Reimagine Your Benefits With These 15 Fresh Employee Incentive Programs

Employee incentives are any type of employer-sponsored program designed to benefit your workers in some way. Are they the same as employee perks and benefits? While there’s some overlap, incentives aren’t a standard part of compensation. Instead, they’re an additional reward for reaching certain goals or exhibiting desired behavior. 

This guide explores how employee incentive programs work and 15 top employee incentive ideas for inspiration. 

Why are employee incentives important?

You’re already offering a competitive salary and a robust employee benefits package, but here’s why you should sprinkle incentives into the mix: 

Attracting top talent 

Employee incentives form an integral part of your company culture, uniting workers toward common personal and professional goals. The enthusiasm can be infectious, making your company a magnet for job seekers. At the same time, incentives can also prevent your best employees from jumping ship. They demonstrate that you value and invest in your workers, which makes them less likely to seek out other opportunities. 

Boosting employee morale 

Employees who know their employer cares about them and wants them to do well are happier, more engaged and productive. Incentives make them feel recognized and appreciated for their hard work and achievements. 

Fostering a healthy competitive spirit 

Healthy competition can drive employees to perform at their best, all while fostering teamwork and camaraderie. Incentives prompt workers to go above and beyond, pushing themselves and their colleagues to achieve more. 

15 innovative employee incentive programs

The following employee incentives are divided into category themes according to your goals: 

Financial incentives

There are many non-monetary ways to move your workers toward positive action. But money does talk, so if you have room in your budget, the following could be fantastic extrinsic incentives for your employees: 

1. Performance-based bonuses 

Performance-based bonuses are a classic form of employee incentives and for a good reason. They tie monetary rewards to specific metrics and goals, outlining exactly what employees need to achieve to receive their bonus. 

2. Profit-sharing programs 

Profit-sharing programs give employees a percentage of the company’s profits on top of their salary. It’s a great way to persuade workers to continue contributing to the company’s success, and a helpful employee retention tool, too.

3. Stock options 

Similar to profit-sharing, employee stock ownership plans allow employees to own a portion of the company. This gives them a vested interest in the company’s success and can also serve as a long-term incentive.

Wellness incentives

8 in 10 employees admit to being more productive at work when they’re healthy and happy. At its core, that’s what wellness is all about. Employers can achieve this in their workers by offering the following types of employee incentive program: 

4. Gym memberships 

A typical gym membership costs between $40 and $70 per month, according to GoodRX health data, which may be prohibitive for some workers who need to prioritize paying their monthly utility bills or put away savings. Employers who pay this cost remove a substantial financial burden and encourage employees to stay fit and healthy. 

5. Health insurance contributions 

1 in 4 U.S. adults report that they or a household member has experienced difficulty paying for healthcare in the past year. Employers can support their workers by contributing toward their medical coverage, helping to alleviate financial stress and promote overall well-being. 

Companies can choose from a range of models, such as: 

• Healthcare Reimbursement Arrangements (HRA): This type of health plan is employer-funded and allows employees to use pre-tax dollars to cover eligible healthcare expenses. Employers set the HRA contribution limit, which can vary between different plans. 
• Health Savings Accounts (HSA): These are similar to HRAs, but the employee owns the account and can also contribute pre-tax money from their paycheck. Funds roll over every year and accumulate interest tax-free until withdrawal for medical expenses. 
• Flexible Spending Accounts (FSA): These allow employees to put aside a portion of their pre-tax income into an account that they can use to pay for eligible healthcare expenses. Unlike HSAs, funds do not roll over every year and must be used by the end of the plan year. 

6. Wellness challenges 

Wellness challenges and competitions are a fun way to promote healthy habits among your employees. Employers can set them up as individual challenges where the employee competes only against themselves, for example, if they want to reach a particular weight loss target by a set date. Alternatively, you might set up a team challenge to spark competitive spirit among peers, such as a step challenge where teams compete to reach the most steps in a week. 

Remember: An effective employee incentive program will be truly inclusive. For example, if your employees include a mix of fitness levels, don't set up challenges that reward the most active. Instead, focus on progress made by each individual or team rather than absolute numbers. 

Work-life balance incentives

Employees burning the candles at both ends might produce short-term productivity gains for your business. But over the long-term the only results you’ll achieve are burnout and disengagement. Consider the following employee incentive plans to foster a healthy work-life balance for your workers:  

7. Flexible work arrangements 

Flexible work arrangements, such as remote work, job sharing, or selecting their own hours give employees more control over where and how they work. This is important for 88% of employees who value schedule flexibility as a work arrangement.  

8. Unlimited paid time off 

The promise of rest and relaxation on tap can be a great incentive for employees to remain with your company and work their hardest. And crucially, being paid for this time off means your workers don’t have to worry about how to pay their bills as they recharge.

9. Sabbaticals 

While most PTO focuses on vacation or various types of personal leave, sabbaticals offer space for employees to pursue personal or professional development opportunities, which could include travel, volunteering, or learning new skills. These are effective employee incentive programs for workers with long tenure; for example, if someone has been with the company for 10 years, you might offer a 3-month paid sabbatical. 

Professional development incentives

Helping employees develop in their careers is one of the top priorities for L&D professionals in 2024, up nine positions from the previous year, according to LinkedIn research. The following employee incentives encourage your workers to keep upskilling, growing, and adapting to new technologies and ways of working:  

10. Tuition reimbursement

Organizations can support workers with the cost of tuition by offering a professional development stipend or reimbursement model. With the stipend model, employers provide a set monthly or annual sum for employees to spend on their professional growth, perhaps paying for courses, books, or coaching. The reimbursement model is less convenient, typically requiring employees to front the cost of their development and then file an expense claim to receive the money back. 

11. Costs to attend conferences 

Another way to encourage professional development is by offering financial support for employees to attend industry conferences, trade shows, or other events. Attendees can learn from leading figures in the field and connect with peers to stimulate creativity and ideas. 

12. Mentorship programs 

Establishing mentoring partnerships between seasoned professionals and junior employees can accelerate career growth and learning. Mentors can provide guidance, offer insights into their industry, and act as sounding boards for ideas and challenges. And in return, even experienced professionals can benefit from fresh perspectives and new ideas. 

Recognition and awards

Praise and gratitude for contributions at work support employee engagement and motivation. When this is missing, workers who are never recognized are 27% more likely to seek a new job. Keep your staff happy and rewarded by introducing the following incentives: 

13. Employee awards 

Employee of the Month, Salesperson of the Quarter, or Best Team are all examples of workplace awards you can motivate your team members with.  You might set up an award and invite team members to nominate each other to win. Whatever your award type, communicate transparent criteria with your employees to explain exactly what someone must do to win. This way prevents bias from creeping into your incentive programs. 

14. Peer recognition programs 

Peer recognition programs allow team members to acknowledge their colleagues’ contributions. You might use a digital program or select a vehicle like a wall of fame or kudos board to celebrate your fellow team members. By doing so, this promotes a culture of appreciation and support, encouraging employees to recognize each other’s hard work and dedication. 

15. Service awards 

Your longest-serving workers deserve recognition for their commitment to your company. Whether they’ve completed 5, 10, 15, or more than 20 years of service, reward employees generously for reaching their milestone achievement. You might promote their profile on your social media pages or provide them with a meaningful gift or financial bonus to express your gratitude. 

How to tailor incentives to your company’s needs

We’ve thrown a bunch of employee incentive ideas at you, so the next step is to select the ones you feel drawn to and customize them to your needs. Follow these steps: 

Understand your employees’ values

There’s no point dangling the wrong carrots in front of your workers. Avoid frustration, disappointment, and a waste of resources by finding out what makes your team members tick. Survey them to discover what they care about most and use the data to design incentives that appeal to their interests.

Align incentives with company goals 

Make sure you’re incentivizing behaviors that will benefit your overall business in some way. For example, if you want to increase sales, offer bonuses or awards for meeting specific sales targets. If you’re concerned about employee retention, provide incentives that encourage loyalty and recognize longevity with your company.

Measure the effectiveness of incentives

Give your incentive program time to settle, then track its progress toward your chosen goals. The SMART framework is useful here, as it helps you set Specific, Measurable, Achievable, Relevant, and Time-bound targets for your rewards program. An example would be increasing sales by 20% in the next quarter by offering a monthly team lunch for hitting specific targets. You’ll track sales figures to understand if you hit the desired 20% gain, then take corrective action if you miss the mark.

Create meaningful employee incentives with Benepass

Benepass offers a versatile, people-first platform that incentivizes employees to work hard for your business while staying balanced in their personal lives. We offer a full range of pre-and post-tax benefits, including: 

• Wellness benefits 
• Professional development benefits 
• Lifestyle spending accounts 
• Food benefits 
• Benepass Rewards and Recognition program 

Ready to see our top-rated platform in action? Book a free Benepass demo or contact sales@getbenepass.com to connect with a benefits specialist.