HRM Rewards and recognition:
Recognizing the efforts of employees and rewarding them is an effective step towards encouraging and motivating them to perform better.
It is rightly said that a motivated and dedicated employee may bring good results to the company and can change their fate. Framing and practicing a reward system needs proper evaluation and should comply with the company’s policies.
Types of rewards:
Rewards of the company should be according to its objectives, mission, and vision. Monetary and non-monetary rewards boost the morale of the employee and they devote more to their organization.
Monetary rewards: Family vacations, festive bonuses, gifts, increase in salary, coupons, movie tickets, come under these benefits.
Non-Monetary Rewards: It includes rewards based on personal interest (gym memberships, etc.) certificates, provides a day-off, flexible working arrangements, etc.
To ensure a proper reward system, there should be a mixture of monetary and non-monetary rewards. A proper reward and recognition system leads to friendly relations between the managers and employees.
One of the key components of this flexible payment plan is the methodology of relating pay to performance. This procedure has been practiced by numerous global organizations worldwide and comprises of the total pay structure being separated into components.
The global practice is to build the component of the variable pay more than the hierarchy. This would express that at senior dimensions of the employee chain of importance, the variable segment can be as high as 50-60% of the general pay.