Incentives

Incentives, as an element of total reward strategy, should always be designed with the employer’s strategic objectives in mind. Incentives should reward individual employees or groups of employees through increased payment or non-cash awards that motivates them towards increased contribution to the enterprise. They are effective when the rewards help align employee efforts to achieve organisational goals. In this chapter some underlying principles of incentives are discussed, covering the reasons for incentives as part of motivational approaches connected to attract and recognise exceptional employee performance. Specific issues for the hospitality industry are reviewed, particularly how tipping and service charges are managed across organisations. The principles of incentive schemes are discussed, with consideration given to the outcomes from such schemes, both positive in boosting organisational performance but also potentially negative due to unintended consequences.