There was a time when employees spent a large portion of their careers with a particular organization. Moreover, they took pride in doing so as well. But the concept of a ‘job for a lifetime’ no longer exists. This has really redefined how people see long service awards (LSA). Even the mindset of employees and employers has also changed in the last two to three decades. Earlier, just like how employees cherished the ability to stay with one company for a lifetime, employers also loved hiring employees with a record of spending long years with one employer since that resource would be stable. Now, things have changed. Employees are aware that they want to grow in their careers and gain diverse experience working in different sectors and roles. Frequent job hopping also helps employees to increase their salary package. On the other hand, more than stability, employers value a diverse experience from the candidate and their will to learn new skills.
Why are LSAs being redefined?
The attrition level in the Indian corporate has been on the rise. A study by AdvantageClub.ai shows India’s overall attrition rate is 16%. In fact, some industries have an attrition level of more than 30%. In this highly volatile job market, it is not surprising that the average tenure of an Indian employee is decreasing. As per a study, an average tenure of an Indian employee has fallen by 20% since 2020. As per the report, currently, the average tenure of an employee stands at two years. An average employee will only stay with you for up to two years. What does this mean? Will this lead to making LSAs redundant in the coming years?
There are various factors that have led to this situation. In earlier days, opportunities were fewer, and people had few options to move around. But today, there are ample opportunities in the market. Competition has increased, and the value of skills has forced companies to attract and poach good people with attractive compensation, benefits, and perks. Moreover, there is a lot of cross-pollination of talent within industries. Earlier people were vary of moving between sectors, but now this is not the case. Even employers are willing to hire people from other industries. At last, the emergence of startups and the amount of empowerment a startup culture gives to an employee has also played a significant role.
How is it impacting HR?
High attrition is a challenge that everyone knows, but the declining tenure of employees brings a different dimension to things. To retain people, HR now needs to show what value it can add to people if they stay with the company for longer periods. They need to attach a higher premium to the LSA rewards, which brings value to the table for employees.
Moreover, the trend of celebrating a long service award has changed. Earlier, when an employee spent at least five years on the job, it called for a long service reward. Now, companies have started celebrating long service celebrations after each year. This is done to motivate the employee to keep continuing with the firm.
How are LSAs being redefined
The way companies look at LSAs these days has changed. Since the tenure of employees is shrinking and companies want to keep their good people, they make every work anniversary a special moment for the employee. Many companies and startups celebrate anniversaries in their own way.
Recognizing people on social media has become a big trend in this digital age. Many companies post congratulatory messages to employees, which is an upliftment for the employees, and he feels valued. Moreover, even employee engagement platforms come with features where one can celebrate LSAs even in remote or hybrid working environments by sending wishes digitally.
Since retention is a big challenge for HRs, companies have started making LSA rewards more aspirational to motivate employees to work for the company for long years.
A local supermarket retailer in the UK, Asda, celebrated its LSA awards in July. The event was organized to recognize tenured employees. The company organized an award ceremony to make the event memorable and awarded tenured employees with 20 to 30 years of service with trophies. On top of that, the employees were given a one-week off, 100-150 Pounds cash reward, and lifetime access to employee discounts on the store.
The Paradise Group went a bit further. The company operates in the hospitality sector. It organized an event recognizing 98 tenured employees who served the company for 10 years to 25 years. The company rewarded all tenured employees with Rolex watches and Gold bars. The gesture was taken very positively by netizens, and many expressed their intention to join the company. Such acts make LSAs attractive and aspirational for others in the company. Moreover, it also builds your employer’s brand.
The LSA is also following suit since the world is moving towards the overall employee experience. This means creating moments for employees which is memorable and something that employees can experience. For instance, organizations can give a holiday experience where employees can take their families with them. As talent gains importance, companies will keep making the LSA more aspirational for their people. It will also help them to improve their retention rate.
