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Comprehensive Guide To Different Types Of Employee Awards

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Comprehensive Guide To Different Types Of Employee Awards

The importance of rewarding and recognizing employees in a proper and timely manner is well understood by most organizations today. Deciding on the types of awards and their criteria is critical to designing the employee rewards and recognition program.

What Is The Basis For Classification Of Employee Awards?

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There are many ways that awards can be classified:

A. Who is being given the award?

1. Individual

2. Team

B. Who is giving/recommending the award?

1. Peers/ Colleagues

2. Manager/ Supervisor

C. What is the reason or criteria for giving the award?

1. Performance or Achievements

2. Behaviors or Values

3. Tenure

Organizations need to be aware of the different types of awards.

They should be able to choose the ones that are most relevant to their business goals and culture.

This would help them to maximize employee engagement and motivation.

Here are the most common types of rewards prevalent in modern organizations:

A. Who Is Being Given The Award?

Categories based on who is being given the award

1. Individual Awards

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Despite the focus of most organizations on teamwork and collaboration, individual awards still play an important role in every rewards and recognition program

Individual awards are here to stay, whether it is about appreciating employees for accomplishing a challenging task, displaying exemplary behavior, or taking the initiative.

2. Team Awards

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With increasing focus on teamwork and collaboration, it is not surprising that team awards are increasingly growing in importance in rewards and recognition programs.

Team awards are critical in building a united and dedicated workforce committed to fulfilling common business objectives.

There are many variants of team awards based on the type of team being rewarded or recognized:

2.1 Project Team Awards

Project Teams, whether cross-functional or part of a single function are often rewarded for completing critical and complex projects in time, within budget, or overachieving in the project’s goals.

2.2 Functional Team Awards

Enabling or Support Functions play critical roles within an organization, most often silently behind the scenes.

These functions include HR, Administration and Facilities, Finance and Accounting, Internal IT, etc.

They enable the business to run smoothly and take up challenging tasks related to changes in business strategy, policies, and processes.

2.3 Branch Awards

It is common for large business organizations to operate through branch offices, outlets, or independent units.

Such organizations need to recognize the performance and the efforts of teams working in these branch offices or business units.

This is even more critical if these branches or units are geographically dispersed – the teams working there need to feel valued and an integral part of the organization.

B. Who Is Giving/ Recommending The Award?

1. Manager Rewards/ Recognition

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This method of rewarding or recognizing employees is the most common and traditionally preferred by organizations.

Managers, supervisors, or team leads typically nominate or recommend their team members for different awards.

The manager might also decide on whether a particular employee should get the award or simply recommend to the next level manager with the details required for assessment.

2. Peer-to-Peer Recognition

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This type of recognition has been gaining much popularity over the past several years, as it is considered to be highly transparent, democratic, and effective.

This method of recognition empowers co-workers to reward and recognize the efforts, achievements, and even the specific behavior of employees.

Though recommended by a co-worker, the final decision-making might still rest with the management.

However, there is a growing prevalence of direct peer-to-peer recognition without the intervention of any manager, which makes the process extremely effective.

C. What Are The Criteria For Giving The Award?

Comprehensive Guide to Different Types of Employee Awards

1. Performance or Achievement based Awards


As the name suggests, performance, achievement, or impact-based awards aim to reward and recognize the results of the work or efforts of an employee.

Hence, these rewards are completely work-centric and are decided based on the contribution of the employee towards the business.

These awards are also referred to as business impact awards as they directly affect the growth and profitability of the organization.

These can be further categorized into sub-types based on the business metrics impacted:

Performance or Achievement based Awards
1.1 Spot Awards
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Spot Award is a catch-all term for recognizing any kind of exemplary performance ranging from a good client presentation to a task completed before time.

The key element of Spot Awards is that it is done immediately following the achievement by the employee.

Typically, though the achievement might have a business impact, it might not be measurable in terms of a business metric.

For impact on specific business metrics, there could be other award types. 

1.2 Sales/ Growth Awards
Targeted Recognition

These awards are typically given for overachieving on sales/ revenue targets for a month, quarter, or the entire year.

1.3 Customer Acquisition Awards

Organizations might reward employees for bringing in new customers – based on either the number of customers or certain key customers.

1.4 Customer Retention Awards

These awards are typically given to those employees who have played a key role in retaining key customers or winning back customers under challenging circumstances.

Hence, recognizing the efforts to retain a customer is as important as recognizing efforts to bring in new customers.

1.5 Profitability/ Cost Saving Awards

Organizations should recognize employees who have helped the organization save costs and improve margins either through process improvement or cost engineering.

1.6 Project Awards

Completion of a challenging project in time and with the desired (or more than the desired) results should be recognized.

1.7 Special Initiatives Awards

Employees could be recognized for participating in or undertaking special initiatives that might not be directly related to their area of work or key performance areas.

These could include employee engagement activities, representing the organization in an external event such as sports, culture, community service, or thought leadership.

2. Behavior or Value-Based Awards

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Recognizing employees for demonstrating specific behaviors or values is an effective way to keep them engaged and motivated besides promoting these desirable traits among the other members of the workforce.

These awards unlike the performance based awards are not for specific achievements but for consistent display of certain behavioral traits over some time through multiple achievements, small or big.

These awards go a long way in building a positive work environment and aligning employees to the organization’s value system.

A few such awards are as follows:

2. Behavior or Value-Based Awards
2.1 Customer Centricity Awards

This is a highly desirable trait sought by all organizations in their employees.

Employees who are always focused on ensuring the happiness and satisfaction of the customers at all costs deserve such awards.

Their efforts make a huge difference in enhancing the organization’s topline and growth.

2.2 Innovation Awards

Innovative and creative employees simplify complex tasks and processes, save costs, develop or improve products and services, come up with newer ways to reach out to customers interestingly and excitingly, etc. 

Hence, rewarding such employees is critical for business growth and competitive advantage.

2.3 Process Excellence Awards

This category might seem to be overlapping with the Innovation Awards.

However, these awards are focused on process improvements; especially repetitive processes leading to higher efficiency, lower error rate, higher productivity, and eventually lower costs.

Typically, successful Lean and Six Sigma projects may be under the ambit of these awards.

2.4 Leadership Awards

Every organization needs to have a talent pool of potential leaders for succession planning.

Leadership awards are designed to recognize upcoming leadership talent in the organization and give them higher visibility within the organization.

2.5 People Management Awards

The efficient management of people is essential for building a highly, motivated and satisfied workforce.

So, organizations need to reward and recognize the efforts of their line managers and supervisors who manage their teams effectively and coach and mentor their team members to perform better.

 2.6 Learning and Development Awards

Continuous learning and development are essential for ensuring the personal and professional growth of employees as well as driving business growth.

Learning and Development Awards are instituted to reward and recognize those employees who contribute to training programs, sharing their knowledge and training others to supplement the effort of the full-time trainers in the organization.

2.7 Honesty and Integrity
2.8 Commitment and Ownership
2.8 Collaboration and Support

3. Tenure-Based Awards

Event-based Employee Recognition

Most organizations put a lot of emphasis on retaining their best employees.

Hence, it has become extremely important for organizations to appreciate and reward their most loyal employees.

They also need to recognize the efforts of the new hires as it sets the tone for their continued performance and longevity in the organization

Tenure-based awards consist mainly of the following types:

Tenure-Based Awards
3.1 New Talent Awards

Most organizations hire a large pool of fresh talent, but only a few of these new hires show the potential to become successful professionals.

New talent awards are a great way of motivating them and paving the way for them to take up bigger responsibilities in the future.

3.2 Long Service Awards

Rewarding employees when they have attained specific tenure milestones is a way of thanking them for their contribution and making them feel valued by the organization.

Awarding employees on the completion of three, five, ten, fifteen years, and so on with the organization provides organizations with a means to express their gratitude for the loyalty and contribution of these employees.

Important Facts To Consider While Deciding On The Types Of Awards

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There are some important facts that organizations need to consider in deciding on the most appropriate award types for employee rewards and recognition programs.

The following are a few pointers:

1. Frequency of Award

Most experts think that organizations should reward and recognize their employees as frequently as possible.

Therefore, organizations should decide on their reward schedules based on the size of their workforce, their budgets, the profile of the employees, and most importantly, the business outcomes desired.

They can thus choose to reward them instantly or even monthly, quarterly, or annually based on the above factors.

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2. Value of Award

In addition to the frequency of rewards, organizations also need to consider the most appropriate method for rewarding the employees.

They can choose from a wide range of options in this context including intrinsic and extrinsic awards, monetary and non-monetary awards, and tangible and non-tangible rewards.

3. Decision-making Process

Also, another important aspect that organizations need to consider is the way the awards are decided.

They need to decide whether to follow a more top-down approach, a peer-based approach, or use a reward and recognition panel or committee.

Hence, the transparency of the decision-making process impacts the credibility and fairness of these awards.


There is no ‘one-size-fit-all’ solution to deciding on the most suitable types of awards for an organization.  It is the ‘horses-for-courses’ approach that works best – a combination of different award types to fit different situations within the organization.

Sagar Chaudhuri

Lead author: Sagar Chaudhuri, the Co-Founder and CEO of HiFives. He is an HR Tech Evangelist with over 25 years of experience in the corporate world and entrepreneurship. In the past, Sagar has worked with companies such as Genpact, Infosys, and ICICI Bank, in leadership roles. He has an engineering degree from IIT Kharagpur and an MBA from IIM Lucknow. Connect on LinkedIn

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HiFives is a global employee rewards, recognition and engagement SaaS platform that enables organizations to digitize, automate and transform their employee experience. It is used by 100+ large enterprises, small businesses and startups in manufacturing, retail, technology, financial services and media, across 25+ countries.