salary package and it’s above and beyond that.
Broadly speaking, things like recognition, reward, opportunity, and flexibility ⏰ fall under the category of non-financial incentives. Some examples include awards, vouchers, gift cards, remote working arrangements, paid training and mentorship programs, and so on.
Now you’ve got a brief idea, let’s delve deeper into the top financial and non-financial incentives to motivate employees.
🔝 Top 10 Financial And Non-Financial Incentives To Motivate Employees
Now that we know what monetary and non-monetary incentives entail, let’s understand the top examples under each category.
5 financial incentives to motivate employees
The workplace uses the following common financial incentives to motivate employees:
1. 💰 Bonus payouts
One of the most regularly used incentives to motivate employees is bonus payouts. They’re offered as a lump sum or as part of the employee paycheck. It’s an excellent way to appreciate employees, recognize their important milestones such as a work anniversary, or retain/attract new hires.
2. 📈 Stock options
Another tool for rewarding employees is offering them stock. This allows team members to earn profits by owning company stock at a subsidized or pre-set rate and gain part-ownership of the organization.
3. 💹 Profit shares
Profit sharing is another popular method to appreciate employees and a way to give them a financial advantage over and above their salaries. In this category, employers give a percentage of the organization’s profit to the employees as a way to motivate them.
4. 🏖️ Retirement benefits
Retirement benefits are a great way to financially reward your employees and help them stay secure in the long term.
Think of schemes such as the NPS wherein both the employee and employer contribute or pool in a certain amount per month during the employee’s tenure at the organization, and the employee can utilize the sum accrued post-retirement.
5. 💸 Salary hikes
Salary hikes are a sure-shot way to make sure employees are motivated and enhance job satisfaction. Employers must offer competitive salary raises in line with market standards and even consider offering salary corrections for those who were hired under par in terms of pay.
5 Non-Financial Incentives To Motivate Employees
Now that we have gone over the top financial incentives, let’s look into the following non-financial incentives to motivate employees.
1. ⌚ Flexible working
One of the biggest perks you can offer your employees is the ability to work remotely or flexibly. It enables employers to show that they trust their team members and also induces a mutual level of trust and appreciation from the employees.
2. 🏥 Employee health programs
Investing in employee health and wellness can reap great results for the company’s performance. To show appreciation for your employees, you can offer wellness sessions, mental health counseling support, gym membership subsidies, and so on. This way, you can employees healthy as well as happy.
3. 🎗️ Peer recognition
Words of gratitude can go a long way. As part of the company’s incentive program, employers can use peer recognition to make employees feel motivated. Further, you can use various ways to show recognition towards the team, such as public recognition, online recognition, and so on.
4. 🌴 Paid time off
If employees don’t get enough time to recuperate and look after their personal lives, it can affect their performance. To avoid this, you can consider offering paid time off to your staff. This comes over and above the sick leave program and aims to ensure enough time to rest, relax and recharge.
5. 📚 Professional development avenues
Another great addition to the incentive plan is the provision of professional development opportunities to employees. You can introduce this in the form of additional responsibilities at work, higher education programs, paid training, mentorship programs, and so on.
💭 How Well Can Financial Incentives Affect Employee Motivation And Morale?
Providing financial incentives can greatly impact the morale of employees. Depending on the nature of the business, different motivators have different effects on the performance of employees. 🎯
GOOD TO KNOW: 10 Easy And Efficient Ways To Increase Morale At Work
Generally speaking, financial incentives are a tangible and direct form of motivation that can positively enhance employee morale, and in turn, enhance company revenues as well.
At the same time, though, don’t overlook or ignore the importance of non-financial incentives. Non-monetary rewards, such as remote working and paid time off time and again, have been shown to have an excellent impact on employee engagement.
🎯 Improve Employee Performance With Loop’s Health Offerings
As an employer, you have an ocean of choices when it comes to financial and non-financial incentives that you can offer your employees. However, there is no bigger reward than that of health.
Recognizing this, Loop has created a wide range of health offerings that help you ensure the best of employee health and to keep them motivated in the long run.
Our comprehensive health insurance plans feature employee benefits such as unlimited care, complimentary wellness sessions, round-the-clock mental health support, and more. To get started with our group health insurance plans, get in touch with us right now.