State any five Monetary Incentives and five Non-Monetary incentives which contribute to the performance of employees.

Answer – Financial incentives

Financial incentives can be expressed in money and reward performance or service.

• Pay and allowances: basic salary and related allowances meet regular financial needs.
• Productivity-linked wage incentives: additional payment is linked to output or performance.
• Bonus: an additional reward over normal wages, according to the applicable arrangement.
• Profit sharing: employees receive a share of profits, aligning interest with organisational results.
• Co-partnership or stock options: employees obtain ownership interests under specified conditions.
• Retirement benefits: provident fund, pension or gratuity support future security.
• Perquisites: benefits such as housing, medical facilities or transport add value beyond cash salary.

For example, a clearly defined output bonus can encourage greater productivity, provided quality and safety standards remain protected.

Non-financial incentives

• Status: designation and responsibility provide recognition and prestige.
• Organisational climate: trust, fairness and supportive relationships create a positive workplace.
• Career advancement: opportunities for promotion and growth encourage effort.
• Job enrichment: meaningful, challenging work with greater responsibility builds satisfaction.
• Employee recognition: appreciate worthwhile achievements through praise or suitable acknowledgement.
• Job security: reasonable assurance of continuity reduces anxiety.
• Employee participation: involve employees in decisions affecting their work.
• Employee empowerment: grant authority and resources to take relevant decisions.

Different employees value different incentives. Recognition should be specific and fair; empowerment requires genuine authority, not responsibility without resources.