Why reward and recognition isn't landing

When we surveyed 1,000 UK employers and 4,000 UK employees, we found that the gap is significant - and unexpected - for many organisations: 

• 75% of employers say their reward and recognition programme makes employees feel valued. Only 53% of employees agree 
• 67% of employers say that recognition is happening in their organisation. Only one in four employees agree and say it happens throughout the year 
• 75% of employers say reward and recognition feels meaningful. Only 58% of employees agree. 

This gap isn’t a reflection on employers. People leaders across the UK work incredibly hard to make their employees feel valued, but the current workforce challenges they’re faced with are immense. Employers are trying to solve recruitment and retention, wellbeing pressures and rising expectations, all with real-term shrinking budgets. 

The reality is that most reward strategies were designed for a different world, where pay rises were more predictable, teams had more capacity, and organic recognition happened regularly through managers with more time to focus on their teams.  

Workforce changes are happening rapidly, so we can’t expect the same approaches to reward to deliver the same outcomes. Our report uncovered this: reward strategies aren’t struggling because employers don’t care - they aren’t as effective because we’ve misunderstood what employees need. 

Taking a step back from reward programmes brings clarity on how and why it actually matters to employees.  

We spoke to Tracey Paxton, Clinical Director at Perkbox, to understand more about the psychology of how reward is experienced: 

“Before people are employees, they are human beings, and human beings have a fundamental psychological need to know that they matter. They carry an invisible question with them to work every day: “does what I do make a difference?

When that question is answered positively, processes happen in the brain: dopamine is released, improving motivation and engagement. It helps make them more resilient. It tells employees that they’re doing the right thing, so they’re more likely to repeat positive behaviours like helping their colleagues.  

That’s what makes recognition so invaluable: it’s a biological signal that tells the brain that they belong, and they are valued.” 

The science of how reward is received matters more than most reward and recognition strategies account for:

“The brain is always looking for these signals, so it’s important to have those recognition mechanisms in place. 

The moment the brain doesn’t get those signals, it creates its own narrative - and it’s rarely positive. It assumes that no one noticed or cared about their hard work, that their work is irrelevant and doesn’t matter.”  

Psychologists call this negativity bias: humans are significantly more sensitive to the absence of positive feedback than organisations realise. This creates the disconnect to appear – what we call the intent-experience gap. 

This gap looks like moments where employers say, “we appreciate our people”, but employees don’t feel appreciated. Employers might put time and effort into launching a new scheme, but employees don’t experience the intended benefit. It’s those moments where employers think meaningful recognition is happening, but employees feel invisible. 

This is where the challenge is, as Tracey says:

“Employees don’t experience intentions; they experience behaviours.”  

People and leaders care, but many organisations let consistent recognition slip. Having the intent is one thing, but unless it’s followed through on with time carved out to make recognition a priority, it’ll struggle to become part of culture. 

The science tells us that people need to feel valued, but the data tells us that many don’t. Most organisations don’t need bigger budgets; they need to make recognition impossible to miss. 

Explore the reward intent-experience gap in our Science of Reward Report here