The Complete Guide to Employee Recognition

Today, HeyTaco is initiating you into the world of employee recognition. Outside of fair compensation, employee recognition is the most extensively researched and verified way to improve engagement.

It helps create the type of work culture where cost savings are just a bonus.

In this guide

• What is employee recognition?
• What are the benefits of employee recognition?
• What are the different types of employee recognition?
• How do you make employee recognition meaningful?
• What are some examples of employee recognition?
• 11 genuinely considerate ways to recognize employees (budget-friendly and remote options)
• How to recognize employee birthdays
• How to celebrate employee work anniversaries
• Employee recognition programs: Best practices for sustained results
• How to measure the success of a peer recognition program
• Case Study: Employee recognition boosts engagement in a medical residency program
• Launch an employee recognition program in two free, simple steps with HeyTaco.
• Employee recognition FAQ

What is employee recognition?

Recognized employees report:

• Feeling appreciated for their contributions, even very small ones.
• Engaging more deeply with their work, feeling motivated to perform.
• Building more trust with teammates, improving collaboration.

Many misunderstand recognition as a showy gesture or a serious award. Instead, it's a practice that creates an environment where people do their best work. Where being thankful and encouraging isn't awkward or out-of-place. It's just part of the culture.

What are the benefits of employee recognition?

Consistent, authentic employee recognition efforts lead to higher engagement, motivation, and total job satisfaction. It helps companies retain talent in a positive working environment. Research finds that:

• Employees who receive recognition are 45% less likely to leave their jobs.
• Recognition makes employees five times more likely to feel valued.
• Feeling valued makes someone six times more likely to feel invested in their role.
• Increasing recognition is associated with a significant rise in performance.

Moreover, it leads to better business outcomes. Fostering engagement through methods such as employee recognition programs is associated with:

• 23% higher profitability.
• 15% more sales productivity.
• 10% higher customer loyalty.

After studying thousands of recognition moments across teams, one pattern keeps showing up. The strongest cultures do not treat recognition as a program. They make it part of daily work.

Doug Dosberg, Founder of HeyTaco

---

What are the different types of employee recognition?

You can break down recognition types in a few different ways, from the method or channel used to the people or purpose. The following categories are most useful to organizations looking to build an employee recognition program.

What's the best type of employee recognition?

Peer-to-peer recognition is more effective than manager-only or strictly top-down because it captures contributions that leaders may not see. It's also generally received as more authentic and inclusive.

All recognition works best when it is frequent, shared openly, and tied to real work. HeyTaco emphasizes peer recognition, but also offers strong support for top-down recognition, rewards, and milestone recognition.

---

How do you make employee recognition meaningful?

First, what does it mean to make anything meaningful? Meaning adds purpose. Meaningful things also involve feelings that may not be expressed directly. Here's how we turn a rote, routine “thanks” into something with greater meaning and impact.

1. Be specific.

Call out the behavior, and if warranted, the impact. Recognition is saying, “Thanks for your help!” Meaningful recognition says, “Thanks for helping me debug that issue, you saved my afternoon.”

2. Be timely.

Life's happier moments are just that—moments. Recognition is most powerful and natural when it happens ASAP. Build on positive actions with positive words.

3. Tie it to values.

Connect the behavior to your company's principles when possible.

Creativity, customer care, persistence, excellence, inclusion, etc. No matter the value, recognition helps reinforce it.

4. Make it personal.

People aren't looking for others to apply an overly “nice” affectation or pile on compliments. Using someone's name and delivering it the way they would prefer (public shout-out versus handwritten note) is much kinder.

5. Keep it consistent.

Daily habits matter more than once-a-year awards. Research indicates that employees should be receiving recognition at least once a week. Peer recognition tools can help organizations bump this up.

---

What are some examples of employee recognition?

Employee recognition takes many forms. Team celebrations, thank-you notes, peer praise, and public shoutouts are some of the most effective. Here are some examples of each:

---

11 genuinely considerate ways to recognize employees (budget-friendly and remote options)

Building a culture of recognition is like becoming a cyclist. Buying the bike helps. But it's learning to ride and persisting through challenges that matter most. The intention and effort we put into workplace happiness far outweigh what we spend.

1. Give people a platform where they can give and receive recognition.

First, employees need the means to increase peer-to-peer engagement. There are plenty of tools out there to choose from, but this is what HeyTaco is all about.

One standout quality our users note is how much easier and lighthearted recognition is with HeyTaco. This removes concerns about virtual recognition being awkward or inauthentic.

2. Let them have a say.

Anonymous and public ways to offer feedback should be clearly defined and easy to use. What makes this effective is following up and acting on feedback to the best of an organization's ability. Giving someone a voice is about as real as recognition can get.

If possible, leaders can also invite employees to help them make decisions that involve them. What tools they introduce, how they'll phase a project, and other details that impact their days.

3. Make Employee Appreciation Day extra meaningful.

Don't forget the first Friday of March. Employee Appreciation Day is a key date to ensure everyone receives top-down recognition.

If you don't regularly offer job flexibility or gifts, this is a great day to make an exception. It'll stand out as extra-special, and every employee will enjoy equitable amounts of appreciation.

4. Compress a workweek or offer flexible scheduling.

Employees working hard to meet deadlines or other milestones will appreciate more free time in between. Float the idea of adding more hours to the workday to extend the weekend.

Other forms of flexible scheduling let people choose their start and finish times. For example, employees can start the day any time between 8 am and 10 am. Everyone works the same amount of time, just in the timeframe of their choosing. This lets them enjoy their ideal morning or evening routines for personalized work-life balance.

5. Increase collaboration and autonomy.

We're not suggesting dry promotions, where people get greater responsibilities without more compensation. Rather, break up the routine with projects and initiatives that encourage growth.

Tweak someone's role or title to emphasize their strengths. Let them design their own processes. Assign special projects that involve collaboration across departments. This type of recognition can kickstart a new era of productivity, connection, and innovation.

6. Offer time off for volunteering.

Open up more PTO for charitable activities. This is especially effective for companies that count social consciousness among their core values.

It demonstrates that the company is true to its mission and that its employees are its valued representatives of the cause. Global teams enjoy Tacos for Charity as a collaborative reward where teams experience the joy of giving together.

7. Take the time to write thoughtful appreciation messages.

Timely, specific, sincere. These are the three qualities a highly motivational message of recognition has.

When you spot a great attitude, willingness to help, or anyone going the extra mile, write or send them a message expressing why it matters and how grateful you are. It's simple, free, and has emotional staying power.

8. Celebrate entire teams and invite peer nominations.

Employee of the Month is one way to recognize people, but it's not inclusive. Employees frequently see this award as biased or unfair. So instead of choosing one “winner,” give more people a bigger spotlight monthly, for a variety of reasons.

It demonstrates appreciation for a wider range of great qualities, not just performance. It ensures more people get a turn. Take it further by including an honoree or two who were nominated by their peers. This can reveal who is boosting morale, championing values, and helping out the most behind the scenes.

9. Create an employee recognition wall.

An employee recognition wall is a designated virtual or physical area spotlighting team members daily. Praise performance and let employees share their gratitude.

Have team members collaborate on themes and rotate segments regularly. Throwback photos, pet spotlights, quote-sharing, top 10 lists, and more help keep it fresh.

10. Introduce a companywide Day of Play.

Gaming tournaments, outdoor activities, and social events. In-person teams can designate one warm-weather date as your company's Day of Play. Remote teams can use it to mark the end of a big project or challenging transition period.

It's an essential reminder that everyone is part of a community. Plus, research indicates that employees who engage in forms of play (even virtually) enjoy higher team performance.

11. Have them design and collaborate on culture-building content.

Let employees get creative with company colors and logos for water bottles, hoodies, and other branded merch. This way, you know you're spending on swag that employees approve of and use with pride.

On top of getting to share their creativity, employees will get a rush of good morale from being trusted with the task. You can also invite them to edit the team newsletter or make company TikToks. They can collaborate on a holiday recipe book, playlists, and other culture-defining content.

---

How to recognize employee birthdays

Why is it important to acknowledge personal milestones? Employees want to be seen and valued as humans and not just workers. Birthdays are one way we can celebrate the person, not the performer.

Our guide to employee birthdays shares more research and information on why this is important. The ideas below can help plan employee birthdays that are appropriate in scale and budget and genuine in sentiment.

Write a personal, meaningful birthday message.

Handwritten inside a card is best. Ensure the message is all about the recipient and their birthday-no work-related topics. The exception would be if they have made significant progress or achieved a major milestone since their last birthday.

Mention what you appreciate about them as a human, too. Everyone likes a reminder that they're funny or smart!

Pair the greeting card with a gift card.

Gift cards in modest denominations are ideal for birthdays because we can keep it consistent. No employee's birthday should exceed the cost of another's.

Where it can be redeemed may differ. Personalize this common gift by associating it with what they enjoy-fitness, gaming, food delivery, or just a little shopping.

Spark team involvement.

Employee surveys show that people like celebrating their coworkers' birthdays more than their own. Virtual work has made it more difficult to gather in the break room for cake. Enter HeyTaco's Milestones feature.

These customizable, automated birthday messages make a timely appearance in the team chat. This way, no one's birthday goes unnoticed. More importantly, it gives everyone else a heads-up so they can pile on the well-wishes. One automated message provokes a flurry of peer recognition.

---

How to celebrate employee work anniversaries

Work anniversaries are key milestones because they commemorate loyalty and commitment. Poor recognition or no recognition on this day may stand out more than others.

Like birthdays, HeyTaco's Milestones feature is a great way to start a wave of acknowledgement. Here are some other ideas from our work anniversary guide to let people know their dedication makes a difference.

Make a video or a presentation.

Employees with a longer tenure may appreciate a retrospective of their time at the company. Edit a video or slideshow recalling their biggest achievements. Have team members share their favorite memories or what they appreciate most about their coworker.

Enjoy team-wide celebrations.

Games, trivia, happy hour, or a Zoom talent show. Hybrid and in-person teams alike love creating rituals around activities. Add fun, low-pressure celebrations, and everyone will look forward to them. Community happiness makes the occasion that much more positive for the individual.

Invent a new award dedicated to their best qualities.

A plaque or trophy may be right for the long-tenured employee with a more traditional take on appreciation (think Gen X or Baby Boomer generations). However, bring it up to date by making it meaningful. Add their name to the Innovation Prize, or, if their presence is especially unwavering, to the Solid as a Rock Award.

Let them pick a gift.

Don't just drop them a link to a corporate catalog, though. Curate a gift gallery of experiential, tangible, and non-monetary anniversary rewards. A day off, a subscription service, premium parking, or local event tickets.

---

Employee recognition programs: Best practices for sustained results

Building a successful recognition program is never one-size-fits-all, set-and-forget. It requires constant attention, innovation, and redirection. That doesn’t mean it has to be difficult.

Use these tips to help build momentum and make recognition feel real and natural.

Encourage daily micro-recognition.

Small, meaningful thank-yous add up to a greater sum than many organizations realize. Making this a habit is the core challenge, not finding budget for presents and parties.

Integrate it into workflows.

At least some component of the program should fit seamlessly into the tech stack. For hybrid and remote teams, it's non-negotiable. People need ways to acknowledge each other that aren't disruptive.

Mix public and private recognition.

All one-on-one recognition can feel like a secret. All-public recognition feels like it's just for show. Include both for best results.

If adding rewards, go non-monetary.

Transactional recognition doesn't have the same impact because it's not genuine. Monetary rewards are good for short-term performance. Non-monetary rewards are for long-term engagement.

Let feedback inform the program.

Employees are used to taking surveys and being assured their feedback is welcome. Make it worth their time by asking questions about recognition and using their responses to actually make changes.

Use gamification or rituals where possible.

Culturally relevant team rituals reinforce workplace belonging through appreciation. Gamification makes recognition feel easy, fun, and low-pressure.

Back recognition up with analytics so leaders see the impact.

Lack of leadership buy-in is a main cause of failed recognition programs. Use any reduction in absenteeism or indicators of stronger engagement to keep efforts moving forward.

---

How to measure the success of a peer recognition program

If employees are the primary drivers of recognition, how do we tell how well it's working? Here's what to know about measuring the impact of peer recognition:

• Recognition frequency. Weekly and monthly figures for how often recognition occurs.
• Engagement rates. The percentage of employees participating in recognition, with unique senders and receivers.
• Sentiment analysis. Check the quality of recognition exchanged for meaning and specificity.
• Employee satisfaction and retention. Look for changes in retention rates and use pulse surveys to measure satisfaction.
• Team performance. Have project completion or customer satisfaction rates increased?
• Recognition distribution. It's key to identify departments and individuals who may be going unrecognized.
• ROI. Compare peer recognition spending to cost savings from increased performance or retention.