Peer-to-peer 'tips' - US hype or a sensible approach to employee recognition?

While it has been greeted by some with scepticism, we think the US-born concept of 'peer-to-peer tipping', or 'peer-to-peer rewarding', deserves some serious consideration. So how does it work? And what's behind the hype?

How does it work?

In a nutshell, all employees are given a small monthly budget (usually £10 - £20). From this budget, they can 'tip' their colleagues (usually £1, £2 or £5) to thank them for their support or for going the extra mile. At the end of each month, any budget not used is taken back and re-issued at the start of the next month.

It is usually delivered as part of an integrated employee recognition platform, alongside other modules such as employee of the month and annual awards. But it can also stand alone.

The theory

It may seem a bit rash to issue everyone across the company with a reward budget with little control over how it's spent*. However, the concept supports and delivers on quite a few areas that are recognised as fundamental in helping promote 'employee happiness' and 'employee engagement' in the workplace.

The power of saying thank you

With 52% of employees dissatisfied with the level of recognition they receive, the benefit of colleagues showing their appreciation to others cannot be underestimated.

(Read more about The power of recognition and The value of saying thank you)

The strength of peer-to-peer relationships

Given the amount of time people spend at work, it should come as no surprise that an individual's relationship with their colleagues has a huge impact on their happiness, engagement and work satisfaction. The more a person feels they are valued by their team, that they share common goals and receive recognition and thanks, the happier they are, the more engaged they are and the harder they work.

Empowerment

When you give an employee control over rewarding their colleagues, this helps them feel connected with the business and engaged in the overall success of the business.

It's a positive feedback loop

It really is a 'win-win' situation in promoting a culture of recognition and ensuring people feel valued.

The person giving the reward feels positive and empowered. And the recipient feels recognised and appreciated. As a result, the recipient is more likely to help other colleagues and is also more likely to thank one of their colleagues. This creates a positive feedback loop that spreads the concept of recognition throughout your organisation.

*Note: While issuing rewards is at the employee's discretion, we would recommend clear directives are given on how to tip. We also recommend management undertake periodic reviews to ensure the system is being used fairly.

Active are experts in designing bespoke employee recognition programmes. If you're interested in the concept of 'peer-to-peer tipping' and how it could work for you contact us today