7 Key Employee Recognition & Rewards Trends in 2021

Ben Travis
January 12, 2021
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Employee recognition is the open acknowledgement and expressed appreciation for an employee’s contributions to their organization, and it’s one of the most important factors in employee engagement. In 2021, it will be even more important to recognize employees, especially as they face a brand new set of challenges and continued uncertainty.

Just how closely are recognition and engagement tied? Highly Engaged employees are 2.6 times more likely to work in organizations with a peer employee recognition program than Actively Disengaged employees. And when employees feel engaged, everyone wins.

So what can you focus on this year to successfully recognize employees in your own organization this year?

Need help planning your rewards strategy? We have a video for that.

To bring you the most important employee recognition and rewards trends of 2021, we consulted the top industry leaders and most recent research:

1. Support a more equitable and inclusive world

In 2020, many people experienced an awakening to the injustices that persist in our society and within their own communities. Increasingly, employees will expect their employers’ recognition and rewards program to support a more equitable and inclusive world, beyond the company’s internal DEI efforts. HR leaders can help their companies stay competitive in the talent market by encouraging support for social justice initiatives and providing employees with paid time off for voting, volunteering, and political/social activism.
–Analiese Brown, PHR - VP, Talent & Culture at

We don’t work in a vacuum, and it’s people who are the critical driver of business success. Among the many lessons we were reminded of last year was the importance of social justice in our society and how it impacts our responsibility as people leaders. Any successful rewards and recognition program in 2021 should support a more equitable and inclusive world.


To get a head start this year, learn more about the benefits of offering inclusive employee rewards. Plus, consider adding a donation option to your reward catalog—in 2020, donations to charities and non-profits from the Bonusly product increased 482% from the previous year. The ability to support causes they believe in was clearly a meaningful reward for many employees.

2. Offer holistic rewards

Because our environment has changed, so should how we reward and recognize our employees. We will need to go beyond company swag and shout outs during in person meetings and find ways to help improve their personal lives where they need it the most. This could be offering flexible scheduling or providing employees with free tutoring for students or yoga classes to help eliminate and reduce stress.
–Jessica Miller-Merrell, SHRM-SCP, SPHR, Chief Innovation Officer at

Teams can’t function when their people aren’t taken care of. It’s up to people leaders to focus on the whole person and offer ways to help employees not only at work but outside as well. When building out your rewards catalog, consider holistic rewards. Look for platforms that can offer rewards catalog options like training with remote fitness instructors, video chats with expert dieticians or life coaches, home office amenities, or Amazon Wellness-specific gift cards.

3. Tie recognition to purpose

Employees excel when they understand the purpose of their contributions, especially right now. Studies show that people who believe that their work matters are four times more likely to be engaged, learn faster, and feel more fulfilled. So how do you show employees their work matters? 

Successful organizations offer rewards and recognition that reinforce employees’ personal sense of purpose. Public recognition of contributions makes it easy for employees to understand their impact and purpose at work. That recognition also addresses key needs on a personal and professional level.
–Raphael Crawford-Marks, CEO at

Simply put, when people believe that their work matters, they’re more engaged. In fact, 88% of Highly Engaged employees are regularly shown how their work contributes to the larger purpose of their organization as opposed to only 37% of Actively Disengaged employees. When it comes to recognition, consider highlighting the ways in which someone’s work impacts not only their team, but the rest of the company, customers, and other stakeholders.

In 2021, tying recognition to purpose will be even more important to teams. The need for recognition is increasing right as we’re still adapting to changes in communication and working styles. With teams balancing remote work, public health guidelines, and other challenges, it’s your responsibility as a leader to make time for recognition and to tie that recognition to purpose.



4. Anticipate digital gift cards to grow as a preferred reward category

Our favorite trend of 2021 is a shift to digital work solutions, including for recognition and rewards. E-gift cards have been valuable for years because they offer immediacy, choice, and tracking. However, gift cards get pegged as impersonal. Now, through a distributed workforce lens, e-gift cards are increasingly recognized for their ability to give choice, provide experiences, and reinforce a job well done.
–Cindy Mielke, Director, Channel Marketing: Incentives at
Tango Card

The COVID-19 pandemic has pushed much of the workforce into a distributed, remote environment. Experiential rewards and in-office perks are going unused, and companies are recognizing the value in repurposing those budgets toward remote-friendly digital gift cards. In fact, the IRF Industry Outlook for 2021: Merchandise and Gift Cards report showed that 27% of respondents have shifted their travel incentives budget to merchandise and gift cards.

Digital gift cards, specifically closed-loop gift cards, have become the de facto standard for rewards recognition in recent months. Defined as gift cards meant to be redeemed at a specific store or experience (e.g. Amazon, Starbucks, etc.), closed-loop gift cards are flexible, effective, and valued employee rewards.


Source: IRF.

5. Expect rewards strategy to change with the coming vaccine

Most organizations will likely change their rewards strategy with the coming vaccine.

Based on the recent IRF Industry Outlook for 2021: Merchandise and Gift Cards report, this year’s vaccine rollout will “favorably impact the incentive market.” Most organizations indicated that they would change their incentive strategy over the next six months if vaccines are successfully distributed. Because of that, the second half of 2021 may see even more investment in recognition and rewards, especially if a strong economic recovery occurs.


Source: IRF.

6. Provide a flexible, adaptable rewards catalog

Having a reward catalog is key! People have different languages of appreciation, and what may be meaningful to one person may not be as engaging a reward to someone else. That’s why having a robust catalog with the opportunity for diverse reward experiences is your best bet for recognizing and motivating your team. In fact, utilizing gift cards can be a way to reach both experiential and merchandise reward lovers.

The IRF study indicates that companies aren’t listening. And with an entire industry of suppliers dedicated to helping companies provide gifts or tokens of appreciation, offering these types of rewards is easy. [...] Ultimately, if companies want to encourage and fuel employee satisfaction and engagement, they need to deliver the rewards their employees really want.
–Cindy Mielke, Director, Channel Marketing: Incentives at
Tango Card

Parting words

When you recognize employees, they’re more likely to stay engaged and stay around. It’s important to note that recognition isn’t a panacea for bad company culture, but it is a foundational pillar of any successful employee experience.

If you’re still looking for more information, check out these 12 Unique Examples of Employee Recognition in Action to see what other companies are doing, or you can chat with one of our recognition and rewards experts to understand what solution is best for your company, and how Bonusly can be customized to fit your unique business needs.

Ready for next steps? Tour Bonusly or schedule a demo.

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