Implement staff incentive schemes

Setting up an incentive scheme for employees

Remember that pay and financial benefits are not the only motivators for staff performance. Other key motivators include job security, job satisfaction, good working conditions and appropriate training.

Steps to setting up an incentive scheme

An incentive scheme is perhaps the most straightforward way to motivate staff:

• Identify the scheme's objectives. These can be considered in a number of ways. It might be desirable to encourage the recruitment or retention of staff, to change the organisational structure of the workplace or to reduce any likely areas of conflict. Alternatively, it might be preferable to encourage teamwork and motivation or to set specific productivity/financial targets.
• Consult with staff and trade unions on where incentives should be aimed, eg the entire business, managers, or groups of workers, what incentives or perks your staff would value most, and the training required for what is expected of your staff.
• Relate the scheme to the business' remuneration system. Should the incentive be financial or non-financial? Think also about how the proposed incentive will relate to other payment benefits and what effect such a scheme might have administratively.
• Ensure that the planned scheme is competitive. Look at similar schemes within other businesses and establish likely tax implications for your staff whilst strongly considering related costs and funding.
• Decide on performance measures for your staff, eg performance targets, quality of work and length of service.
• Run a pilot scheme and evaluate results - see the page in this guide on ensuring the incentive scheme is successful.
• Regularly review your scheme and obtain feedback. Make sure that you document, communicate and obtain feedback from staff at all times.

You can also consider commercial providers of benefits packages who, for a fee, can manage the scheme for you.

Subjects covered in this guide

• Introduction
• The benefits of staff incentive schemes
• Incentive schemes and the options
• Perks and the options
• Setting up an incentive scheme for employees
• Ensuring the incentive scheme is successful
• Here's how a staff incentive scheme improved our business

 

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