Introduction
As Bowen argued, in a world of downsizing which is characterized with doing more with less, reward and recognition are pivotal factors to boosting morale and creating goodwill between employees and managers. Malhotra et al. (2007) define rewards as ‘all forms of financial return, tangible services and benefits an employee receives as part of an employment relationship’. Employers expect employees to deliver or execute assigned duties to their satisfaction whilst employees also expect their employers to assure them of adequate wages and salaries (rewards) after they dutifully deliver what is expected of them (Eshun and Duah, 2011). Reward is something given or received in return or recompense for service, merit, hardship, etc . The Cambridge dictionary defined it as “something given in exchange for good behavior or good work”. Some theorists also refer to reward as compensation. Mathis and Jackson (2004) are of the view that, compensation rewards people for performing organizational work through pay, incentives and benefits. The ability to achieve the company’s critical business goals is the preferred criteria imposed by majority of organizations today to reward their employees. Mayo (1998) argues that, many companies are unable to instill the joy of working in performing duties and responsibilities if there are inadequate rewards being promised. Again, reward provides a visible means of promoting quality efforts and telling employees that the organization values their efforts (Evans and Lindsay, 2003).
Types of Reward Rewards may be classified into extrinsic/external and intrinsic/internal. Shanks (2007, p 30) posits, extrinsic rewards “are a host of external things (tangible) that managers can provide that may serve as incentives for employees to increase their productivity”. These, among others, include; money, benefits, flexible schedules, promotion, job responsibilities, change in status, praise and feedback, a good boss, a nurturing organisational culture, etc. Tangible rewards (financial rewards) may be direct or indirect. Direct financial rewards refer to the pay an employee receives in the form of wages, salaries, bonuses, commissions, incentives, merit pay, stock options, etc. That is to say, direct financial rewards constitute base pay and variable pay (performance-base pay).
Base pay refers to the basic pay an employee receives which may be a wage or salary and usually influenced by external and internal factors. The former include conditions in the labour market, market rates, government influences, etc. Whilst the latter comprises factors such as job evaluation, collective bargaining with employees’ representatives, individual agreements, etc. These rewards are based on time worked and they constitute the bases on which majority of employees are compensated directly (Mathis and Jackson, 2004; Schuler, 1998).
Recognition and facets
Employees do not only want attractive pay and benefits, but also expect that their efforts are valued, appreciated and treated fairly. According to Harrison (2011- retrieved from recognitionreward.blobspot.com on 19/09/2011), recognition is the timely, informal or formal acknowledgement of a person’s or team’s behaviour, effort or business result that supports the organization’s goals and values, and which usually is beyond normal expectations.
To Brun and Dugas, 2008, recognition represents a reward experienced primarily at the symbolic level, but may also take on emotional, practical or financial value. Deeprose (1994) argued that the motivation of employees and their productivity can be enhanced through providing them effective recognition which ultimately results in improved performance of organizations. Recognition programs demonstrate respect for employees. A meaningful, thoughtful employee appreciation program is about valuing employees' efforts and having respect for who they are and what they do (Hart, 2011).
According to Long and Shields (2010), recognition can be categorised into formal or informal, cash or noncash, and individual or collective. 2.5. Job Satisfaction Satisfaction is an evaluative term that describes an attitude of liking or disliking (Ivancevich, 2004). Hence, job satisfaction is a positive emotional state resulting from evaluating one’s job experience. On the other hand, dissatisfaction occurs when an individual’s expectations from the job are dashed. Mathis and Jackson (2004) explain that, the important factor in job satisfaction is what employees expect from their jobs and what they receive as rewards from their job.
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