The differences between rewards and recognition

Although misunderstood as the same term, rewards and recognition can be two very different things with very different impacts too. Neither of them is better or worse than the other. Both have its positives and negatives when compared and hence, in this post, we will find out the clear difference and its individual impact.


Rewards are tangible material gifted from the company’s side to the employee for their good work or achievement. This can range from pay rises, gift cards, company car, accommodation, paid holidays and more.


• If the reward is unique and something the employees are in need for, they will work for that reward.

• These rewards will look very enticing to employees or even potential candidates as rewards become part of your work life.

• This could be a turning point for many candidates as they chose these rewards for their hard work than other job offers. It gives you an upper hand.


• Once given, employees might tend to work only for the rewards and not for actually getting the job done. Their commitment towards work might be only because of the reward and that will stop the minute the rewards stop too.

• There could be a silent competition among employees when they know there is a price at the end to grab. Team work might not work out as cooperative as early.

• It could make the employees do work which is rewarding and not any other work.


Recognition is nothing but acknowledging your good work or achievement through means of verbal or non-verbal praise. This can be in a formal event like a team meeting or a casual one like a break-time talk.


• Free of cost. It only takes a bit of your time to praise someone and you have nothing to lose.

• Employees feel more worthy when praised for their work.

• Job satisfaction will be on the rise because praising is a way of saying that their work adds to the company’s success.

• Reinforce what needs to stay through praise and recognition.


• Chances of employees to cut themselves a bit of slack might be there as they will feel like they have done enough to impress the employer.

• If only a certain staff is praised, the others can feel demotivated as they are not praised.

When and how to use rewards

The reason for rewarding something is a crucial step. It should be an achievement by an employee like success in a project or doing something out of their usual work frame. However, when rewarding, the distribution of the rewards become very important. If you get it wrong, there can be huge conflict of interest among the employees and it will look like you have a bias. This will put all other candidates off. Here are a few ways to do it right.

• Objectively (and transparently) identify who deserves reward and for what: When you are rewarding an employee, one of the first thing you need to do is be open about why you are rewarding them that. More than the person who is rewarded, other employees will want to know why exactly as if they feel like they did more work and they haven’t received any rewards, it could become a matter in conflict.

• Figure out how much value the work contributed and set the reward accordingly: Nobody wants to work super hard for a project only to receive a coupon to some restaurant. According to the work done, up your rewarding game too.

• Decide if you want to reward only the big wins or the milestone steps along the way: Decide what aspects make you reward an employee. This is important as this should be constant with every employee. You cannot reward someone for a milestone and ignore someone else’s milestone while rewarding them for some other work. This is not fair to either the employee or the employer.

When and how to use recognition

Just because recognition is free of cost does not mean that you can do that for everything around you. Too much of anything is bad and this applies for a word of praise. If you overuse something, it loses its meaning. Hence, make sure the reasons for the recognition is justified.

Here are a few instances where you should provide recognition than reward.

• For doing work according to the company’s culture, value and aim.

• For small achievements which do not really call for a reward but is worth commenting.

• Even in team work, it is important to identify the ones who stand out and help the team the best. In team work, it is a common tendency to laze away. Hence, good work should be acknowledged.

• For employees who are having a hard time, a praise will go a long way. To know that the company sees that they are trying gives them immense motivation to work.

You should learn to walk the fine line between rarely saying any words of recognition and over-using it. Recognition shouldn’t be handled dingy. You see praise worthy work, you waste no time. That should be then and there praised. However, if you keep doing that for every tiny detail, the meaning and worth of it will be lost. Walk that fine line and you will have positive results.