The importance of an emotional salary

• Positive company culture
• Flexible work environment
• Good work-life balance
• Upskilling opportunities
• Supportive management
• Sense of purpose and belonging

9 low-cost ways NZ employers can recognise performance: 

1. Create personalised rewards

Understanding what motivates each employee is key to delivering meaningful, non-financial recognition.

According to Hays Salary Guide FY25/26, while there are over 25 employee benefits available, managers find it difficult to allocate them effectively and they often lack individual tailoring.

Start by gathering feedback to uncover the emotional salary components that matter most to each person, whether it’s flexibility, learning opportunities, or extra leave.

With these insights, you can design personalised rewards that align with each individual’s unique preferences and motivations.

2. Say ‘thank you’

Recognising staff doesn't have to come with a hefty price tag. Maintaining morale is crucial to keeping employees happy. A genuine and heartfelt ‘thank you’ can be highly motivating and make employees feel valued. There are different degrees of employee recognition though, so decide which will work for each individual.

For example, some employees find it very satisfying to receive formal public recognition, while others prefer a deliberate yet private ‘thank you’.

Consider the following low-cost ways to recognise employees' contributions:

• Publish a shout-out in the company newsletter
• Introduce annual awards for high achievers
• Encourage peer-to-peer recognition in weekly team meetings
• Write a handwritten note
• Announcing employee milestones like work anniversaries

No matter what method you select, genuine recognition efforts demonstrate that you’ve not only noticed their success but value their contribution.

3. Improve work-life balance

From flexible working to parental leave, work-life balance is high on employees’ agendas this year. Improving work-life balance can significantly contribute to enhancing company culture and allow you to recognise employees when budgets are tight.

There are many recognition programs that can enhance employees’ working experience, including:

• Flexible working hours
• More than 20 days’ annual leave
• Hybrid and remote working
• Physical and mental well-being programs
• Virtual lunch or quiz for remote teams

The  right to disconnect is gaining attention with some governments even mandating employees' right to not communicate or perform tasks outside of their normal working hours.

4. Career progression opportunities 

Many employees are motivated by career advancement. Offering the opportunity to co-design a progression plan to reach their goals is another way to recognise outstanding performance, while maintaining employee engagement.

Sitting together after their annual review, for instance, to determine how they can position themselves for a future promotion can be very meaningful. It shows you are invested in their future, while acknowledging their strong performance in real time.

This year, 32% of people who moved organisations did so due to a lack of career progression, which is the second most common reason behind a low salary (35%).

5. Set more challenging tasks

Not everyone is motivated by a promotional pathway though. For other employees, the opportunity to work on more challenging or varied work and expand their skills may be more meaningful. Or perhaps you could consider giving them the opportunity to lead a project or scope out an identified opportunity for growth.  

6. Provide merit-based promotions

Merit-based promotions are an effective way of boosting morale and employee satisfaction, even when budgets are tight. This demonstrates that you value hard work and support their career growth.

While you may not be able to offer a pay rise, you should still honour any pre-arranged commitment to promote an employee who has met the targets and objectives required to qualify for advancement. Failing to keep your word by not recognising such successes could demotivate an employee who has worked hard to be eligible for a promotion and may create an engagement and retention risk.

Furthermore, it could have wider-reaching effects, such as harming your employer brand and reputation in your market. 

7. Offer upskilling opportunities

No one wants to feel that their skills are stagnating. Therefore, offering ongoing learning and development opportunities can be a great way to reward top performers.

Discover some low-cost ways to achieve this:

• Upskill with free online courses
• Invite team members to sit in on important meetings
• Implement coaching and mentorship programs
• Encourage cross-collaboration with other teams and departments
• Set stretch assignments to push staff out of their comfort zone

Taking on new responsibilities is a great way to reward employees while supporting their long-term career growth. It helps them build new skills, refine existing ones, and gain exposure that boosts performance and promotion potential.

8. Flexible working options

Flexible working is rapidly becoming an expected part of most roles rather than a perk. As per latest Hays Salary Guide FY25/26, 58% of people ranked it as the most important benefit. While most desk-based employees currently work in a hybrid or remote environment, the concept of ‘flexible’ extends further.

Consider rewarding a top performer with flexible working hours within certain parameters. This can vary based on the needs of the organisation and employee, but often includes: 

• A 4-day work week
• Flexi time
• Flexible leave options
• Part-time employment
• Job sharing

9. Additional annual leave

Receiving additional paid time off can be highly rewarding. After all, if time is money, then this could be an ideal middle ground when financial rewards are unavailable.  

Consider offering a high performer the opportunity to take an afternoon off or have a long weekend. Offering an additional day or two of annual leave each year is another option. These types of employee rewards acknowledge their efforts while also giving them a chance to recharge, which is especially valuable after completing a demanding or high-impact project.

We can help