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Rewarding Employees

I have been toying around with the ideas of rewarding employees in some kind of fair and transparent way. I am not sure if people already use this method or not, I don’t think it’s any kind of rocket science either but it will surely be helpful to everyone here. Specially the HR, management guys and entrepreneurs.

I call this system a “Point Based Reward System”. I have assigned points to various tasks and each employee should achieve certain level of point slab to get the rewards.

Here is the table with break up of the points:

Task Points
Same Day Notice for Leave (If not taken) 10
How Many Paid Leaves Used (If not used) 05
Working Hours Followed 05
Timelines Achieved 30
Task without Bugs 15
Bugs found after application is made live (If no bugs found) 05
Generalized Code 05
Clean and Commented Code 05
Follow Standards and Procedure 05
Communication Confirmation & Clarifications via mails 05
Personal or un-official work (If not done) 10
Total Points 100
BONUS: Better ideas and ways to implement the code / work 10

Most of the points are self explanatory but I think some of the points might need some explanation.

Same Date Notice for Leave: For the pas few years, I have noticed that many employees take the day off without informing in advance, they just call up in the morning saying, “I am not keeping well” or any other reason. Now, this affects the scheduled tasks a lot. So I have assigned 10 points to it. For the first leave, 10 points are deducted and if it repeats again, additional 1 point will be deducted from the total earned points. Exactly same logic applies to 2nd point too.

If you notice, I have given very high number of points to tasks related to QA and Timelines. As in the end, quality is what matters to us. To track time lines and bugs, we are currently using ActiveCollab. It comes with a desktop timer application which helps to track the time of the user.

Now, this has some backdrop too. Some of the employees might feel restricted to the timelines and might give the highest importance to finishing the task on time rather than on the quality of the code. So to solve this issue, currently, I have not put any time based strict restrictions, I have asked the team leaders to maintain weekly milestones and make sure his / her team finishes the tasks in that period. No total number of fixed hours required.

For the Bugs, so far we have been using ActiveCollab but we have some in-house application planned for this but it’s going to take sometime for us to develop it. So you can either use ActiveCollab or applications like Trac or Mantis

We have also set certain procedures and standards for the code, so these standards must be followed. At this point, we are relying on the team leader’s feedback but it’s on you how you want to go ahead with this.

Another 2 important aspects are, Communication via emails and employees not spending more time on doing personal work.

In the past, I have come across so many instances where, either employee or me forget the important tasks or assign the task explaining few features mutually. Now, in this, there are very high chances that the employee might forget some of the points or he might do something the way you did not want. And this will end up raising questions like “You didn’t tell me about it” etc..

So to avoid this, I have added few points for communication via mails. Yes, it takes out some good amount of time to write the mails and all but it certainly helps to make your application better.

Another point I have mentioned is related to the personal work. Let’s face it, we all do personal work when we are at work. Be it phone calls, chat or surfing the sites. I don’t see anything wrong in that but in most of the cases, these kind of things affect the work and timelines. And if that happens, as a businessman, it’s surely going to pinch me hard. So that’s why the points come in for this. 🙂

I have also added 10 additional bonus points for the ideas. I am open to great ideas and suggestions always. This helps specially when you are developing your own application. So if anyone suggests the idea and if it’s been implemented, the 10 points goes to that employee.

So now what we have to do with these points? How does it work?

Well, We review these points at the end of every month and have made following slabs:

Monthly Total Points Bonus (% out of the monthly salary)
80 05
90 10
100 15

So, to get rewarded, you will need atleast 80 points in a month. More you work harder more you earn.

And in my opinion, it’s not at all difficult to achieve 90 points. You just have to be extra careful while doing your work. Specially when it comes to timelines and the bugs. You will have to start thinking logically rather than doing work like a machine.

In the current scenario, most of the employees work like a machine, they do not take care about the quality and bugs. Designer blames programmers and programmers blame designers for it. So this will help to squash all these issues. If the designer has given the HTML with no bugs then it has to work same way after programming too.

This was just a small example, there will be many other instances you will find that employees work like a machine.

NOW, there is 2nd part to it which I am not sure how many will follow.

On the basis of these points you can work out your annual or bi-annual appraisal structure too. I had planned it but I scrapped it after getting suggestions from the various employees. (Yes, we sit and discuss everything before making any new policies)

This is how the structure can be: (Following is for the period of 6 months)

Total Points Bonus (% out of the monthly salary)
Less than 480 05
480 – 539 15
540 – 599 20
600 or more 25

I personally liked this structure for the appraisals but some of the employees felt this will end up reducing their freedom and ability to work in team. (As everyone will be working for themselves rather than working as a team)

So for now, in our company appraisals will be based on their overall points and the performance based on the feedback from the team members.

There are few more things which I am going to implement soon to make everyone’s life easier. I will share the same with everyone once we are ready.

I hope this helps and yes, do let me know your suggestions, would love to hear from everyone. Specially from the people currently working for any company.

Image Source: Show us your smile! by Ben Smith

8 Comments

  1. This almost looks like some stripped down form of Agile scoring system. Have some stand-ups everyday before people begin working. Each person should speak about what they did yesterday, what they’ll do this day and what issues they’re unable to solve at the very point.

    This will surely bring about good interaction in your team and they should be able to work much effectively knowing who’s doing what and what should be done by whom and hows and stuff.

  2. Interesting idea.. Maybe I am comparing it to the work culture in US which would not be necessarily correct, but in my opinion rewarding employees for not using their paid leave should be not there. Let employees take the break they deserve and come back refreshed and help them boost their creativity at work. Now as I said before, the culture might not be the same on both sides of the world – so don’t hold me for it 🙂

    Your topic of bug fixes actually reminds me of a company a friend of mine works in where they have this kind of web dashboard with a tally of monthly bug fixes and their priority. It generates some result at the end of the month assigning points to each employee. They are obviously factored with respect to the no.of bugs fixed and the priority of bugs and the top 3 employees would get some reward which I thought was kind of cool…

    I really like the clean and commented code points though 😉 Its every managers pain point for his employee

  3. Mikkin – Actually in my company, there used to be a trend of “I am not keeping well”, “I have some urgent work”, “I have some personal work” etc.. so I had to put a pause button over it, let’s see how it works.

  4. Deep – don’t you think sometimes it is impossible for someone to actually predict that they won’t be able to come to office the next day?

  5. Yup sometimes but in my case, I have seen so many fake “I am not keeping well” or “I have some urgent work” calls.. so for me, it’s the first thing I had to put on the list and I am sure in other companies too, they must have faced the same issues.

    But again, in this exceptions are always there, so if there is any exceptional case, things can always be worked out.

  6. Quite interesting. Large organizations may find it difficult to execute this in isolation, however the bi annual appraisal should be able to cover most of this, but more from. This works well when tied in with Organization’s objectives and goals.

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