You Get What You Pay For

I’m going to offer you two reward options … consider carefully.

You are one of my best employees. Without workers like you, my company would falter and fail. Your innovative spirit and love for the industry I’ve embraced as my livelihood makes you a boon to my enterprise. You work hard every day and always manage to give a little extra. For this, you will be rewarded with:

1) An inspiring story about you with your mug gracing the cover of the company newsletter. Your photo prominently displayed above the time clock with the legend “Employee of the Month!” And if that weren’t enough, a chance to interact at lunch with a member of senior management!


2) Any amount of money.

Before you answer, let’s build some perspective into this dilemma. You’re not a member of management, nor do you want to be. You like the job you have and enjoy being good at it. You’re not starved for attention. Everyone you care about knows that you’re not only good at your job; you’re the best. You make approximately $15 an hour. You have a child. You have a mortgage.

Now choose.

What I’m trying to point out is a disconnect in the HR community that I have seen propagated time and time again: a belief that monetary compensation is not the primary motivator for an average worker. Even when companies were making profits, this bizarre justification would rear its head and convince well-compensated executives that hardworking employees prefer a pat on the back to more money. Put simply, even a small bump in salary can mean a lot to lower-wage employees. (Note that the aforementioned executives are the same people who – although generally given more recognition than the normal employee – argue that if they’re taxed too much or if the government limits their compensation, they’d have no motivation to keep them on the job.)

I’ve worked for companies that offered recognition instead of cash, food instead of cash (frozen turkey, anyone?), and some fairly useless benefits instead of cash (dry-cleaning pickup at a casual-dress workplace?). I took the recognition and ate the food. And with the realization that the senior executive I just had an awkward lunch with didn’t want to help me pay my bills, I went back to my desk to check Monster for new job opportunities that paid better. I don’t think that was the desired result of the recognition program.

I’ve seen this story play out hundreds of times, and once the job market opens up, I’m sure we’ll see a mass exodus of workers who are tired of being paid in kudos for doing the jobs of three people. In many cases, these exits may be sooner than expected and rather abrupt.

Now, I understand that times are tough and money is tight, especially when it comes to a fixed salary budget. So, what to do if you can’t offer a raise? One top option is to spread out what money you can through bonuses that are tied to performance. i4cp offers some great tips on pay-for-performance programs. After that, look to flextime and work-from-home options, both of which are also highly valued by employees. Doling out some paid time off – or even some optional unpaid time – can be lower-cost options that have real value to employees and employers, especially if increased workloads are causing fatigue and burnout.

And I’m not saying that recognition isn’t important in the workplace. Everyone needs encouragement and the validation of knowing that his or her efforts are being noticed. Recognition and opportunities for advancement are exactly what some employees crave, especially if they already feel adequately compensated. That’s why it’s a good idea to survey employees to find out the value they place on certain rewards and to break the results out by wage and job tier. But providing recognition isn’t a reward; it’s a basic function of being a good leader and managing your talent. Recognition is simply giving credit where credit is due, not a substitute for wages.

Share your thoughts on the true value of recognition and other reward programs.

Eric Davis
Eric received his master’s degree in journalism and mass communication from Marshall University in 1996. He has had 20+ years of workforce experience in a variety of fields. Before coming to i4cp, he worked as a laboratory technician for DuPont, a conference planner for Marshall University, the public relations manager for the Robert C. Byrd Institute for Advanced Technical Manufacturing, and a graphic designer for COX Communications.