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The lowdown on long service awards and recognition

May 07, 2020 Employee rewards  |   Rewards strategy

Even though the definition of ‘long service’ has shortened considerably from days gone by, there is still plenty of value in recognising tenure and important career achievements.

Here's what you need to know about long service awards and recognition in 2020 and beyond. 

Does your company award length of service? Rewards and recognition based on tenure are a great way to show your employees they matter, but not every business gets it right. Some choose arbitrary rewards on the fly, others fail to achieve any recognisable form of excitement surrounding these recognition initiatives, and others fail so badly that it actually leads to a level of cringe.

However, when employee service awards are done well, it can be the perfect opportunity to celebrate friendships, highlight shared successes and improve employee experience, all at the same time. Here are a few other amazing benefits of properly executed long service rewards:

Decreased levels of employee churn. In 2018, 47% of the 22 000 young South African professionals surveyed by Universum in their annual research  move from their current employers, with an average job satisfaction level of 6 out of 10. This is bad for a number of reasons – aside from the initial costs of recruitment and training, other impacts of regular employee churn include lost productivity during handover, low employee morale and the negative image of a high turnover rate. Length of service awards are an effective way to make employees feel appreciated and improve overall retention. 

Improved employee engagement. Employee engagement should be top of mind for every business that wants to thrive in 2020 and beyond. Statistics show that highly engaged teams show a 21% greater profitability, and that for a 1% increase in employee engagement, you can expect to see an additional 0.6% growth in sales for an organisation.

Disengaged workers, on the other hand, have 37% higher levels of absenteeism and commit 60% more errors. Companies with low engagement scores also suffer from 18% less productivity. According to an employee online poll conducted by Wyzetalk among 2 410 South African respondents in 2019, modern-day employees expect to be engaged differently and  organisations need to focus on employee experience to drive engagement. It all starts with regular, visible recognition.

Facilitates peer-to-peer inspiration. Years of service awards aren't only effective at engaging the employees who receive them - the simple act of observing a peer being celebrated for their contribution to the company can inspire other employees at the same time.

Highligts important aspects of company culture. Companies like Microsoft, Vodacom Group Limited, Accenture (South Africa) (Pty) Ltd and the rest of the winning businesses that have been named as Africa's Top Employers for 2020 by the Top Employers Institute understand that a well-defined company culture is vital if you wish to remain competitive and attract top talent in the current talent economy. When a business uses long service rewards and recognition to show their employees that they are valued, this serves to foster a culture of appreciation, gratitude and acknowledgment.

In short, the benefits of employee service awards are too many to be ignored. This brings us to the next question - how do you effectively recognise length of service? Here are five best practices to get you started:

1. Stick to the actual date as closely as possible. Timely recognition of length of service  is key if you want the award  to be effective. Keep managers informed of upcoming anniversaries and provide them with a few presentation tips and celebration guidelines.

2. Understand that different milestones = different emotions. In year one, you should celebrate learning, after three years the focus is normally on growth and development. After five years, expertise should be highlighted, while ten-year anniversaries showcase an employee's role in the growth of the organisation, etc. As the years go by, your choice of reward should ideally reflect the emotions associated with each particular milestone.

Read more: 5 tips for managing and motivating a multigenerational workforce

3. Make sure the moment is memorable. Make sure that the presentation of the service award is memorable by focusing on the employee in question's individual accomplishments and celebrating their unique qualities. Tie this back  to your company's mission, goals and overall culture to drive the message home in a way that corresponds with your business objectives. Managers may need some training in this regard.

4. Give your employees a choice in the matter. Every employee is different, which also means that they will respond differently to the rewards you offer. Ideally, you want to give them the option of choosing their reward. This can include everything from reward experiences, to leisure / sport items, travel accessories, luxury spoils, books, vouchers or lunch with the CEO.

Did you know that long service awards taken in the form of cash or monetary incentives are taxable according to the Income Tax Act no. 58 of 1962. Remember to make this clear if you choose to give your employees the option of taking cash as a service reward.

5. Integrate your efforts with an ongoing recognition strategy. Don’t let your long service awards be a standalone effort that gets lost in the noise of the everyday hustle and bustle. Weave it into an ongoing recognition strategy to drive home the message of appreciation on a regular basis.

Keeping all this in mind when you re-evaluate long service awards at your company will allow you to make the most of this important employee recognition opportunity. Feel free to get in touch with the GET Rewards team if you want some more expert insight on the matter. We're here to help you reward your customers, channel partners and employees in ways that lead to deeper engagement and lasting loyalty.


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