Pay · HR glossary

Incentives

Incentives are rewards intended to encourage particular actions or outcomes. They may be financial or non-financial and can apply to individuals or groups.

By SmallHRTools · How we write definitions

Example

A team receives an agreed reward for reducing avoidable processing errors while maintaining service times, with both conditions included in the scheme.

What to keep in mind

Choose measures carefully because incentives can change behaviour in unintended ways. A reward based only on volume may encourage rushed work, so include relevant quality and fairness safeguards.

Further reading

← Browse all HR terms