Rethink & Renew Your Employee Years of Service Award Program

Christina Zurek
Christina Zurek

happy employee receiving recognition

Chances are your employee anniversary recognition program isn’t realizing its full potential.

ITA Group’s latest research uncovered just 57% of employees like their employers’ recognition programs.  Closing the gap represents a huge opportunity in today’s competitive labor market. When employees are highly satisfied with the recognition offered, they’re 31% more likely to believe the employers committed to keeping them.

Related: Download our research report to learn more about this trend and read our tips and tactics to help build an organization employees love to work for.

What Is a Years of Service Award?

Years of service awards are one of the most common recognition programs and go by many names, including employee anniversaries, service anniversaries, service awards, service milestones and length of service awards. No matter what it’s called, it’s recognizing employees in meaningful ways when they achieve a tenure milestone.

Showing employees appreciation for their commitment and growth to the organization helps:

  • Drive employee engagement
  • Improve employee and organizational performance
  • Bolster retention

Celebrate Employee Service Anniversaries Earlier

Not too long ago, an employee might receive their first service award after five years—sometimes even 10 years. But employees aren’t sticking around as long as they once did. Today, the “1 year or less” tenure group  has a higher percentage of reasons for leaving a company than all other tenure groups. They cite health and family, involuntary, job, and work-life balance as top reasons.

Waiting five years to celebrate milestones is obsolete. Recognizing employees should happen early and often.   

“At ITA Group, we use data-driven analytics to identify key milestone events well before the traditional five-year mark,” said CJ Jacobson, SHRM-CP & PHR, Vice President, People & Culture at ITA Group.

“Our approach recognizes employees for performance as well as significant milestones. Plus, a creative communications campaign educates new and long-time employees on the benefits they can expect for future milestones. As a result, we’ve been able to significantly decrease turnover.”

Our clients have seen similar results: Employees with at least one recognition in their first year of employment in our programs have on average a 27% higher retention rate than those not recognized.

Consider Recognition for Milestones Beyond Years of Service

Depending on the jobs your people do and what they believe their contributions are to your goals, traditional years of service awards may not be the right milestones to reward. Instead, celebrating a variety of individual and company-wide milestones might make more sense.

For example, as demographics shift in organizations, it’s important to tap into the pragmatic, entrepreneurial spirit of millennial and Gen Z team members. Engage younger and less tenured employees by offering opportunities to grow, learn, experiment and progress in the organization and rewarding them for completing those opportunities.

No two companies should have identical milestones or ways of recognizing and rewarding team members.

Meaningful metrics within specific roles in the organization can be anything: client retention for salespeople, proposals completed for sales support staff, evaluations completed in a medical setting, customers served in retail environments or certification completion for technical roles.

Related: Curious to see what this could look like? Learn more about our milestone recognition expertise and client success stories. 

Offer Meaningful & Memorable Employee Years of Service & Milestone Awards

Individual motivations vary. Don’t limit award choices to too few items or spend the recognition budget on pins and plaques if no one values those items.

In our world with endless options to choose from, offering too narrow a selection of gifts can diminish motivational appeal and impact of the recognition.

Consider incorporating experiences as awards for the achievement. The psychological mechanisms underlying experiential awards drive better engagement for organizations and improved well-being for reward earners by connecting to their interests and showing you care about them as a person.

It’s best to provide autonomy by offering a variety of awards. If an employee doesn’t want one big ticket item but would rather have a gift package with two meaningful items, that’s great! Maybe some employees don’t want an award at all—offer them the opportunity to donate to a non-profit. As a best practice, regularly collect feedback from employees to ensure the awards hit the mark.

Create a Complete Recognition Experience to Engage Employees & Stir Emotion

People remember how they feel when they receive an award, so it’s important to think not just about the gift being given, but also the entire recognition experience.

For example, if rewarding an employee with a paid time-off increase upon achieving a milestone, deliver the message with a selfie stick asking employees to share vacation stories when they get back to work. Not only will this be one more means of communicating benefits to employees, but it also delivers the experience in a fun and creative way.

To add meaningful connection points from peers and leaders, deliver the award to the recipient during a special recognition moment in front of their peers.

Enable Leaders to Effectively Recognize Milestones Using a Combination of Guidance & Automation

Letting an employee’s milestone pass without any mention can make the employee feel less valued, producing negative feelings. Help busy leaders stay organized and on top of approaching milestone anniversaries. Integrate an employee milestone recognition program with your overall recognition program platform to ensure managers get personalized reminders about upcoming milestones and know where to find resources.

To make recognition inspiring and effective, personalize and align both the praise and award with your employer brand and culture. To do this, managers should reflect on the values the employee shows and all the strides they made since their last milestone celebration. But not all managers intuitively know how. By providing examples, specific guidance and templates, organizations increase the odds of managers expressing their appreciation in the most meaningful ways.

Communicate Regularly & Share Achievements

Implement and communicate recognition milestones during employee onboarding to build a loyalty message early on. But don’t tell employees just once! One of the biggest downfalls of employee milestone recognition programs is they're forgotten about. Creatively design and effectively (and frequently) communicate program details to keep employees excited and looking forward to their next opportunity for recognition.

In addition, create visibility within the organization when employees meet key milestones and recognize service anniversaries at all-employee meetings or a special ceremony to publicize the employee’s contribution. It’s nice recognition for them and shows you care. The ideal presenter is the CEO, president or division head, depending on an organization’s size.

Related: Extrinsic and intrinsic motivators such as social contact, belonging, praise and social recognition can be more difficult in remote settings, but there are methods to improve remote work and accomplish impactful external and personal outcomes.

Take a Personalized Approach to Employee Years of Service Awards

Every company should offer employees milestone award programs, though the specifics depend on your mission, values and what milestones are meaningful for your people. While not all ideas fit with every organization’s approach, times are changing and employee needs are evolving. A fresh approach to recognizing service (and other milestones) will make it a strategic benefit offering for your organization.

Looking for inspiration to revamp your own service recognition strategy? Read how we helped a retail client re-engineer their service awards program to increase employee engagement, streamline the fulfillment process and bring new life to how they celebrate loyalty and employee dedication.

Christina Zurek

Christina Zurek

Christina is an experienced leader with a passion for improving the employee experience, employee engagement and workplace culture. Few things excite her as much as an opportunity to try something unfamiliar (be that a project, development opportunity, travel destination, food, drink or otherwise), though digging in to a research project is a close second.