What Is an Employee of the Year Award? (With Benefits)

By Indeed Editorial Team

Published July 18, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Employees are essential assets to an organization as they are critical to its operations' success. A company can motivate its employees by presenting them with awards and recognition for their excellent services. Learning about these awards and the criteria for giving them can help you foster company loyalty in a team or organization. In this article, we explain the Employee of the Year award, discuss the criteria for awarding employees, outline this award's benefits, and share tips to help make the award presentation more effective.

What is an Employee of the Year award?

An Employee of the Year award is a badge of honour employers give employees to recognize their efforts and contributions toward propelling the company's visions. Organizations use this award to distinguish employees from their counterparts and acknowledge them for their disposition, attitude, and performance. These awards can take physical forms, including plagues, certificates, and trophies. An organization typically presents this recognition award at company events, such as conferences, holiday parties, or seminars.

Criteria for choosing employees for recognition awards

Organization management typically ensures that the employee receiving the award possesses an exemplary work ethic worth emulating. Here are common traits employers require aspiring awardees to possess:


This trait typically manifests as a strong sense of loyalty and support for the company. Employees demonstrate dedication to a company by possessing a positive attitude toward work and showing passion for their job. This employee is usually punctual for work-related activities and is flexible enough to find effective strategies for completing their assignments. Even when they don't have extensive experience in their chosen fields, they are typically eager to learn and commit to necessary training.


A reliable employee is someone a manager can trust to complete their tasks even without supervision. These employees are valuable to a company, as their managers can focus on other tasks because they trust them to achieve their assigned duties and manage any arising complications. Reliability involves delivering quality work, being punctual, meeting deadlines, showing initiative when necessary, and demonstrating eagerness to complete more significant responsibilities.

Related: What Is Reliability in Psychology and How Is It Important?


Integrity includes traits like honesty and accountability. A manager trusts an employee with integrity, as they foster transparency in the workplace. These employees are honest about their preferences and capabilities, which creates an environment for open communications. An employee with integrity is conscious of the company's core values and is ethical in business practices. This helps them gain the trust of their team members and manager. With integrity, it may be easier for these employers to devise strategies and make decisions based on honesty, which can lead to the company's success.

Related: What Is Honesty and Integrity in a Workplace Setting?

Critical and innovative thinking

Managers typically value team members who possess critical thinking skills. With this skill set, they can view a problem, review different perspectives, and develop a logical solution for managing the situation. These employees identify a business's weaknesses and strengths, ask relevant questions, and record crucial details that can help them find a sustainable solution to problems. Companies typically consider employees with critical thinking skills as assets.

Related: Why Critical Thinking Is Important in the Workplace


Teamwork is crucial to completing a project or objective, as it facilitates successful collaboration between and within departments. With teamwork, employees can demonstrate the patience, tolerance, and communication necessary to relate with colleagues. This trait enables them to contribute positively to a team. Employees who demonstrate teamwork are respectful and supportive of their team members, flexible with change, and work toward the success of the team and organization. Teamwork includes the ability to adapt to different roles, including leadership roles, as it makes it easier to join an existing team.

Related: How to Improve Teamwork in the Workplace (With Tips)


Employers are likely to recognize employees who respect the brand's core values and work culture. An employee can demonstrate professionalism by being courteous and treating colleagues respectfully. These employees also possess the expected skills and good judgement necessary to complete their responsibilities. They adhere to the company's code of conduct, follow set standards, and exhibit positive traits outside their work environment.

Related: How to Develop a Professional Attitude (With Specific Steps)

Benefits of awarding employees for their services

Here are reasons an organization can consider presenting recognition awards to deserving employees:

Increases employee retention

Employee turnover occurs when a company replaces an employee with a recruit. This process costs the company resources and time as management trains the recruit for the open position. With an employee recognition award, there may be a reduction in voluntary employee turnover. This is typically because these recognition awards may create a sense of belonging and purpose in the employees. They may feel valued and appreciated by the company. This proper recognition may reduce the company's employee turnover rate and help the company save resources.

Related: What Is Employee Appreciation, and How Can You Implement It?

Inspires other employees

Rewarding excellent service with an award can be an effective strategy for inspiring other employees to work harder. While striving for the same accomplishments, these other employees may start emulating the awardee's traits. This may result in increased productivity, more sales, and improved commitment to the company goals. The award may also serve as a reminder of how the company recognizes and appreciates hard work and dedication.

Related: What Is Retention Ratio? (With Uses and Important Benefits)

Defines workplace culture

Before presenting an award, it's common for the company to discuss the award's criteria and the traits they're looking to appreciate. Doing this can help the company define and re-emphasize its culture. These awards can also help demonstrate what the company cares about and represents. Recognizing employees for their excellent service may help increase company loyalty and shape the company's culture.

Related: Culture Change in the Workplace and Tips for Managing It

Improves employee happiness and morale

Recognizing and appreciating employees for a job well done may be effective in improving their morale. Employees may work with a stronger sense of worth when they know the company appreciates hard work. This generally increases job satisfaction and promotes a higher sense of well-being. As a result, there's typically a rise in group morale, optimism, and a sense of respect within the workplace.

Related: What Is Employee Satisfaction and Why Is It Important?

Facilitates better customer service

As the management team oversees several projects, employees are generally the face of the company. Customers typically get the first impression of the company from their interaction with the staff. Employees are more likely to deliver excellent customer service when they feel appreciated and gain recognition for their efforts. This makes them expend more efforts to ensure they meet customers' needs and demands. Recognized and happy employees typically lead to improved customer loyalty.

Related: Tips on How to Provide Good Customer Service (With Benefits)

Increases engagement levels

Appreciating employees for their service may result in a general increase in engagement within the workplace. As the employees understand that management is monitoring their activities to identify who to award, there may be a reduction in absenteeism. There's also a reduction in safety incidents and quality defects. This leads to an increase in productivity and sales. An increase in team engagement ensures team members arrive at work with energy, purpose, and passion for the job.

Tips for awarding employees

The following are best practices to help ensure the award selection and presentation process is effective:

  • Make the recognition formal. A company can increase the validity and value of a recognition award by following the company's standard legal procedures. Presenting the awardee with a formal letter and ensuring accurate documentation can help achieve this.

  • Consider all employees. Ensuring all employees have equal chances and considering all employees that meet the criteria regardless of their level can make the process fair for the concerned parties. This can promote healthy competition within the workplace and facilitate better collaboration.

  • Announce selection criteria. Providing information on the traits the company is looking to recognize can facilitate transparency in the process. Posting the information and guidelines on a notice board or the company's website may make the criteria details accessible to everyone.

  • Hold the event early. After making a formal announcement, scheduling the award event early is often advisable to ensure time to organize it. Holding the event early can also help the company focus on other activities.

  • Consider employees' votes. If possible, the company can gather nominations and allow the employees to vote for their preferred candidate. This may make the process more transparent, as the employees typically know and understand each other's traits better.

Related: Awards on a Resume: Which Ones Are Relevant and How To List Them

Explore more articles