Employee engagement in the U.S. is starting to improve. In early 2024, it hit an 11-year low. It has since risen by two points to 32%, according to Gallup. That’s progress, but 68% of workers are disengaged or are checked out. That’s a big worry for HR leaders.
The good news? Engagement can be improved. One of the best ways to do that is through employee recognition. Gallup found that employees are four times more likely to be engaged when they feel recognized.
That’s where an employee rewards program comes in.
A rewards program is a way to thank employees for their great work. It can include points, praise, badges, or gifts. But a good rewards program does more than say “thanks.”
A rewards program motivates. It helps people feel valued and connected to their work. The result? Happier teams, better performance.
This article shows HR leaders how to build a successful employee rewards program that works. You’ll learn how to make it fair, thoughtful, and aligned with your company values.
Why Employee Rewards Matter Today
Employee rewards are more important than ever. They help teams feel appreciated and connected. When employees feel valued, morale and performance go up.
But rewards shouldn’t be one-size-fits-all. Every team is different. What motivates one person might not work for another.
Companies have to recognize that different generations may respond to certain rewards differently. For example, younger employees might value flexible work. Others may want learning opportunities or praise from a manager. That’s why flexibility is key.
A people-first rewards program lets employees choose what matters most to them. This makes rewards feel real and personal. It also helps build a culture of true appreciation.
Offering a variety of rewards is a great way to start. Give employees the power to choose. When people feel recognized in a way that suits them, they’re more likely to stay engaged and do their best work.
Types of Rewards
Employee rewards today include both monetary and non-monetary options:
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Monetary rewards are bonuses, raises, cash, or gift cards.
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Non-monetary rewards include public praise, time off, or new learning opportunities.
The best programs mix both. They make employee recognition personal and timely.
But recognition is about more than the reward—it’s about the meaning behind it. Gallup’s Human-Centered Workplace report says people do their best work when they feel seen and appreciated.
When people feel supported, they thrive. And so does the business.
Modern rewards programs are also smarter. Many companies now use employee rewards and recognition program platforms that personalize employee recognition at scale.
These tools let coworkers give shoutouts and track points. Some employee rewards tools include wellness options and other diverse perks.
In short, a good rewards program is about building a better workplace. It’s one of the simplest and most powerful ways to show people they matter.
Current Trends in Employee Rewards
Today’s rewards are about people, not just perks. Top trends include personalization, automation, and well-being. These trends help teams feel seen, supported, and motivated.
For example, 72% of Vitality employees said employee rewards inspired healthier habits and positive lifestyle changes.
Here are other trends that help incentivize employees:
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Personalized Rewards: 66% of workers prefer personal rewards over generic ones. Give people options like flexible work, unique gifts, or custom experiences.
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Automated Employee Recognition: Employee recognition software automates your recognition efforts to keep engagement high while reducing manual effort. Tools like Applauz make it easy to deliver personalized, instant recognition
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Well-being in the Workplace: More companies are taking a human-centric approach to employee recognition with wellness-related rewards. Wellness perks include app subscriptions or mindfulness workshops to help reduce burnout.
The Business Case for Employee Rewards
Employee incentive programs aren't just a nice-to-have—it's a smart move.
It helps you hire top talent. People want to feel appreciated at work. When they do, they’re more likely to choose your company.
Rewards also help you keep your best people. For example, companies with strong recognition programs have 31% less turnover. That means less time and money spent replacing team members.
And there’s more. Rewards boost engagement and productivity, too. 85% of companies with recognition programs say they see higher employee engagement.
To sum up, employee rewards aren’t just perks. They build loyalty, lift morale, and help your team do great work. And that means better results for your business.
Types of Employee Rewards
Employee reward types all support different goals. For example, some rewards boost employee motivation. Others help you keep top talent. The best part? You can mix and match rewards to fit your team and goals.
Popular types of employee rewards include:
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Monetary Rewards: Includes bonuses, raises, gift cards, or spot awards. These rewards are great for direct employee motivation and recognizing high performance.
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Recognition-Based Rewards: These rewards focus on praise and acknowledgment. You can reward employees publicly or privately.
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Experience Rewards: Includes extra time off, team outings, concert tickets, or special work perks that create memorable, morale-boosting experiences.
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Professional Development: Offers learning opportunities like courses, certifications, or conference passes. These rewards help employees grow their skills and careers.
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Team-Based vs. Individual Rewards: Team rewards encourage collaboration and collective success. Individual rewards highlight personal achievements and accountability.
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Wellness-Based Rewards: Includes gym memberships, wellness stipends, or mindfulness apps that support employees’ mental and physical well-being.
Building an Employee Rewards Program
A great rewards program is about building a culture of recognition. Start with the company culture you want.
Regular employee recognition strengthens company culture, boosts performance, and helps your team feel seen and appreciated. Recognition should feel fair, simple, and meaningful.
Here’s how to build a program that drives real results:
1. Set Clear Goals
Start by defining what you want the program to achieve. Are you looking to improve employee engagement? Reduce turnover? Reinforce your company values?
Once you know the “why,” connect your rewards to behaviors that support your business goals.
For example, if teamwork matters, reward collaboration. If service is a focus, recognize employees who go the extra mile for customers.
2. Set a Realistic Budget
Next, decide what you can spend. Use a mix of cash and non-cash rewards to stay flexible. Bonuses and gift cards are useful, but non-cash options like praise, learning programs, or time off can be just as powerful.
Even small gestures—like a public shoutout, employee appreciation day, or an extra break—can make a big difference.
3. Pick the Right Employee Rewards Tool
Once you’ve set your goals and budget, pick a platform that fits your needs. Look for something that’s easy to use and lets you recognize employees in real time.
The best tools include flexible reward types, customizable catalogs, automated workflows, and real-time reporting. These features help you stay on budget and see what’s working.
Applauz makes rewarding employees easy. It helps you run your rewards strategy smoothly with tools that fit your culture.
Applauz Key Benefits
Custom Perks
The Applauz Perks catalog is designed to reflect your unique company culture, offering customizable rewards that feel personal and purposeful. From wellness benefits and learning opportunities to branded gear and time off, these perks help you recognize employees in ways that matter.
You can set point values, control availability, and coordinate fulfillment with managers. This gives flexibility to align rewards with business priorities while boosting team motivation.
Rewards Marketplace
The Applauz Rewards Marketplace allows you to tailor your employee rewards and recognition program to fit your company’s preferences and program objectives. It provides access to over 30,000 products across several categories, including
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Vacations and travel
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Merchandise
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Experiential
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Tickets and events
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Gift cards
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Charity
By offering employees a wide range of options, you give them the freedom to choose rewards that matter to them. This creates a more appealing program to engage employees.
Analytics
Applauz provides real-time analytics and reporting tools that help you monitor employee engagement and track the performance of your rewards program.
These insights also allow you to manage your budget more effectively by tracking point distribution and redemption trends.
You can also spot engagement shifts across teams and identify key contributors. This way, it’s easier to fine-tune your strategy and recognize the people who make the biggest impact.
4. Communicate and Launch
Once you’ve set up your employee rewards software, it’s time to introduce your employee rewards and recognition program to your leadership team!
Firstly, ensure they understand its value and are prepared to lead by example. Then, roll it out company-wide with clear communication about how it works and how employees can participate.
Gather feedback with quick pulse surveys to keep your employee rewards program fresh. Ongoing feedback helps you spot what’s working. This way, you can make continuous improvements based on real employee input.
Follow these steps to create a rewards program that recognizes employee contributions and drives engagement. All while supporting your company's objectives.
Measuring the Impact and Success of Your Employee Rewards Program
To know if your employee rewards program is working, track a few key metrics: engagement, retention, and productivity.
Watch how often people use the program. Look at participation rates and how many rewards get claimed. These numbers show how active and useful the program is.
Get employee feedback often. Use quick surveys or pulse checks to learn what’s working and what’s not. This helps you see if the rewards match what employees want and value.
Make small changes based on this feedback. If people suggest new reward ideas or say something isn’t helpful, adjust the program. This keeps it fresh and meaningful.
Over time, these insights will help you build a rewards program that truly connects with your team and supports your goals. A program that listens, evolves, and delivers real impact will always drive better results.
An Employee Rewards Program Success Story: Vitality Insurance
To understand the real-world value of employee rewards programs, let's look at a real-life scenario of a company putting these strategies into action.
One strong example is Vitality. Here's how their approach delivered measurable impact across their workforce.
Case Study: Vitality Provides Rewards for Healthier Living and a Healthier Workforce
Vitality’s rewards are all about wellness. They offer on-site health checks, mental health support, lifestyle coaching, and activity-based incentives. Their rewards are all tied to five key pillars of wellness.
Employees get points for making healthy choices. And it works.
72% of participants made positive lifestyle changes. Sick days dropped by 28%. Recovery time sped up by 46%
The takeaway? Targeted rewards can change behavior and build a better workplace.
Unlocking the Power of Employee Rewards for Success
Want to boost engagement, keep great people, and improve performance? Start with an employee rewards program.
Companies that align rewards with their values and goals can more easily motivate employees and create a productive workforce.
When done right, rewards programs align with company values to improve employee satisfaction. Rewarding employees can also boost engagement and contribute to improved productivity.
When people feel seen and appreciated, company culture improves. A positive company culture = long-term success.
The result? Happy, committed teams who drive better performance and amazing business outcomes.
Create a rewards program that’s aligned with your business goals and drives measurable results. Try Applauz today.