Report - 2026
The Science of Reward at Work:
Why it's not landing the way organisations expect
Foreword:
Leaders need to care about how their people experience reward and recognition
Organisations are not short of intent when it comes to reward and recognition. Most employers understand there is value in rewarding and recognising people effectively, and aim to do so. What is less well understood is the difference between how reward is designed, and how it is experienced in practice.
This matters because work is not simply a thing we do or a place we go. It has a deep psychological dimension. Individuals bring not only their skills to work, but their effort, identity and sense of self.
In this environment, recognition functions as a signal. It indicates what is noticed, what is valued and whether an individual's contribution is acknowledged. Get that right, and confidence, trust, engagement and belonging all follow. So too does performance. Get it wrong, and individuals can begin to question their place.
Reward and recognition need to be understood not simply as systems or strategies, but as lived experiences that can make or break how valued people feel at work – and how much they are willing to deliver in terms of effort, loyalty and engagement. Understanding how people feel about how they are rewarded and recognised – whether they feel meaningfully valued – can only bring benefits.
Our purpose at Perkbox is to make every employee feel valued. This research shines a light on how well organisations are achieving that aim, where they are falling short and how they can bridge the gap to create cultures of recognition that drive organisational outcomes. I hope this paper supports you to reflect on how you can embed emotion into your reward and recognition strategy as deeply as economics, building value and feelings of being valued at every level.
Clinical Director, Perkbox
Introduction:
Unpacking the psychology of reward and recognition
At their most powerful, reward and recognition do more than boost performance, motivation and retention: they tap into deep emotions, making people feel valued. And people who feel valued drive more value for organisations.
To dig deeper into the vital emotional experience of reward and recognition, Perkbox surveyed 4,000 UK employees and 1,000 UK employers.
We found a gap between employer intention and employee experience. What is designed to communicate value often lands as tokenistic, formulaic, inconsistent or unfair. When that happens, investment is wasted, and even risks undermining motivation, trust and meaning. To drive value and make our people feel valued, it's time to take emotion as seriously as economics.
business journalist
Executive summary:
Key findings for people leaders
01
Recognition is the exception, not the norm
Recognition matters to how valued people feel at work, but it is rare. Recognition is almost entirely absent in how many people experience work. And if people don't feel valued it risks eroding engagement and performance.
02
Employers believe they are delivering meaningful reward and recognition – but employees don't feel it
There is an intent-experience gap around reward and recognition. Employers are confident their approach is delivering meaning and value, but employees do not feel it day-to-day.
Say employees feel valued through reward and recognition.
Say reward and recognition feels meaningful, not a formality.
03
Managers make or break how people experience reward and recognition
Reward lives or dies at manager level, but inconsistency undermines meaning and impact. Employees value manager recognition the most, but rarely experience it. Employers recognise this as a major challenge.
04
Peer recognition is emotionally resonant but rarely received
Employees find recognition from their colleagues deeply meaningful, but the majority never receive it.
05
Employees lack clarity around reward and feel unfairly treated
Many employees do not understand their organisation's reward and recognition structures. Confusion breeds frustration and perceptions of inconsistency and unfair treatment – and it's worse among women.
06
Smaller organisations feel more human
Employees in smaller organisations consistently report more positive perceptions of reward and recognition, suggesting that scale brings complexity and confusion. As organisations grow, reward risks becoming more tokenistic, less meaningful and less clear.
employer
employer
07
Reward drives different emotional outcomes for different demographics
Gen Z workers value financial rewards more (unsurprising in today's cost-of-living crisis) but still want reward to feel personal and meaningful. Older workers (55+) are less motivated by reward as a novelty, and value being trusted almost as much as financial rewards.
18 – 24
55 – 64
"Employees just don't see reward as a policy. It's a signal. Authentic recognition strengthens emotional connection to the organisation. That increases motivation and drives up productivity and morale. And it signals that the organisation values individuals, not just the output."