Lockdown incentives: how employers are rewarding staff in the Covid era

Employers are putting local at the heart of their incentive and reward strategies in the pandemic era, suggests fintech Miconex. The Scottish firm received over £440,000 in corporate orders for its local Town and City Gift Card programmes in the UK and Ireland in 2020.

The IRF found that around 81% of UK companies offer non cash rewards to staff with 71% having incentive and reward budgets of £100,000 and under. In 2020, the GCVA reported that B2B gift card sales grew by 26.3%, with employee benefits accounting for two thirds of these sales.

The pandemic related impact on employee benefits and rewards was swift with a May 2020 Willis Towers Watson report suggesting that two fifths of employers had made, or planned to make, changes to their benefits programme as a result of covid-19. 

The report also found that half of employers believed covid would have a moderate to large impact on employee wellbeing, including physical and emotional health, social connections and financial wellbeing. Fast forward to 2021, and 42% of employers say their health and wellbeing programmes need to change to support the changing needs of their employees.

One of the companies rewarding staff with a local gift card is ingredients manufacturer and solutions provider to the global flavour, fragrance and consumer goods markets, Treatt, who cite the economic and societal impact of the pandemic as a pull factor to purchasing a Bury St Edmunds gift card for each of its 200 employees.

“There has never been a more pressing time to support local and thank staff for their work during the pandemic,” said Executive PA at Treatt Chloe Ludkin. “As a manufacturing business, many teams have still been on site developing products for our international customer base, with enhanced social distancing measures and systems like contact logs. Some staff have been working from home, which they were not familiar with, and at first it was a big change. Staff wellbeing was, and continues to be a priority.

“The Bury St Edmunds card can be spent with over 50 businesses in the area, and the choice is diverse. It meets the needs of our staff members who range from school leavers to people who have been with us for over 40 years. Rewarding staff with a local gift card ties in well with our culture of community support. Staff were really pleased with the gift card. They’d worked so hard and deserved a treat.”

Town and City Gift Cards can be spent like local currency in a town, city or area, on retail, leisure, services and hospitality. After rapid expansion in 2020, a Town and City Gift Card programme exists in each of the 12 regions of the UK and Ireland- a total of 59 programmes in February 2021. The highest concentration of programmes in a region is currently Scotland, where the Town and City Gift Cards programme originated, with 17 active programmes.

In Scotland, recruitment specialist TMM Recruitment Ltd used the newly launched Aberdeen Gift Card as a festive thank you to staff. Managing director Amanda McCulloch said it was a way to surprise staff at the end of a tough year:

“Reward and recognition are important elements of the culture at TMM Recruitment. Usually at the end of the year we host a peer to peer awards event to celebrate the year’s successes. As that couldn’t happen we decided to show our appreciation for staff and support local businesses at the same time.

“The pandemic has caused us to become more locally focused in society. With so many people working from home there’s a greater appreciation for local retailers and hospitality businesses.  In the run up to the Aberdeen Gift Card launching in our city, there was a real sense of community spirit. Everyone thinks the scheme is fabulous and staff were delighted by the gesture. The gift card is accessible no matter your age, interest, stage of life, or even if you want to treat someone else, you can.”

Over £1.9 million was spent through Town and City Gift Cards in 2020, evidencing the societal shift towards local shopping and local communities. The choice and added wellbeing offering was a factor for Salisbury Medical Practice who rewarded staff including nurses and health professionals with a Salisbury Gift Card in 2020.

“We wanted a way to thank our staff for their incredibly hard work during this year while also showing our support for the businesses of Salisbury, and encouraging people to shop locally,” said Dr Rebecca Seabridge, managing GP partner from Salisbury Medical Practice. “Giving our staff the Salisbury Gift Card means they can choose what to spend their thank you gift on. Perhaps a nice meal to look forward to when restrictions allow, a new outfit or haircut. It could even pay for their next dental check-up or go towards new glasses or a bike. We were impressed by the variety of options the Salisbury Gift Card offers.

Colin Munro is the managing director of Miconex and believes that employee benefits and rewards strategies will continue to evolve as a result of the pandemic:

“The UK economy shrank by a record 9.9% last year and it brought huge change and uncertainty for workers, it’s natural that employee rewards have adapted to reflect this. Small businesses are really struggling. Many employers are choosing to reward staff with local gift cards that take into account the unique environment the pandemic has created. Most of our corporate orders were for over £500 as employers were able to take advantage of the UK trivial benefits scheme, enabling them to gift each employee a tax free benefit of up to £50. In Ireland, the small benefit exemption is €500 per employee.

“As well as employers rewarding staff at traditional times, like Christmas, we’re also starting to see local gift cards being used to reward staff throughout the year. In Sunderland, we’ve seen gift cards purchased to reward staff for overtime worked or sales targets achieved. As we move into a new stage in the pandemic, I expect to see even more different uses of local gift cards, to help staff stay motivated, stay healthy, and feel rewarded in these unusual times, whilst supporting local businesses that really need our help.”

Author: Editorial Team

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