INTRODUCTION:

Employees not only want good pay and benefits, they also want to be valued and
appreciated for their work, treated fairly, do work that is important, have
advancement opportunities, and opportunities to be involved in the agency.
Recognition and rewards play an important role in work unit and agency programs to
attract and retain their employees. It is the day-to-day interactions that make
employees feel that their contributions are appreciated and that they are recognized
for their own unique qualities.Managers are constantly searching for ways to create a
motivational environment where associates(employees) to work at their optimal levels to
accomplish company objectives. Workplace motivators include both monetary and non-
monetary incentives.

MONETARY REWARDS

“The purpose of monetary rewards is to reward associates for excellent job

Monetary rewards are given for a variety of reasons. Some examples are meeting sales goals,
achieving quality, outstanding performance in a given situation, or delivering a special project.
Typical rewards are money in a form of a bonus, trips paid for by the company, profit sharing, salary
raises,project bonuses, employee stock options(allowing employees to buy shares and
take small ownership in the company), commissions, promotions, and company
perks such as an expense account and warrants. If employees are motivated by
money, it will make sense that they perform better if monetary incentives are
employed. The type of monetary incentive should be evaluated however,
because different types of monetary rewards will bring different end results. .
Monetary incentives can be diverse while having a similar effect on associates. One example
of monetary incentives is mutual funds provided through company pension plans or insurance
programs. Because it has been suggested that associates, depending on their age, have
different needs pertaining to incentives, traditional incentive packages are being replaced
with alternatives to attract younger associates.

Problems with Monetary Incentives

Alfie Kohn (1993) argues that monetary incentives encourage compliance rather than risk-taking
because most rewards are based only on performance. As a result, associates are discouraged
from being creative in the workplace.Another argument Kohn presents is that monetary incentives
may be used to circumvent problems in the workplace. For example, incentives to boost sales can be
used to compensate for poor management. Employers also may use monetary incentives as an
extrinsic rather than an intrinsic motivator. In other words, associates are driven to do things just for
the monetary reward versus doing something because it is the right thing to do. This can disrupt or
terminate good relationships between associates because they are transformed from co-workers to
competitors, which can quickly disrupt the workplace environment (Kohn, 1993).
NON MONETARY REWARDS
“Non-monetary rewards are benefits that are not, or cannot be, directly measured in terms of monetary
units. These include the satisfaction realised from enjoying a certain way of life or style of work.”

Non-monetary rewards should form one important part of a complete employee recognition
program along with monetary rewards.  Each motivates employees differently.  Non-monetary
rewards can be used for either individual or team rewards.Research shows that employees some
employees are primarily motivated by financial rewards, and will dramatically improve their
performance to achieve such rewards.There is second group of employees who are more likely to be
motivated to improve their performance through the use of nonmonetary rewards such as being
thanked publicly at a departmental function, having lunch with the head of the organization, or
receiving an extra day off.  The desired outcome of rewards and recognition programs is to improve
performance. Non-monetary recognition can be very motivating, helping to build feelings of
confidence and satisfaction. Non-monetary benefits or rewards to employees for their performance
and contribution is one of the best methods of motivating them. Non-monetary incentives are as
important as monetary incentives. Organizations and their HR managers constantly strive to find
innovative ways of rewarding performers.

Experts say that the benefits that employees look for from employees depend on their personal
priorities too. For example, a working mother would look for benefits like work from home, flexi
working hours, transportation facilities etc. A few benefits that employees look for which are flexi
timings, work out of home, day care center provisions etc., family engagement involving the family in
various aspects of the company’s work practices free time to pursue one’s own research / hobby / pet
projects, paid sabbaticals to further enhance academic knowledge paid holidays additional leaves for
paternity gifts in kind or gifts vouchers etc. Employees look forward to a good working atmosphere
where meritocracy is respected. Various employee engagement activities are practiced, good talent is
recognized and opportunities to grow and interact with members of the senior and top management.
Such intangible benefits are advantageous for both the employees and organizations. Experts believe
that such intangible benefits help in creating an emotional connect between the employee and
organization that could turn beneficial in the long run. Employees seek recognition for the job which
they are performing, irrespective of the kind of work.

Some of the NON-MONETARY REWARDS are listed below:

* Official recognition of an employee's contribution. It could be a social recognition or informal

* A challenging assignment would assure an employee of the management's confidence in his

* A special treat can be organization for the employee and / or his family members in the form of a
lunch or dinner, weekend resorts, etc.
* Paying special attention to the heath & safety needs of the employee and his family would also
serve as an excellent non-monetary reward. This could be in the form of medical and hospitalization
benefits or insurance for all his family members.

* Giving additional responsibility to an employee acts in much the same way as a challenging
assignment and motivates the employee.

* Rewarding an employee for his performance through free gifts or free vacations can boost
employee morale. The vacation can also provide him with a much needed break after a challenging
assignment.

* An employee could also be given special memberships to certain exclusive clubs, gymkhanas,
recreation centres, etc.

* Awards, as a form of incentive, for exceptional performance and valuable contribution will further
add to the social esteem of an employee. This could be in the form of certificates, letters of
appreciation, quality award, best performer or best employee award, etc.

Non-monetary benefits work well under two circumstances:

(1) when the employee is well paid and the company is comfortably positioned on the salary
benchmarking scale

(2) there is a limited ability to pay and thus a need to be creative.

NON -MONETARY rewards do have their advantages and disadvantages:

Apart from recognition, it motivates employees to perform better; however if the processes are not
transparent, it may be de-motivating. The cost to the company is limited; however, an organization
may even go overboard with a barrage of non-monetary incentives leading to unrealistic
expectations and costs. It builds a sense of commitment to the organization and fosters a culture of
togetherness; it could also result in unhealthy competition amongst the employees. It helps to
attract and retain talent, yet it can never be a substitute for monetary rewards.