Types of Employee Recognition: The Who, What, When, Where and Why

There are a million and one ways to recognize employees and no one-size-fits-all approach. That being said, some ways are better than others. Typically, organizations that are the most deliberate about their strategy are the ones that reap the benefits.

We wanted to break down the who, what, where, and when of employee recognition so you are set up to learn how to make frequent praise a part of your company culture which will help impact employee engagement. 

Who Gives Employee Recognition?

With employee acknowledgement, it’s important to understand who should give it out. Positive reinforcement can come from various directions, and the best programs utilize a wide range of opportunities. 

As a company, you need to decide how to make sure people are consistently being recognized and feeling valued. You should also consider how you can create a culture of recognition where everyone contributes to building a positive work environment. This will create a 360-approach to recognizing staff where everyone feels supported.

According to a recent Nectar survey on employee recognition, employees get value from recognition that comes from a variety of places. While manager recognition makes the most impact, getting feedback from company CEOs or peers has a profound impact on many employees.

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Let's discuss some of the ways that recognition shows up in the workplace in more detail:

Top-Down Recognition

One of the most common types of employee recognition is from the top down. This is the more traditional, centralized approach to recognizing and appreciating employees. There are two main types of top-down praise: manager-to-employee and company-to-employee.

Nandini Shenoy, Founder and CEO, Pinkvilla says, " Being appreciated by superiors is undoubtedly a satisfying feeling. A shoutout from the top level definitely motivates and encourages the employees to achieve great heights. We make sure to recognize outstanding performers periodically."

Manager-to-Employee Recognition

As a manager, you are connecting with the people on your team daily. You know the work they are putting in every day, and you are privy to all the small and large things employees do to move your company forward. Whether you are sending a thank you note to your employees or giving them a high-five in a meeting, your shout-out matters.

As a manager, you can also give powerful feedback and recognition to people who are not on your team. If you find yourself working cross-departmentally on a project, don’t be afraid to share your feedback with the employees you are working with (or their managers.) This will have a profound impact at work because you are a company leader.

If you’re doing your job as a leader, your opinion will count. Employees with good bosses are more productive, (in fact, good bosses can raise productivity by 50%) so continue to be a great manager and give praise when appropriate.

Company-to-Employee Recognition

Companies can also give powerful employee recognition. Whether you recognize a staff member as an Employee of the Month or give out awards at your yearly company-wide award ceremony. Most company-to-employee shout-outs are public and shared with the entire company. These awards can typically be added to resumés and make your employees look and feel appreciated.

The issue with this form of acknowledgment is that it can be so far and few between if companies aren’t careful. For example, a business can only give at most twelve Employee of the Month awards per year. End-of-the-year awards only happen once a year. Employees need timely and appropriate feedback, so this type of acknowledgment isn’t always the answer to your company’s engagement woes. Luckily, there are other options to fill in the gaps left by this outdated approach.

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Peer-to-Peer or Social Recognition

Another form of appreciation is called peer-to-peer. This form of recognition comes from everyone who works at your company. Managers might recognize one another, employees might praise someone else on their team, and so forth.

Peer recognition happens all the time, but companies often avoid investing in peer recognition programs. If you can make this type of praise more formalized, you can glean a lot of great feedback and intelligence from it.

Best practice: The best employee recognition programs take a 360-degree approach by incorporating both top-down and peer recognition.

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What Are the Main Types of Recognition and Rewards?

After you understand who gives recognition, the next step is to understand the different types of recognition and rewards you can give your employees as you build or implement your own program. This can come in many forms.

Structured Recognition

Structured recognition, like the name implies, is a very deliberate approach to recognizing and rewarding team members. Companies or managers are most likely to be in charge of this type of praise. Think of awards like Employee of the Month or awards given for years of service.

There are many benefits to structured awards. The main attraction is that these awards have a lot more weight to them. If someone wins an award like Employee of the Month or Employee of the Year, they’ll likely want to make a big deal out of it. Employees seek this kind of large-scale praise because they know that it truly validates their hard work.

Nicky Dutta, CEO at Lorel Diamonds, says, “A program to formalize peer recognition, like “Employee of the Month” or “Most Helpful Colleague,” helps foster a culture of appreciation. It’s also a good way to gather invaluable insights about team dynamics, individual strengths, and the collective pulse of the organization. Peer-to-peer recognition isn’t limited by hierarchy or titles - it’s about acknowledging the contribution of every team member, by every team member.”

On the other hand, structured recognition is scarce. For example, you can only make one person Employee of the Month every month. That gives you limited chances to recognize employees every year if that’s your only form of appreciation. Employees vying for that coveted spot will be frustrated if they are continually passed up for it.

Unstructured Recognition

So what’s the alternative (or addition) to structured recognition? Unstructured. An unstructured approach removes some of the unnecessary boundaries of traditional employee appreciation like Employee of the Month. Using peer-to-peer or even less official types of top-down recognition are all ways to accomplish this type.

For example, you can praise your team when they do something amazing without giving them a formal award for it. Your team members can recognize each other and build team camaraderie. Unstructured recognition comes in so many forms, and it all pulls the company forward.

The benefits are simple. You probably don’t need a huge budget to make it happen. This form of praise does need some money behind it, but you don’t have to throw any large galas or awards ceremonies at the end of the year. It’s also way more timely. Unstructured appreciation lets you celebrate in the moment versus every month, every year, or not at all.

This type of appreciation can be hard to manage if you are not careful. If all your employees are too busy dealing with their own work, they might forget to share positive feedback frequently enough. As a leader, you need to step up and ensure that your employees adequately recognize one another. Once you get the ball rolling on this type of program, it can be easy to maintain. Lead by example and ensure that you are practicing what you preach.

Verbal vs. Written Appreciation

If you are a boss, you might wonder how you can best give appreciation to your employees. Should you say it aloud or write it down? Chances are you’ll use a variety of approaches to handle how you give appreciation to your employees.

Verbal appreciation can be beneficial for sharing an appreciative thought in the moment. Many employees find value in a quick great job during a presentation or a quick speech about a job well done during a meeting, especially if they value words of affirmation. Verbal appreciation can be challenging for employers because it’s in the moment. There’s only so much reflection that can be done on something you heard in a meeting once.

Tim Connon, CEO of ParamountQuote, implemented a gift card reward system where managers and himself can reward top-performing agents. "If an agent does a great job consistently, management will walk to their desk and place a $50 or more gift card for local retailers on their desk and announce to them and the office how much they are appreciated. This highlights the agent's individual performance and gives them words of appreciation."

On the other hand, written appreciation can be valued for a long time to come. Taking the time to write and send out a thank you note to an employee is powerful. You don’t have to take a long time to create a handwritten note, but people often hang on to this type of appreciation. Some employees even collect these pieces of written acknowledgment to look back at when they feel down at work. Writing things down truly helps your employees build confidence and excitement for work.

Despite evidence that compliments can boost memory, learning, and motivation, people still underestimate the impact that kind words can have on others. “An easy way to strengthen your bond with colleagues is by offering thoughtful praise. Many of us have a terrible habit of staying silent when it comes to giving positive feedback, which is a missed opportunity for connection,” said Dr. Liz Kofman-Burns, a Ph.D. Sociologist and co-founder of DEIB firm, Peoplism.

Their framework for giving better compliments - dubbed Compliment Tic Tac Toe - consists of nine archetypes designed to get you thinking about traits you’re grateful for in others. Liz added: “If you’re reading this, I challenge you to carve out just 5 minutes of your day to send at least one person a compliment. Even if it’s only something small, praise can go a long way, but it’s most effective when given alongside concrete examples. Bonus points for giving three compliments in a line and completing Compliment Tic-Tac-Toe!”

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Employee Reward Examples

Employee rewards can vary. There are obviously some big ones like cash and gift cards, but the list is endless. Some rewards can even be free, and who doesn’t love that? When considering employee rewards, think about the types of rewards you can maintain as an organization. What can you afford to be responsible for giving out regularly?

Here are just a few examples of employee rewards to get your creative juices flowing:

• Gift cards
• Company swag
• Experiences
• Product catalogs
• Cash
• Trophies/Awards
• Free meals
• Features in company newsletters/social media

If you'd like more ideas, check out this extensive article on employee reward examples. 

Where Do You Give Your Employees Recognition?

The next part of the puzzle is where to give praise. There are so many different places to give out positive feedback, but how should you approach this subject?

Public Praise

Public praise is giving praise in a way for more than just the recipient to hear. For example, you may publicly recognize someone during a meeting or other company event.

According to Radical Candor, it’s a good idea to make sure that you praise in public and criticize privately. Your goal in sharing information about how your employee is doing is to lift everyone up. You should keep public criticism to a minimum or generalize it.

Public praise isn’t always easy for employees to absorb. If you have a timid employee, they may not enjoy public praise as much as you think they would. It’s important to get to know your employee and go with their flow—even if you want to shout from the rooftops about how amazing they are.

“We’ve had great success with public recognition during our monthly department-wide meetings. This is a big enough space for employees to feel proud of being recognized, yet not too big so that our more reserved and quiet employees don’t feel overwhelmed by this type of recognition. ” says Corey Donovan, President of Alta Technologies.

Private Praise

Private praise is the praise you give to someone one-on-one or behind closed doors. Private praise can be strategic and timely, which makes for a great experience for your employees. For example, if you are meeting one-on-one with an employee and they tell you about something awesome they did, you shouldn’t wait until you are in public to offer your praise and support.

Since some employees thrive on privacy and don’t enjoy public praise, you should make sure that you supplement those employees with more private praise. Even a quick Slack message letting them know they are doing an awesome job can work wonders. Giving regular private praise doesn’t have to be time consumptive.

"Private praise has a profound impact on employees as it takes the form of a personal and unique interaction, rather than a one-size-fits-all approach," explains Scott Winter, Co-Founder and CHRO at Agility PEO. "By recognizing the efforts of employees in a private setting, we are able to speak directly to their strengths and achievements, making them feel truly seen and valued. This fosters a culture of appreciation that drives engagement, productivity, and loyalty."

When Do You Give Recognition?

Last but not least, let’s talk about when to recognize and reward your people. A multi-threaded approach to employee appreciation is always best. Here are the main reasons and milestones that merit some positive reinforcement.

Allyson Hay, Director of Human Resources at Innovo Benefits Group, recommends that timely acknowledgment is vital to successful recognition. “There is greater impact when recognition happens soon after the employee has reached a goal or completed a challenging task.”

Jenna Nye, CEO of On The Strip, agrees. “The more quickly you recognize employees’ efforts or contributions, the more it matters to them. If too much time passes, employees might feel like the recognition is just an afterthought and it won’t have the same positive impact.” 

Performance-Based Recognition

As your employees set and crush their quarterly or yearly SMART goals, you’ll want to show your appreciation for their follow-through. Rewarding for performance is the perfect way to show your employees how much you care and appreciate them for doing their job well.

Examples:

• Project completion
• Goal achievement

Effort-Based Rewards

While performance-based recognition is impactful, you might think of it as related to longer-term goals. Effort-based rewards might be something that takes a smaller amount of effort. Instead of recognizing employees who meet a quarterly goal, you might recognize employees who you see putting in effort daily to reach their goals. It might be as simple as closing a multi-thousand dollar deal or helping their teammate with one of their projects.

Examples:

• Going above and beyond
• Helping train a new hire

“We always make it a point to publicly recognize employees who consistently help out their fellow colleagues. This is a great show of teamwork and we believe that by recognizing it, we’re not only thanking those employees for their above-and-beyond effort, but encouraging others to follow in their footsteps.” says Mark Pierce, CEO of Cloud Peak Law Group.

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Milestone-Based Recognition

Your employees are always accomplishing various milestones with your company from their first day to work anniversaries. You might also want to celebrate things like their birthdays. These milestones might not be as closely related to the work they do every day, but you should never miss a chance to show employees how much you care.

“In a remote world, you can provide creative ways to celebrate milestones. One idea is to provide a recommendation on the employee’s LinkedIn profile on their work anniversary. On Boss’ Day, my whole team went to LinkedIn and provided me recommendations. I absolutely loved it!” Jodi Brandstetter, Founder & HR Career Strategist, By Design Brainery.

Examples:

• Employee’s First Day
• Employee’s 90th Day
• Work Anniversaries 
• Birthday
• Employee Appreciation Day
• Quarterly Review
• Year-End Review
• Employee Service Awards

For more ideas, check out our article 30+ employee recognition examples & ideas.

Values-Based Recognition

If you are like many companies, you have core values that you care about deeply. One of the best parts about recognition is that you can tie it to your company values. This allows you to understand how your employees are living your values in their everyday lives.

Values-based appreciation programs can have a huge impact. 93 percent of employees in a Globoforce study said that work had more meaning when employers used a recognition program based on company values. Other ideas for boosting meaning at work were frequent management check-ins and building strong manager-employee relationships.

If you haven’t sat down to write out your company’s core values, we encourage you to get together as a team to define them. Then use a tool like Nectar to track these values across your company.

Best practice: Take a holistic approach by recognizing and rewarding employees on each of these occasions. The best way to consistently do this is through employee recognition software. If you’re building an internal program, make sure to account for each occasion in a systematic or automated way.

Once you understand the who, what, when, and where of employee recognition, it’s super simple to understand the last part of the equation: how to make employee recognition programs work at your organization. Consistently helping employees feel valued and engaged doesn’t have to be complicated. Creating a plan is a lot easier once you understand all the moving parts, though.

Employee appreciation is a challenging subject. Many companies shy away from employee recognition because they feel like they need thousands of dollars to do it justice. At Nectar, we understand that this topic can be sore for many startups (we based our entire product on creating a fair pricing model for companies of all sizes.)Whether you are new to employee appreciation or you want some fresh ideas, we’ve got you covered.

Employee Appreciation vs. Recognition: Is There a Difference?

While appreciation and recognition are often used interchangeably, it’s important to note that they have slightly different meanings. Appreciation is all about gratitude and admiration for someone. Recognition is about formal acknowledgment or giving special attention to something.

Often when we talk about employee recognition ideas, we highlight employees for something they’ve specifically done for our company. Employee appreciation is often more general. You show appreciation for the amazing things employees do for your organization every day. These ideas are great for appreciation, recognition, or any positive feedback you give to your employees.

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If you're ready to learn more about employee recognition, we have tons of resources on the Nectar blog. We have a:

• List of top employee recognition platforms on the market.
• Guide to help you understand what to look for when selecting employee recognition software.
• Blog detailing employee recognition and rewards insights we've gathered while working with our customers.

These articles will give you a crash course understanding of recognition platforms and how to use them effectively. So, if you're sold on the types of recognition available, use these resources to make this content actionable.