Long service and loyalty for 2020

Zero hours contracts and portfolio careers have changed the nature of employment. So how can you reward loyal employees in today’s workforce?

The idea of a job for life is no longer a reality for most people entering workplaces today, as many employers have come to realise. Millennials and Generation Z workers in particular are demanding more from employers than before and because of this, are more likely to leave organisations that aren’t the right ‘fit’. With multiple employments now being commonplace, longservice awards (traditionally given for 20+ years of service) are no longer seen as achievable or relevant.

The benefits of loyalty

So it’s time for a major rethink – not least because the long-service awards themselves have included antiquated items such as carriage clocks and watches. However, this doesn’t mean it’s time to forget about them altogether; individuals still want to feel valued. Most employers recognise that the cost of replacing good people who know the business, are great at their jobs and have established good working relationships, is one they would want to avoid.

So how can long-service awards be modernised to appeal to the current workforce, many of whom may not be in it for the long haul or might have zero-hours contracts? 

“Employees are often on these contracts to allow flexibility around their lifestyle, studies, childcare, parental care, or for other reasons. This does not mean that they are any less committed than those who work full-time contracted hours and therefore should be rewarded for their loyalty. How this is achieved would need to be considered so as not to cause upset to those who are employed full-time, and again, the awards should be meaningful and beneficial to them,” says Vickie Graham, Business Development Director at the Chartered Institute for Payroll Professionals (CIPP).

Some new long-service awards being adopted by employers include eGift cards, instant rewards or gift vouchers which offer employees a choice of retailers, additional annual leave depending on the length of service, and approved sabbaticals. Of course, one traditional long-service award that most individuals would not turn down is a good old-fashioned bonus payment, although the tax and National Insurance implications should be considered.

Personalisation and choice

Ian Hodson is Head of Reward and Deputy Director of Human Resources at the University of Lincoln, which recognises service landmarks by offering employees credits to spend at various retailers.

“This way we know that the gift will be valued by the employee which certainly takes away a lot of headaches and worry for the reward team. We tend to see many individuals putting the amount towards a holiday, which I think is reflective about the value of down time desired in the modern workplace,” he says. “The aspect that must always remain is the recognition and the fact the senior management, local management and colleagues are recognising the service milestone. Often an email is worth more than a physical item.”

Organisations would also do well to consider the demographic and nature of the business, which will play a part in the perception of long-service awards, particularly as some industries such as retail, leisure and hospitality tend to have high turnover due to seasonal work for example. Hodson adds: “I believe recognition is always welcome. The challenge for the reward professional is to sit down and ask the questions: “What are we looking to recognise? Why do we want to recognise it? How do we want to recognise it?”