Definition
An Employee Achievement Award is a formal recognition given to an employee in the form of tangible personal property. These awards are granted to acknowledge length of service, superior productivity, or exemplary safety achievements within an organization. Examples of tangible personal property include items like plaques, trophies, watches, or electronics. Such awards are an important component of employee recognition programs aimed at bolstering morale, enhancing performance, and fostering a culture of appreciation in the workplace.
Examples
- Length of Service Award: An employee receives a gold watch to celebrate their 25 years of service at a company.
- Productivity Award: A high-performing sales representative is awarded a high-end laptop for exceeding sales targets by a significant margin.
- Safety Achievement Award: An employee who has maintained a perfect safety record for five consecutive years receives a plaque and a gift card.
Frequently Asked Questions
What qualifies as an Employee Achievement Award?
An Employee Achievement Award must be a tangible item given for length of service, productivity, or safety achievements. It cannot be a cash award or a cash-equivalent like gift cards unless specially designated by company policies or tax regulations.
Are Employee Achievement Awards taxable?
These awards can be considered taxable income unless they meet certain qualification requirements under IRS regulation, such as the de minimis fringe benefit rules for small value items and specific non-cash awards up to certain limits.
Can Employee Achievement Awards be given annually?
Yes, awards for length of service or productivity can be given annually, provided they meet certain qualifying criteria and delivery guidelines as stipulated by the employer and relevant tax regulations.
What is considered a “tangible personal property” for these awards?
Tangible personal property includes physical items like electronics, jewelry, trophies, watches, or equipment. It excludes cash, gift cards, travel expenses, or similar cash equivalents.
Can an Employee Achievement Award be given as part of a retirement plan?
While recognition can occur as part of a retirement plan, the awards like employee achievement plaques or tangible items are generally separate from retirement benefits and should be awarded following relevant qualification standards.
Related Terms
- De Minimis Fringe Benefits: Small-value benefits and rewards given by employers to employees that are usually excluded from taxable income.
- Service Award: Recognition given to employees for their longevity and dedicated service within a company.
- Incentive Program: A structured plan implemented by a business to motivate and reward employees for achieving specific business goals, often including performance-based bonuses and awards.
Online Resources
- Internal Revenue Service (IRS): Fringe Benefit Guide
- Society for Human Resource Management (SHRM): Employee Recognition
- U.S. Department of Labor: Employee Benefits Security Administration
Suggested Books for Further Studies
- Employee Recognition: Low Cost & Effective Strategies for Motivate Employees by Tacey O. Rice
- The Talent Management Handbook: Creating a Sustainable Competitive Advantage by Selecting, Developing, and Promoting the Best People by Lance A. Berger and Dorothy R. Berger
- Make Their Day!: Employee Recognition That Works by Cindy Ventrice
Fundamentals of Employee Achievement Awards: Human Resources Basics Quiz
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