HR.com's State of Rewards and Recognition 2025
Executive Summary
If there were an Olympics for rewards and recognition (R&R), many organizations would be standing proudly on the podium. Our research shows that seven in ten organizations have built strong recognition cultures, and eight in ten offer robust rewards programs. Just like world-class athletes, companies have put in the effort and refined their strategies.
But the competition never stops. The best don’t settle for just making it to the podium, they push for new records, refine their performance, and find new ways to stay ahead. Even with strong R&R programs in place, there is always an opportunity to make recognition more meaningful, personal, and impactful.
To better understand the current state and future of R&R, this report explores:
- the perceived level of effectiveness of R&R programs
- the top drivers of R&R and how programs are designed and implemented
- the most favored rewards and recognition among employees
- which metrics organizations track in relation to R&R, and the extent that R&R intersect with employee performance
- the extent to which programs are formal, who has responsibility for implementing programs, and the challenges associated with making them successful
- how R&R may evolve over the next two years, and the extent that AI will play a role
- the practices typically associated with more successful R&R programs
To offer you a succinct overview of the report's contents, we have distilled the key findings below.
About the Survey
HR.com’s “State of Rewards and Recognition 2025” survey ran from January 2025 to March 2025. We collected 563 usable responses from HR professionals across virtually every industry vertical, using both our own resources and an external panel. Respondents are from all over the world, with the majority from North America, especially the United States.
The participants represent a broad cross-section of employers by number of employees, ranging from small businesses with fewer than 50 employees to enterprises with 20,000+ employees. Ninety-six percent of our respondents represent mid-sized or large organizations.
Defining Rewards and Recognition
as the system organizations use to acknowledge contributions by individual employees or larger groups such as teams or departments.
- Rewards tend to be tangible perks such as bonuses, gifts, paid events, etc.
- Recognition tends to be public or private employee appreciation, thank you notes, etc.
Rewards and recognition tend to be grouped into a larger strategy or program, so for the purposes of this survey we will often approach them as a single strategic initiative.
Major Research Findings
1. Many organizations today have highly effective rewards and recognition programs.
- 80% of HR professionals say their organization’s rewards programs and capabilities are effective to a high or very high degree, and 72% say the same about recognition.
- At least two-thirds tie R&R initiatives to a high or very high extent to:
- tenure
- performance
- values
- milestones (personal and/or professional)
2. While formal R&R programs tend to be most common, responsibility for these processes varies.
- Nearly half (47%) say R&R programs and processes in their organizations are formal, generally based on structured systems, programs and policies. A further 40% say they are a mixture of formal and informal.
- CHROs are most likely to be responsible for approving (29%) and implementing (27%) R&R initiatives. However, 1 in 5 say the heads of departments are most responsible.
- R&R reward nominations are most commonly made by the managers (73%), followed by peer nominations (55%), and customer nominations (47%).
3. R&R can have major advantages, but challenges also persist.
- The top advantages of R&R programs and capabilities are:
- helping employees feel valued
- enhancing employee experience
- improving employee attitudes and behaviours
- However, respondents say the top challenges with offering R&R programs are:
- lack of measurable performance goals
- lack of managerial training on best practices
- inconsistent application of R&R
Please note that the findings and recommendations contained in this report are informational only. Nothing in this report should be construed as constituting legal opinions or advice. Please consult an attorney if you have questions about the legal requirements, rules, or regulations associated with any content discussed in this report.
The State of R&R Programs
Finding: The majority of respondents rate the effectiveness of their organization’s R&R program highly
We asked respondents to rate the effectiveness of their organization’s rewards and recognition programs, and the responses were very positive overall. Nearly three-quarters (72%) rate the effectiveness of their organization’s recognition capabilities as high or very high. This is great as Gallup found, those who receive high quality recognition are 45% less likely to leave their jobs.
Furthermore, 80% say their rewards program is strong. Having a strong rewards program on top of an effective recognition program allows organizations to maximize employee wellbeing.
