20 employee incentive ideas to motivate and engage your teams in 2025
Uncover how you can keep your employees motivated and productive with a tailored and considered employee incentive scheme.
Motivating employees takes more than just negotiating competitive salaries, conducting regular reviews, and offering benefits. Workers increasingly expect meaningful recognition and rewards for their contributions—yet many employers are falling short.
Research from Gallup shows that 90% of workers are unhappy at work, leaving the UK trailing behind comparable nations in workplace efficiency. However, employers have an opportunity to reverse this trend with tailored employee incentive programmes.
Need inspiration? This article examines 20 proven incentive ideas you can use in your compensation plan to energise and engage your team in 2025.
Uncover cutting-edge compensation strategies to motivate your teams in 2025
What are employee incentives?
Incentives are tools used to motivate or encourage specific actions or behaviours. In the workplace, employee incentives are compensation strategies employers can implement that are designed to inspire workers to perform at their best.
These can take the form of financial or non-financial rewards aimed at fostering positive attitudes and behaviours. The ultimate objective? To create a motivated, engaged, and productive workforce.
The importance of incentivising employees
Implementing effective employee incentives across the workforce can result in considerable benefits for employers, helping to:
- Boost productivity: Happy employees tend to be more productive. Research from Oxford University’s Saïd Business School shows that happier workers achieve a 13% increase in productivity.
- Enhance motivation: According to the World Metrics 2024 Report, 81% of employees feel more driven to work hard when their efforts are recognised and appreciated by their employer.
- Improve morale: The ups and downs of daily work can affect morale. A well-designed incentive programme helps maintain high morale and supports a positive workplace environment.
- Protect wellbeing: Recognition and fair rewards play a critical role in employee wellbeing. Feeling undervalued can lead to burnout and detachment, while effective incentives help workers feel appreciated and connected.
- Strengthen employee retention: Recruiting and retaining top talent has never been more challenging. Properly incentivised employees are happier, more loyal, and less likely to seek opportunities elsewhere.
What is the difference between employee benefits and incentives?
While there is some overlap between employee benefits and incentives, the distinction is crucial when crafting an effective incentive plan.
Keep in mind that benefits are baseline offerings available to all employees, regardless of performance. These typically include things like:
- Annual leave
- Flexible working arrangements
- Employer pension contributions
Incentives, on the other hand, are performance-based rewards, earned by meeting specific targets or goals. These are designed to acknowledge exceptional performance and encourage similar efforts in future.
With that in mind, below we’re going to look at the specific incentives you can offer to encourage employees to perform at a high level on a consistent basis, broken down into five distinct categories.
Flexible work incentives
The first set of employee incentive ideas we’re looking at revolve around flexible working.
Given the rise of both hybrid and remote working models in recent years, it should come as no surprise that a flexible approach to work is both a popular and proven way to increase happiness and productivity levels in staff.
1. Flexible working hours
It’s difficult to overstate how much of an incentive flexible working hours can be to the modern worker. In fact, our research shows that flexible working is the most attractive benefit for candidates, with 66% of workers prepared to forego a pay rise to obtain this.
Where possible and practicable, consider allowing your employees to have a more flexible working schedule that works around their personal lives, giving them a better work-life balance.
Not only does this give staff a feeling of having more control over their time and lives, but it will also signal to them that you trust them to deliver their work.
2. Remote work stipends
24% of candidates want employers to offer hybrid and remote working options. So, if you have remote workers or hybrid workers, a great incentive to boost productivity is providing support for home office equipment.
A comfortable office space is important for the wellbeing and productivity of employees, so this support should form a key part of managing a remote workforce.
3. “No-meeting” days
One of the biggest impediments to productivity at work can be having too many meetings.
While well-intentioned, a meeting can often be a time waster that eats into time that could be better spent on focused work.
As a result, you can implement “no-meeting days” to give workers the space they need to be productive while reducing potential stress and frustration.
4. Wellness breaks and mental health days
Ensuring that all members of staff have sufficient time off to unwind is proven to reduce the risk of burnout.
Given this, an incentive that could be used as part of a benefits package is offering staff one or two wellbeing days a year, which they can take to look after their mental and physical health.
Financial incentives
While employees love non-financial benefits, ultimately the biggest influence on someone choosing to apply for a job is the salary range on offer. Our research shows that 72% of workers say salary is the biggest influence in applying for a role, with 63% satisfied with their current salary, down 3% from last year.
The problem is your salary benchmarking strategy may not allow for above-market salaries. This is where financial incentives can come in, driving performance and keeping up staff satisfaction and retention.
5. Performance-based bonuses
Depending on your industry and the types of roles at your organisation, offering financial rewards for hitting specific performance milestones could be an option.
Milestones could include things like:
- Exceeding quarterly sales targets by 10% or more
- Completing major projects ahead of deadline and under budget
- Achieving consistently high customer satisfaction scores
- Securing new key accounts or partnerships worth £100K+
6. Profit sharing
Some organisations have seen remarkable success with profit sharing. This means that staff get to benefit from the success of the company, giving them a feeling of ownership and belonging.
This can not only boost motivation and loyalty but also help to create a more unified workplace culture where everyone is pulling in the same direction.
7. Financial wellness programmes
Financial wellbeing is a growth area, with people becoming ever more finance-savvy. We found that the top financial goals for workers over the next 10 years include:
- Saving for retirement (32%)
- Ensuring a comfortable standard of living (22%)
- Covering data-to-day living expenses comfortably (22%)
- Affording regular holidays or travel (21%)
As a result, giving employees the tools they need to plan, budget, and save can be a great part of effective employee incentive programmes.
8. Commission-based rewards
This is the original in terms of employee incentive ideas for a reason.
If you have employees who are in sales or sales-adjacent roles, offering commission on top of their base salary can help drive them to perform and succeed, as their pay is only limited by how many sales they manage.
Health and wellbeing incentives
We’ve discussed offering mental health days as part of a benefits package already, but there are a host of additional health and wellness incentives that leadership should consider. Let’s explore some of the most significant.
9. Gym memberships
Health and fitness have grown in both importance and popularity in recent times, with health club market hitting record highs. Employers can look to tap into this trend in order to incentivise their workforce while also improving morale and working to reduce absenteeism.
There are a variety of ways to do this, including:
- Offering subsidised gym memberships
- Provide fully paid gym membership
- Giving employees access to fitness apps or wellness classes
10. Access to health apps or programmes
There are a host of useful health apps which offer daily wellness practices and meditation routines, including:
- Calm
- Headspace
- Happier
Providing employees with access to these or similar alternatives can reduce stress, helping to lower levels of burnout.
11. Mental health support
Offering an employee assistance programme (EAP) has worked wonders for many organisations across the UK. These give employees access to services such as:
- Counselling sessions
- Legal advice
- Family support
It’s a worthwhile investment in most cases, with staff being given a valuable resource to improve their mental health and stay focused.
12. On-site or virtual health screenings
Another major health benefit employers can offer that is popular with staff is health screenings. To ensure accessibility, these can be conducted either virtually or in-person.
Health screenings ensure employees can get ahead of any potential problems and make improvements that will reduce absenteeism through sick leave in the long term.
Learning and development incentives
Learning and development is among the most attractive incentives to candidates, seen as a top desirable benefit for 22%, despite appearing in just 9% of job adverts.
These benefits are popular with staff because they provide a clear route to career progression and a sense of development.
13. Paid professional courses
If your industry has professional courses, then paying for your employees to go on these (or offering tuition reimbursement) can help to improve their skills and progress in their career.
With so many organisations suffering from skills gaps, providing these types of incentives should be an easy decision when it comes to upskilling employees and encouraging professional development.
14. Mentorship and coaching
A powerful incentive that doesn’t cost anything is mentorship and coaching. Getting senior staff to mentor more junior employees allows both the mentor and mentee to grow professionally.
Furthermore, mentors will improve their coaching and leadership skills and can get a profound sense of satisfaction knowing they are helping the new generation. Meanwhile, mentees can pick up knowledge gained from years of experience, which could help to propel their careers forward.
15. Lunch-and-learn programmes
These are informal learning sessions where employees have the opportunity to share knowledge over lunch.
This can help to encourage continuous learning in a collaborative environment, as well as build camaraderie amongst team members in a more relaxed workplace.
16. Career development sessions
Offering these as an incentive signals to prospective employees and current workers that you take their career seriously and you want to support them in achieving their goals.
These can be regular one-to-one meetings focused on short- and long-term career goals. The sessions could be tied in with mentoring, as mentioned above, but with more focus on specific career goals.
Recognition incentives
While the majority of workers are still driven primarily by financial incentives, recognition should not be overlooked.
Many workers want to know that their efforts are noted and appreciated by management. This means that recognition initiatives can often end up being just as powerful as financial ones.
17. Employees of the Month awards
Celebrating individual achievements through awards or public acknowledgement can build a culture of recognition that motivates staff to perform at their best.
You could offer small rewards along with public recognition, such as restaurant vouchers or gift cards. The important part of this is the public recognition of a job well done and getting the whole organisation to join in the celebration.
18. Social and team-building outings
These incentives are particularly powerful as they can help build a culture of collaboration and teamwork which contributes towards a positive work environment.
Ideas for social team outings include:
- Monthly pub quiz nights and casual after-work socials
- Outdoor adventure days like climbing or kayaking
- Escape room challenges and problem-solving activities
- Seasonal celebrations and festive team dinners
19. Peer-to-peer recognition programmes
One of the latest trends in employee recognition comes in the form of allowing workers to give shout-outs to each other for the excellent work they are doing.
This is a powerful way to grow a culture of celebration within your organisation, as it encourages support and recognition to come from every level, not just management.
20. Year-end gift packages
Finally, providing all employees with an end-of-year or seasonal gift can demonstrate your appreciation for their efforts over the course of the year.
These rewards can, for example, come in the form of gift packages or holiday hampers, giving staff a good feeling about their workplace as they head off for a few days of well-deserved holiday.
Empowering teams through strategic incentives
Incentivising employees means making a commitment to creating a motivated, engaged, and loyal workforce. By working to incorporate both financial and non-financial rewards, employers can address the diverse needs of their teams, thereby helping to drive productivity, morale, and overall satisfaction.
Remember, successful incentive programmes are tailored to an organisation’s unique goals and the specific needs of its employees. So, by implementing thoughtful, measurable, and inclusive initiatives, you can not only improve employee retention but also position your organisation as a leader in engagement and innovation.
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