2. REWARDS AND RECOGNITION

3. Introduction

4. Reward & Recognition External Data Recognition Program in Place? 84% 87% Nearly 9 out of 10 companies offer some sort of recognition programs for employees Reward and Recognition programs are generally less expensive than base pay, benefits, stock options and bonus 3 20062007 Cnbc survey -2008

5. The Four Elements P O R T raise pportunity hank you espect

6. PROGRAM PURPOSES Recognize individuals and teams in a timely and effective way. Provide a continuum of opportunities to acknowledge and recognize members of the organization. Recognize that each individual can make a difference. Be a fair and flexible practice that is woven into the fabric of the org culture.

7.  Reward refers to all of the monetary, non-monetary and psychological payments that an organization provides for its employees in exchange for the work they perform.  Reward (or compensation) management is a core facet of the employment relationship.  An organization can provide two types of reward: extrinsic and intrinsic.  The mix of extrinsic and intrinsic rewards provided by the employer is termed the reward system, the monetary or economic element of the reward system is termed the pay system. The Nature of Reward system

8. Reward objectives Any organizational reward system has three behavioral objectives: 1. membership behavior to recruit and retain a sufficient number of qualified workers 2. task behavior to motivate employees to perform to the fullest extent of their capabilities 3. compliance behaviour to encourage employees to follow workplace rules and undertake special behaviours beneficial to the organizations without direct supervision or instructions. A MODEL OF REWARDS SYSTEM

14. Benefits + Reward and Recognition + Variable Pay + Base Pay = Total Rewards Total Rewards Components

15. R&R Overview 14 Base Pay Bonus BenefitsEquity Rewards & Recognition Top objectives for R & R programs include motivating high performance, reinforcing desired behaviors and creating a positive work environment. R & R programs have grown over the years from informal “thank you’s” to plans with a written strategy and more defined budget.

16. What is Recognition? “Recognition is any thought, word, or deed towards making someone feel appreciated for who they are and recognized for what they do.” 1 “Recognition can be a strategic tool for shaping behavior and moving an organization in a desired direction.” 2 “Recognition is something a manager should be doing all the time—it’s a running dialogue with people.” 3 15

17. Why Focus on Recognition? –Employees identify recognition as one of the most effective motivators 1 –Even small increases in supportive practices are associated with decreased turnover and increased sales/profitability 2 –Employees who feel that their organization values them are more likely to value their customers 2 –Appreciation and/or praise are among the top three drivers of employee motivation and engagement across a variety of industries and companies 3 16

18. 17 Recognition in General To Recognize is to Acknowledge, Praise, Encourage Immediate- handwritten note fine Simple- thanks on back of business card Timed well- right after stressful period Public- share with boss Personal- give credit,use name,spend time Celebratory- potluck, retreat Sincere- heart felt

19. Evidence from Best Employer Studies Best Employers around the globe have cultures that emphasize recognition In the US: Fortune’s 100 Best Companies to Work For All of the 100 Best Companies recognize employees’ outstanding performance or service using special awards and programs 50 Best Companies to Work for in Canada Best companies in Canada have people practices that communicate and reinforce the organization’s culture and values, including recognition of outstanding performance Hewitt Associates 18

21. Recognition types Peer Recognition Formal Recognition

22. Program design by staff Nominations from staff Award selection by committee Limited involvement of administration Design Goal: Peer Recognition

23. Awards Ceremony. Citation, certificate and cash award. Luncheon. Pictures on webpage,magazines. Design Goal: Formal Recognition

25. 24 Achievements Recognized by Fortune’s 100 Best Companies to Work For Percent of Companies

26. 25 Awards Used by Fortune’s 100 Best Companies to Work For Percent of Companies

27. Reward & recognition approach – outcomes Reduced level of employee turnover – down to 10% on average; Reduced levels of sickness absence being sustained per yr. Improved recruitment into HR practises; Reduced business mileage due to travel for work plans being integrated into reward strategy; Improved employee satisfaction levels: 73% satisfied; (Source: Ipsos MORI 2007 Survey - compared to 62% LA / public sector comparators and 63% overall). Improved employee advocacy about the Council as an employer: 50% speak highly; (Source Ipsos MORI 2007 Survey - compared to 33% LA / 41% overall). Satisfaction with reward and benefits (excluding salary): 67% satisfied; (Source Ipsos MORI 2007 Survey – compared to 58 % LA/public sector and 58% overall).

28. Future Reward and recognition Challenges Implementing Annual Total Reward Statements, delivered via e-business suite; Implementing more ‘flex’ in the benefits offering and enhancing the choice for individual employees, e.g. trading salary for extra holidays, benefits package for ‘carers’ and not just childcare; Increasing the level of workforce knowledge and skills around reward by offering financial education for the workforce in partnership with the Financial Services Authority Renewed focus on internal communication and manager role in the ‘reward relationship’; Changing the nature of our reward delivery with the implementation of a Shared Service joint venture; Doing it all within tighter resource constraints!

29. 28 Reward and Recognition Program Design What? Why? Characteristics of a Successful Program Plan Design Steps Best Practices Examples

30. 29 Trends and Best Practices Rewarding teams and individual Realization that some employees value recognition as much as merit increases and bonuses Employees recognizing employees Greater use of informal/spontaneous awards Improved publicity of winners Biggest obstacle to success: Communication Management support

31. 30 Characteristics of Successful Programs Senior management support and involvement Include employees/managers in design and implementation Keep programs simple and easy to administer Tailor rewards to individual interests, needs, desire Match the reward to the achievement Communicate, Communicate, Communicate! Be timely and specific Make sure each employee understands what they did to earn the reward