30 Great Ways to Reward Employees On a Budget

PERKS Editorial Team

PERKS Editorial Team


July 15, 2021

How to Reward Employees on a Budget

how to reward employees on a budget

Rewarding your employees is crucial for raising and motivating your top talent to stay. When employees feel recognized, they will be more engaged and less likely to take the day off or leave the company altogether. The good news for employers is that rewards don’t have to be expensive. In fact, many of the best rewards are free, and even the simple ones can make a huge difference for the employee’s productivity and mental health. 

Offering Employee Recognition

When a person receives recognition for excellence, oxytocin — the “love hormone” — is released in the brain and they feel happier and more connected to the team. According to bestselling author Dr. Gary Chapman, words of affirmation are one of the five ways in which we give and receive appreciation, making this kind of recognition especially powerful for employees for whom words are meaningful.

When an employee has exceeded expectations, has worked especially hard, or provides a valuable contribution day in and day out, thank them with any of the following ideas — they’re heartfelt and also 100% free.

  • Write them a thank-you card, note, or email.
  • Send a letter to their spouse and/or family.
  • Honor the employee with a shout-out in a staff email, company newsletter, or staff meeting.
  • Record a short video and share what you appreciate about the employee. Publish it in your intranet or Slack where everyone, even in a remote setting, can see it.
  • Arrange a standing ovation for the employee at the next staff or team meeting.
  • Arrange a thank you photo for the employee that is signed by the entire team.
  • Honor the employee with a framed “employee of the month” photo.
  • Place a photo or newspaper clipping of the employee on the company’s Wall of Fame.
  • Offer the employee a designated parking spot with their name on a sign or painted on the ground.
  • Give the employee a special position as a mentor, researcher, or chair of a committee. Career development opportunities can make for powerful motivators and valuable rewards. 

Rewarding Employees with Gifts on a Budget

When you’re concerned about how to reward employees on a tight budget, gifts might seem like a greater expense — especially when compared to an email or thank-you note. However, just like a thank-you note or personalized letter to an employee’s family, what makes a gift most meaningful to an employee isn’t necessarily the cost of the gift. It’s the fact that you noticed their efforts at work and took the extra time to express your thanks.

If you’d like to recognize an employee with a gift, there are several kinds of gifts that express your sincere appreciation without breaking the company’s budget. Many of these gifts can be personalized to the employee, their family, and their hobbies:

  • A bouquet of flowers for the employee and/or their spouse.
  • Free lunch for a day or free lunch for a week.
  • An item of clothing with the company logo.
  • A hobby-related gift or set.
  • A gift card for the movies, coffee shop, restaurant, or a prepaid credit card.
  • Credits for perks in your company’s employee reward marketplace.
  • A paid day or afternoon off — this is often the best gift of all.

Perform Acts of Service

Everyone in your business works hard — from the CEO who is invested 24/7 to the cleaning staff and contract electrician. When you need to work out how to reward individual employees on a budget, thinking a little outside the box and being prepared to get your hands dirty can open up a whole range of ideas for thanking your hard-working staff and increasing their sense of satisfaction on the job.

Along with words of affirmation and gifts, offering “acts of service” is another of the ways in which people give and receive appreciation. Consider these creative ways to reward an employee and let them know that they’re valued by the team.

  • Cover one of their least favorite tasks yourself or arrange for the task to be covered.
  • Help the employee finish up a task so they can go home to their family.
  • Swap one of your own tasks with the employee.
  • Pay for a car wash, house cleaning, or child care.
  • Surprise the employee by washing their car in the parking lot while they work.

Offer One-on-One Time

Positive company culture is based on building positive relationships, even when you don’t have a lot of time to spend with each employee. When an employee has put in a special effort, inviting that employee for some one-on-one time with you or a superior several levels up can be an especially powerful way to say “thanks” and build a long-lasting professional relationship.

Depending on your company structure and means, the following ideas could inspire you as far as how to reward employees on a budget. The time and cost needn’t be exorbitant to achieve your goal and will pay great dividends in the long run:

  • A one-on-one outing for coffee, dinner, or lunch.
  • A walk-and-talk or one-on-one Zoom meeting to touch base.
  • A game of golf or a trip to the theater.
  • A trip to watch a local sports game.
  • A team outing, meal, or retreat.

As you spend time with the employee or team, as well as paying for their food and/or tickets, invite them to share with you their input and ideas for the company. This will not only make them feel special but could provide valuable insights for the business as well. It’s also essential to follow through on the day and time that you set for the occasion. Rescheduling multiple times communicates that you don’t really appreciate them at all.

Appropriate Touch

Finally, many managers and business owners overlook the power of appropriate physical touch. It’s a little tricky to work out how to reward employees on a budget through touch if your team is international, works remotely, or during an international pandemic. However, if and when you can, research shows that touch creates a sense of reward, imbues calm, and helps to build cooperative relationships.

If you do work at an in-person office, the following are appropriate displays of touch when thanking an employee and recognizing their contribution:

  • Shake the employee’s hand.
  • Give the employee an elbow bump.
  • Give the employee a high-five and/or fist bump.

In times of COVID-19, the elbow bump is generally a safer substitute for handshaking and high-fives. For remote employees and virtual meetings, you can also substitute a digital emoticon for handshaking, high-fives, applause, and thumbs-ups in place of a physical congratulations.

Create a Rewards Program and Affirm Your Employees

Knowing how to reward employees on a budget is only the first step. The second and most important step is making sure that it actually happens. According to a 2014 survey by the American Psychological Association Center for Organizational Excellence, 36% of employees hadn’t been recognized in the past year and only 51% of respondents felt valued by their employers. The barrier is clearly not funds — it’s the lack of a clear program for recognizing employees.

Take the First Step

To begin recognizing and rewarding your employees, start conducting an annual survey to get to know the members of your team. Then begin to look for things you can affirm, and make recognition part of your schedule. To make sure each employee feels appreciated, use a checklist to keep track of who you have honored (and how) and the strengths you have noticed in each member of your team. 

Recognition Is a Meaningful Reward for Us All

Even if each employee isn’t honored publicly as “employee of the month,” you can still thank each staff member personally via email or in meetings for their unique contributions to the team. An employee who feels appreciated is a happy and more productive employee who will go the extra mile — and that’s likely to make your life much happier as well.

To learn more about how to foster employee appreciation, check out our interviews with Dr. Paul White, author of The 5 Languages of Appreciation in the Workplace: Empowering Organizations by Encouraging People. You can use the following links to access our interviews: