Non-Monetary Rewards in the Workplace

Published: 2021-07-01 08:53:12
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Category: Motivation, Money, Workplace

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Managers of different industries and organizations have been finding ways to create a motivational workplace. Defining motivation, it is “that which gives impetus to our behavior by arousing, sustaining, and directing it toward the attainment of goals” (Wortman and Loftus, 1992 p.353). In order for a business organization to achieve its objectives, therefore, there should be some motivations in the workplace that will drive its employees to accomplish such objectives.
Companies may aim to improve the quality and productivity of the business primarily for increased profitability. Personally, employees may have their own motivators that drive them to perform their jobs better. Older employees are motivated by the insurance and pensions they will get upon retirement while others are motivated by the increase in salary as the years of their stay in the company increases.
What makes motivation very important is that when it has been very effective, the business and its workers will mutually benefit; that is they will both achieve their goals. For businesses, turn over rate will decrease and productivity may increase. What also makes it a hard task for the managers is that employees have different behaviors and attitudes towards work, thus different motivations are needed in order to satisfy the employees.

The most common type of motivation is reward. Rewards are given to motivate employees to improve their performance or simply to avoid dissatisfaction among employees. Rewards may be monetary or non-monetary. The purpose of monetary rewards is to acknowledge employees’ excellent job through money. Money has been an effective motivator because people are motivated first by the desire to secure first-level needs of food and shelter for survival (Creech, 1995). Aside from that, one of the primary reasons why people work is to earn money and improve their economic status. Monetary rewards or incentives include salary increase, profit sharing, project bonuses, stock options and warrants, scheduled bonuses and additional paid vacation time (Ballentine et al, 2003 p.1).
However, people’s needs are not only material things. There are also other needs that are needed to be satisfied such as the need to learn, to be challenged, to improve skills, improve social status, and the need for other opportunities. These needs are basically what make people self satisfied and fulfilled.
Non-Monetary Rewards
Non-monetary rewards are important employee motivators. As many people say, there are certain things that money cannot buy and these are sometimes more important to people. According to Kohn (1993 on Ballentine et al, 2003), monetary incentives encourage compliance rather than risk-taking because most rewards are based only on performance. On the other hand, non-monetary rewards are recognition of an excellent job which do not involve money but are still satisfying and motivating to employees with the purpose of creating opportunities to the employees.
Non-monetary rewards include:

opportunity to learn, develop and advance as an employee;
flexible hours;
the opportunity to contribute;
independence and autonomy (Anonymous, 2006).

Opportunity to Learn, Develop and Advance
The opportunity to learn, develop and advance can be considered as opportunity for growth. Creech (1995) describes growth as to the mental abilities of employees. Promotion is one means of growth but there are also other ways that employees can learn and grow aside from moving out of their current position. Training, for example, are provided to employees who have showed exemplary performance. Some companies even send their employees abroad for special seminars and trainings to further enhance their skills while other companies have provided scholarships and send their employees to universities to make them more educated.
Another way of rewarding an employee is by giving him more complex and challenging tasks that will help improve his skills giving employees a certain feeling of achievement.
Flexible Hours
Having flexible hours is rewarding to employees in such a way that they can have more time with other obligations. It will be rewarding for good employees if they can have time for other important things such as the family, a part-time job, hobbies and social life. Even the most dedicated employees may feel like slaves and may lose interest with their jobs if all their time will be spent working for the company alone but those who can have time for their selves can be more enthusiastic.
It is very important for an employee’s excellent job to be appreciated and recognized. Recognition as a reward should be earned directly through the job (Creech, 1995) and must be in the form of merit so that employees know efforts are being observed and appreciated by management (Anonymous, 1994). Recognition may be in the form of “pat in the back”, verbal praise, or written praise (in the form of letter or certificate). There are even some companies that announce the reward publicly by holding ceremonies annually or quarterly in recognition of outstanding employees such as awards for the most prolific employees, the most loyal, most innovative and so on. In this way, employees are more motivated knowing that their good performances are recognized.
Opportunity to Contribute
Employees feel rewarded when they know that they have good contributions in the workplace. They can even more contribute to the organization when they are given more responsibilities and when they know that their contributions are being valued. This reward involves having to work in a team, working closely with the people in the upper level of the business organizations such as the management, and having your ideas being heard and considered with regards to the decisions made in the company. This kind of reward is commonly given to innovative and creative employees who always have new ideas to contribute to product development and productivity.
Independence and Autonomy
Exemplary employees are usually given the independence and autonomy because the management trusts them that can accomplish their jobs without supervision and help of others. This reward is commonly given to employees who are good in decision making, can handle pressure and can finish the job on time effectively. It is a rewarding and comfortable feeling for an employee when there is no supervisor or other employees that always looks after his works while employers can save time and money when they have workers who can work independently.
Although monetary rewards have been traditionally effective as a motivator in a workplace, non-monetary rewards are also important in meeting the other needs of the employees. Non-monetary rewards satisfy and eliminate unhappiness in the workplace by providing employee self-fulfillment, growth, and a feeling of achievement, making them more motivated to perform their jobs better. Therefore, in a workplace, there should be a balance of monetary and non-monetary rewards which motivates employees in different effective ways.

Anonymous (1994) Personnel Practices/Communications. Human Resources Management. Chicago: Commerce Clearing House Inc.,
Anonymous, Top Five Non Monetary Items Employees Want in a WorkplaceRetrieved online on October 12, 2006
Ballentine, Andrew, McKenzie, Nora, Wysocki, Allen & Kepner, Karl (2003),
The Role of Monetary and Non-Monetary Incentives in the Workplace as Influenced by Career Stage, EDIS, Department of Food and Resource Economics, Florida Cooperative Extension Service, University of Florida, Gainesville, FL.
Creech, Regina (1995), Employee Motivation,Management Quarterly, Volume 36, Issue 2 Wortman, Camille B. and Elizabeth F. Loftus. (1992) Psychology.
New York: McGraw-Hill, Inc.

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