As a business owner, you know your employees are one of the most important factors in the day-to-day running of your organization. They have to be properly rewarded with incentives when they perform well. Gift cards are quickly becoming accepted modes employers use to incentivize employees and they have proven to be more effective than cash and gift merchandise.
This is because, in the short and long term, gift cards benefit both employers and employees more than any other form of worker incentive.
Before we go into the benefits for employees and employers let’s understand what employee incentive is as it is a bridge to creating a perfect employee-employer relationship.
What is an employee incentive?
Incentives are rewards used to encourage employees to achieve their work goals. If employees are adequately motivated they will achieve their work goals which are also the employer’s goals.
Now that we understand the importance of incentives to the success of an employer’s goals we can now diagnose how gift cards are the best form of rewarding employees by dissecting the benefits of gift cards for employees and employers.
Why They are Beneficiary to Both Parties
1. Gift Cards can be Budget Friendly
Employers that want to reward employees on a small budget can do this with gift cards. An employee who likes scarves, for instance, could be rewarded with a $10 Amazon gift card to shop for a scarf she likes. This will fit the employee’s taste plus save the company some money. But in the case of cash rewards, $10 will be too small.
2. It is more memorable
When employees are celebrated or rewarded with gift cards the effect is more memorable. Taking the scarf example from the first point, the employee would get a scarf she likes and wear it from time to time. Every time she wears it she would be reminded of a time her employer rewarded her for doing a good job which will propel her to keep giving the company her all.
3. Gift Cards Improve employee performance
Appreciating employees more than just regular salary is a good way to motivate them to do more. Now rewarding them with exactly what they want is a whole different ball game. Because of the memorable nature of gift card rewards employees are more motivated to work.
4. They can be Tax-Free
This is another way gift cards help an employer save money. Some are not taxable as the law excludes them from being taxed. It is recognized as a gift instead of worker compensation. Trivial Benefits were introduced in the U.K to effect this. So gift cards leave employer and employee bank accounts smiling at the end of the day.
5. Creates Positive Employee Employer Perception
Imagine the scarf employee gets to the office with her new colourful scarf and other colleagues are full of praises and admiration of the scarf. They would drop compliments and a discussion about the scarf will most likely follow. In between this discussion the employer will be spoken about because they made it possible for the employee to get it. Such an employer will be perceived as a good person by his/her employees.
6. Gift Cards Offer Employees a Guilty Pass to Spend
Yes, it’s not cash but it can pay for a gift item of your employee’s choice without them stressing that they are spending their salaries. If you reward your employees with cash they will most likely spend it on paying bills and end up easily forgetting it. This is why gift cards are more beneficial to employees. They allow them to buy what they want without fear of losing money.
Every business owner should think of gift cards when they think of employee incentives. It’s the safest, most memorable way to go. In case you do not use the gift cards as planned, some of them have a good resell value.