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What Benefits Does an Employee Years of Service Recognition Program Offer?

by | Feb 16, 2021

What Benefits Does an Employee Years of Service Recognition Program Offer?

by | Feb 16, 2021

Recognition shared on days of significant milestones, make employees feel valued and appreciated. It helps them experience an increased sense of engagement and loyalty to your company.

 

It is important to understand that your employees exchange their time for work that helps your organization succeed. It is very clear that companies have to dedicate resources to increase employee retention and engagement. The cost is too high to not do anything as your best talent packs up and moves on to organizations that will show them the love.

 

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Your employees’ dedication deserves recognition on a regular, timely basis. The best way to do this is by implementing employee years of service award program. When effective, they are a way of increasing employee engagement.

Service awards programs show recognition and appreciation. It recognises your employees’ commitment to your company as well as their performance. Commemorating work anniversaries is one of the most popular types of service awards programs. Recognition shared on days of significant milestones, make employees feel valued and appreciated. Helping them experience an increased sense of engagement and loyalty to your company.

 

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It is important to recognise employees for the quality of their work and appreciation for their years of service. The fact is that any significant length of service represents a major investment by an employee from their life. This choice of investment is something to value. Especially when there is a high employee ‘churn’ (and cost of turnover) these days compared with the past.

 

A joint survey conducted by the Society for Human Resource Management and Globoforce revealed several key findings regarding service awards programs. The survey found that 74% of companies say they have some sort of service anniversary program. Yet, just 22% of these companies say their program is excellent, with 31% rating it as fair or poor. The survey found that the number one reason companies have years of service awards programs is to appreciate employees.

 

How Can you Strengthen Your Service Awards Program?

 

Before starting your service awards program, or revising your current one, find out what your employees think. Polls and simple email surveys are effective ways to get an idea of how workers feel about the programs. With this data, you can then create programs that is more closely aligned with employee desires.

How Much Should You Budget?

 

The SHRM/Globoforce survey found that the most effective recognition programs used more than 1% of payroll. It is wise to think about budgets as the recipient. If you were to receive an award for 5 years valued at $50, you would calculate that you are worth $10 per year to your employer. Similarly, a 20-year award valued at $150 is calculated at $7.50 per year. Remember that employees are not unintelligent.

They WILL make these calculations to determine how much you value them.

The lesson here is “Don’t Skimp” on recognising employees.

 

Which Employee Anniversaries Should be Recognised?

 

Traditionally, companies celebrate major milestones like 5, 10 20 and 25 Years. But it is also important to celebrate smaller ones. In today’s employment market individuals stay at companies for shorter periods of time a trend called ‘Job Hopping’.

But the SHRM/Globoforce survey found that:

  • 90% of companies celebrated five-year anniversaries.
  • 92% celebrated 10 years.
  • 89% celebrated 20 years.
  • 28% celebrate first year anniversaries.

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What worked yesterday does not work today. Traditionally, employee service awards were awarded starting at 5 years of service, and every 5 years thereafter. For employees aged 25-34, the average tenure is 2.8 years. These stats render the 5-year starting milestone obsolete. Today’s service awards programs often start after the first year. Great companies are starting employee recognition on day 1 followed up by formal recognition 1 year, and 2 years.

Understand that the public and social activities of recognition are what will have the highest impact. During these early years of recognition, it is imperative to let younger tenured employees know that they are valued.

For organizations just getting started with service awards, don’t forget to “grandfather” employees into your new service awards program. Don’t forget your 6-year and 11-year employees! Even your 11-year employees should receive service awards they have earned and accumulated! This will mean an increased budget for the first year of your service awards program.

Whenever possible, a service award should be accompanied by a face-to-face presentation where the recipient can be acknowledged for his or her contributions. Award presentations can be group events or one-on-one presentations with the employee’s manager. At a minimum, group award presentations should take place once a year.

 

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Avoid using cash or gift cards for service awards. Regardless of the intentions, cash awards signify compensation by employees. Most spend the money then forgot the value. A meaningful service award should serve as a lasting reminder of significant achievement.

Research shows that service awards programs are a meaningful and powerful way to recognise employees. Not only do these programs boost employee morale but have long-term positive effects on the organization as a whole.

Lasercraft Australia has specialised in assisting Companies and Government to recognise employees for over 30 years. Let us use our expertise to help you with your employee recognition program.