Why it’s important to keep your employees happy (+ 16 ways to do it)

According to the US Bureau of Labor, 76.1 million workers aged 16 and older are hourly workers. That’s more than half of all wage and salary workers. With many of them spending at least 30 hours of their week at work, it’s important to make those hours as rewarding as possible.

Additionally, creating a happy work environment that allows employees to thrive, is the key to increasing retention rates. And for small businesses that are growing and evolving, it’s more important than ever to avoid losing your top workers to your competitors.

That’s why, in this piece, we’ll walk you through the importance of employee happiness and give you our top 16 tips that will help you increase the positive workplace vibes to benefit both your business and team culture.

Why is it important to keep your employees happy?

Defining happiness at work is a complicated task. However, studies show that providing employees with physical, psychological, social, and organizational resources leads to improved performance and mood. This positive outlook brings:

  • Greater productivity. When people find satisfaction in their work, they’re more likely to be engaged and put effort into accomplishing their responsibilities and doing good work.
  • Smart decision-making. Higher employee morale means less anxiety and unnecessary stress during work. Relaxed team members tend to make calculated choices and avoid needless risks.
  • Higher employee retention. Providing a healthy workspace reduces turnover rates and the risk of absenteeism. This means you’re unlikely to lose your best employees to your competition.
  • Better customer service. Naturally, team members with a more enthusiastic mindset are more likely to be kind and attentive when dealing with customers. This increases customer loyalty and ultimately, positively affects your bottom line.
  • Improved employee health. Giving employees the resources they need, like competitive pay and flexible working hours, reduces anxiety and improves mental health which leads to better physical health.

16 ways to increase employee happiness

Discovering ways to create a happy work environment and achieve business success can be difficult. That’s why we’ve created a list of 16 ways to increase employee happiness to get you started:

  • Offer competitive pay
  • Provide time off generously
  • Allow flexible shift changes
  • Encourage regular availability updates and real-time shift tracking
  • Offer discounts and freebies
  • Create opportunities for professional development
  • Organize volunteer work
  • Cover, or assist with, transportation costs
  • Offer free or discounted childcare
  • Assist with parent care
  • Help pay off employees’ student loans
  • Allow casual attire
  • Redesign your work environment
  • Foster teamwork rather than competition
  • Insist on honesty and transparency
  • Express gratitude

1. Offer competitive pay

Fair and competitive compensation is a great way to make employees feel appreciated and reduce their financial stress so they can do their best at work. While this can be challenging for some small businesses, it’s vital to beating your competition to the best candidates. This makes it worth the investment.

When writing a job description for a new hire, make sure to get a ballpark figure for the role through a salary survey or website. Then, try to match or even exceed that number. If you’re not able to meet the market-rate salary for that position, then make up for it by promoting a competitive benefits package.

2. Provide time off generously

Giving your employees more time off allows them to have a healthy work-life balance and pursue other interests. Additionally, it helps them feel recharged and eager to get back to work.

If you can’t afford for them to take a long stretch of time off at once, you can offer half days, one Friday a month off, or an extra day after a three-day weekend.

Shorter spurts of free time also make it more likely that employees will take advantage because they don’t require much planning and your employees won’t have to worry about how their work is going to get done.

3. Allow flexible shift changes

One easy way to keep your employees happy is as simple as rewarding their hard work with more flexible scheduling that allows them to work when they’d like to work. Because everyone is different and they might feel at their most productive at different times of the day. Some employees might be night owls while others are morning people. Enabling this flexibility lets your team manage their personal lives much better and maintain their own best personal schedule.

Also, things come up, sometimes at the last minute. It’s important to let employees trade shifts with each other easily. This helps reduce the anxiety of the employee who can’t make it to work and even gives another team member a chance to work some extra hours and earn more money.

With Homebase, you can allow employees to trade shifts on our mobile app. A manager will always have to approve the swap, so you can be sure that the replacement is trained for the role.

4. Encourage regular availability updates and real-time shift tracking

Getting advanced notification of availability changes is a win-win for both you and your employees. It gives you a little extra time to find someone to cover open shifts if you need to and allows your employees to have a more flexible work schedule.

Team members should be able to adjust their availability in advance, meaning if they can work Tuesday this week, but can’t work Tuesday in two weeks, they can inform everyone of that information as soon as possible. This makes scheduling easier for you and means team members who aren’t working won’t be called in at the last minute.

Homebase’s employee scheduling software helps you optimize your scheduling, track and manage availability and time off, and even post open shifts for employees to claim.

5. Offer discounts and freebies

If you sell products or services to customers, you can offer them to your employees at a discounted rate, as a part of your benefits package. This boosts employee loyalty and can even positively affect your bottom line. That’s because this option allows employees to invest back into your business.

But you don’t have to limit these freebies or discounts to your inventory. You can also provide:

  • Free ice cream. This is a great way to relieve stress and take a short break from work. You can also buy the suites at a discount if you have a wholesale license.
  • Professional masseur services. You can hire a licensed individual to come in one or two days a week to give free massages during work hours to employees who book them in advance. Other useful perks for improving physical health include yoga classes or gym memberships. You could also put an exercise hour in the middle of the day that encourages employees to take a walk, play a basketball game, or engage in exercise.
  • Discounts for other goods and services by teaming up with local businesses. Collaborating with different vendors and offering discounts to each other’s staff creates a sense of community in addition to acting as an extra incentive.

6. Create opportunities for professional development

Many workers look for more than just a paycheck from their jobs. They also want to advance their careers and develop their skills. In fact, according to a survey conducted by LinkedIn and Glint, “employees want to follow their skills and skilling potential — even if it means leaving their current employer.”

One way of helping them achieve their goals is by offering in-house professional development and training opportunities for free. You can conduct training and mentoring programs either at your location or a place that is nearby on topics that are relevant to their jobs.

You may even be able to ask some of your senior employees to lead these classes.

Another possibility is to invest in training at a local community college or business institute. You won’t have to give up space at your facility for sessions and will reward employees with a wider variety of courses to choose from.

7. Organize volunteer work

Many employees like to work for businesses that include a sense of community in their organizational values. A good way to show your investment in that value is by providing your team members with the possibility to volunteer for local organizations on company time.

Additionally, this can increase visibility for your company and differentiate your business from your competitors.

8. Cover, or assist with, transportation costs

It’s no secret that commuting can take its toll on employee productivity and personal finances. Having to deal with fluctuating gas prices, traffic, or being late due to longer distances causes your employees unnecessary stress.

This is especially troublesome when transit is a crucial part of running your business. For example, delivery services, construction, gardening, and home services like cleaning or plumbing.

A stipend for monthly transportation can ease the emotional and financial burden. You can also encourage workers to use public transportation by offering bus passes or train tickets. This investment ultimately helps your bottom line by reducing employee turnover.

9. Offer free or discounted childcare

Many of your employees may be members of families where both parents work. Having to worry about how to take care of children can impact work time negatively. Some may have even bent the truth to you about their family life in order to maintain their work conditions. Parents might also be forced to use a sick day when childcare plans fall through. For hourly workers, this means losing a day’s income.

Studies also show that the burden of unpaid care, such as childcare, is disproportionately carried by women, which means struggles with childcare keep women out of the workforce at higher numbers than their male counterparts. Even more so for black and Latina women in the United States, according to Fortune.

You can alleviate this stress and retain employees by providing free childcare at work or at a nearby location. Your employees will feel better knowing that their children are close by and will be able to focus more on their job.

If that’s not feasible or realistic for your business, consider collaborating with a local community daycare to grant employees childcare vouchers and other, similar functional benefits that can greatly improve their daily lives.

10. Assist with parent care

The AARP estimates that there are currently over 40 million unpaid caregivers in the United States. Employees who are caring for aging parents will naturally experience more anxiety and pressure at work. They might have to work fewer or more irregular hours and take paid or unpaid time off to take care of family.

Offering assistance with parent care can be as simple as giving referrals and resources that help caregivers deal with lifestyle changes and emotions involved. You can also provide flexible shift changes, paid caregiver leave, or even paid backup care.

If it’s feasible for you, you can even consider negotiating contracts or hiring services that assist with finding legal representation or long-term-care facilities.

11. Help pay off employees’ student loans

If your workforce consists of college students, they’ll be thrilled to have a little help with staying on top of their student loans. While you probably can’t afford to pay off entire obligations, you can offer to put up a set amount each month.

You can start by contributing $50-$100 a month. This might seem like a small amount, but it all adds up to save employees up to thousands of dollars in interest. This initiative increases employee loyalty, engagement, and retention rates.

According to the provision included in the pandemic relief legislation of 2020, employers can offer employees up to $5,250 a year as a tax-free student loan repayment benefit through 2025.

12. Allow casual attire

Many companies offer casual Fridays, which allow employees to relax their attire at the end of the working week. You could extend this concession to every day of the week as long as you specify what is and is not acceptable in the workplace.

Letting your employees wear clothing they’re comfortable in increases happiness in the workplace because employees are able to express themselves more freely and be themselves. Removing dress codes that often enforce negative stereotypes also promotes diversity in the workplace and the recruitment pool.

13. Redesign your work environment

Improving your workplace’s overall conditions is a great way to make the time your employees spend working more enjoyable and productive. Some things that can improve your work environment include:

  • Getting lots of natural daylight. 
  • Including air purifiers if your business is located in an area with pollution.  
  • Having humidifies during the winter when the air is especially dry. 
  • Offering free Wi-Fi access to employees.  
  • Including low-maintenance green plants to improve mood and reduce anxiety. 
  • Coloring the walls of the location to calming colors like green and blue or mood boosting ones like red and yellow.  
  • Providing menstrual products and sanitary bins in the restrooms.  
  • Investing in comfortable and ergonomic furniture like chairs and stools that are especially helpful for employees who have to be on their feet for long periods of time.

14. Foster teamwork rather than competition

Keeping score as a manager and encouraging competition among your employees can have a negative effect on their motivation and overall productivity. Not to mention it can lead to a toxic work culture and in-fighting.

Instead, try encouraging teamwork and ensuring your employees that they don’t have to outperform their colleagues constantly. This reduces excessive stress and inspires employees to find creative solutions to challenges by collaborating with their team.

15. Insist on honesty and transparency

Having a transparent and honest culture means your employees are always in the loop and feel safe about coming to their manager about any questions or issues they might be having. This boosts morale and creates psychological safety at work, meaning your team members aren’t afraid of being humiliated, punished, or rejected for speaking up.

Another way you can encourage transparency is to always keep employees informed about upcoming shift changes, schedules, hours worked, and earnings. Giving them easy access to the status of their time off requests, upcoming shifts, and tips helps make sure they never feel caught off guard by any changes. Having everybody on the same page at all times increases motivation and productivity.

16. Express gratitude

Employee recognition doesn’t always have to be in the form of a grand, expensive gesture. What matters is that you acknowledge your team’s hard work and take the time to show gratitude for what they do in whatever way is possible for you. Some of the ways you can thank your team include:

  • Implementing financial rewards or non-financial benefits, like extra time off, for certain achievements or milestones.
  • Handing out prizes or vouchers at company events and celebrations.
  • Encouraging managers and supervisors to frequently provide positive feedback to their team.
  • Using team meetings as an opportunity to shout out your team for their good work and motivating peer-to-peer recognition.
  • Welcoming your employee’s constructive feedback about the workplace, their shifts, and leadership. For example, Homebase allows you to gather feedback from your team at the end of every shift so you can better understand how your employees feel.

3 ways to measure employee happiness

Measuring happiness can be elusive and difficult. But here are our three recommendations that might make that task easier for you and your team.

Conduct employee surveys

Using employee satisfaction surveys is a great way to go straight to the source and directly ask your employees about how they’re feeling. The responses should give you the opportunity to identify and prioritize problems and find solutions that lead to happier employees.

Try to keep the surveys short and to the point, so your team feels more motivated to take them. Additionally, making the surveys anonymous encourages employees to give their honest opinions more easily.

Some questions you can include in your survey are:

  • Do you feel fulfilled by your daily tasks and responsibilities?
  • How would you rate your overall mood at work in the past X months?
  • Do you feel a sense of purpose at work?
  • How often do you feel stressed at work?
  • If you could change one thing about the workplace or the environment, what would it be?
  • If you were the manager for a day, what’s the first thing you would do?
  • Do you feel fairly compensated for your role?
  • What benefits or perks do you think are missing?

Gather feedback whenever possible

Encourage your team members to feel comfortable about offering constructive feedback whenever possible. Creating a work culture that encourages frequent feedback means you or your employees don’t have to wait for quarterly, or monthly, surveys to bring up any areas of improvement. Instead, you can meet challenges head-on and address them before they become bigger problems.

For example, you can use a tool like Homebase to collect feedback from employees at the end of every shift. If the shift was chaotic because the dishwasher broke for the second time, your team can let you know so you can find a solution. Or if the shift was particularly busy, it might be that you’re understaffed and should assign another employee to that shift.

Schedule 1:1 meetings

1:1 meetings provide a great opportunity to gather feedback. They allow your team to voice their opinions and discuss issues that they might not otherwise be comfortable sharing in public. Having more authentic conversations gives you a chance to establish a positive rapport with your employees and make them feel heard.

We recommend scheduling these face-to-face meetings as regularly as your work allows. Try to opt for once a week or every two weeks.

Homebase helps you attract and retain top applicants

Employee job satisfaction and happiness is a hard concept to pin down. But the success of small businesses depends on the fulfillment and engagement of their employees. At Homebase, we pride ourselves on helping you keep your team motivated and happy by making scheduling a breeze, offering earnings transparency through our mobile app, and making it easier to run payroll so your team always gets paid on time.

Our hiring and onboarding software sets your team members up for success from the very beginning by ensuring a smooth transition to the business. Finally, our team communication app simplifies day-to-day messaging, allows you and your employees to acknowledge each other for a job well done, and gives your team the information they need when they need it.

FAQs about employee happiness

homebase customer photo homebase customer photo

What makes employees happy at work?

The factors that make employees happy at work can differ based on the industry gender. However, according to Glassdoor, some of the most important contributing factors to employee satisfaction include:

  • Alignment with company cultures and values
  • The quality of senior leadership
  • Career and development opportunities
  • Business outlook
  • Work-life balance
  • Compensation and benefits

How to keep employees happy and motivated?

Creating a work environment that contributes to employee well-being helps your small business attract top talent, retain your current team members, and offer better customer service. Here are 16 ways you can keep your employees happy and motivated at work:

  • Offer competitive pay
  • Provide time off generously
  • Allow flexible shift changes
  • Encourage regular availability updates and real-time shift tracking
  • Offer discounts and freebies
  • Create opportunities for professional development
  • Organize volunteer work
  • Cover, or assist with, transportation costs
  • Offer free or discounted childcare
  • Assist with parent care
  • Help pay off employees’ student loans
  • Allow casual attire
  • Redesign your work environment
  • Foster teamwork rather than competition
  • Insist on honesty and transparency
  • Express gratitude

What are some of the great ways to increase employee productivity?

The key to increasing employee productivity is creating a workplace culture that prioritizes employee well-being and satisfaction. Some of the ways you can boost employee morale include:

  1. Set realistic short and long-term goals to motivate your team members
  2. Provide regular feedback
  3. Acknowledge hard work
  4. Help them avoid burnout by ensuring a healthy work-life balance
  5. Offer flexible working hours and scheduling
  6. Create opportunities for training and professional development

Remember: This is not legal advice. If you have questions about your particular situation, please consult a lawyer, CPA, or other appropriate professional advisor or agency.

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