Understanding tangible rewards
Tangible rewards are the material side of employee appreciation. While recognition acknowledges contributions, tangible rewards provide something concrete. They're most effective when combined with genuine appreciation, not used as a substitute for it.
Tangible examples
- Cash bonuses
- Gift vouchers
- Merchandise
- Experiences
Intangible examples
- Verbal praise
- Public recognition
- Increased autonomy
- Career opportunities
Types of tangible rewards
Common tangible reward options:
Tangible reward options
Tangible vs intangible rewards
- Tangible rewards: Provide material value, short-term motivation boost, visible recognition
- Intangible rewards: Address psychological needs, longer-lasting engagement impact, lower cost
- Best approach: Combine both - tangible rewards for significant achievements, intangible for daily appreciation
FBT considerations
Non-cash tangible rewards may be subject to Fringe Benefits Tax. Minor benefits under $300 may be exempt if provided infrequently. Keep records of all rewards provided and consult your accountant about FBT obligations.
Tangible reward best practices
Selection
- Consider employee preferences
- Match value to achievement
- Offer choice where possible
- Consider tax implications
Delivery
- Present with genuine recognition
- Deliver promptly after achievement
- Explain why they earned it
- Public or private as preferred
Common tangible reward mistakes
Rewards without recognition
Giving gift cards without explaining why reduces impact. Tangible rewards should accompany genuine appreciation - the recognition matters as much as the reward.
One-size-fits-all
Not everyone values the same rewards. Some prefer cash, others experiences. Where possible, offer choice or personalise rewards to what the recipient values.
Disproportionate rewards
Rewards that don't match achievement feel either insulting (too small) or unsustainable (too large). Match the value of the reward to the significance of the contribution.
Key takeaways
Tangible rewards provide material recognition for employee contributions. They're most effective when combined with genuine appreciation, matched to recipient preferences, and proportionate to achievement. Consider FBT implications for non-cash rewards in Australia.
RosterElf's staff management helps Australian businesses offer intangible rewards like schedule flexibility alongside tangible recognition programs.
