Service Awards Documents

Virtual HR Department

Reward and Recognition

Other VHRD Sections

Service award programs are very popular recognition tools in many organizations. Typical programs recognize employees at five-year service intervals, often commencing at five years of service. Program design is highly flexible, both from the perspective of what years of service are recognized and with respect to the type of awards that are offered.

Some organizations offer some kind of token gift and a card at an employee's first anniversary, simply to acknowledge this first, small milestone. In environments where there is high turnover or retention is a major concern, companies have also offered a three-year award, followed by a five-year award and a transition into the typical five-year interval structure. The dollar value of the awards typically increases at each level in a relatively consistent scale (e.g., value of $20 per year of service). Many programs will also feature special recognition of employees reaching significant milestones such as 25 years, including a special ceremony on the shop floor and a lunch or dinner for the employee and their spouse with the President/Owner.

While there is a cost to providing these awards, if it contributes to employee retention (as well as employee engagement and satisfaction), the cost becomes negligible compared with that of turnover. Programs can be created and run in-house, and there are many vendors offering structured outsourced programs. Typically, these vendor programs will include all of the documentation and communications templates required.