Randall S. Peterson: Should employers reward employees for healthy habits?

Healthy Habits

I believe employers should encourage healthy habits, but it’s very important to be careful about how it is incentivised. Rather than directly monetising healthy living or giving a certain number of extra days’ leave, it’s better to look at it from the perspective of encouraging employees to internalise their own desire to look after their own health.

For most employees, a key factor in increasing their engagement at work is for business leaders to provide an enjoyable and supportive work environment, one that supports their personal values. One way to do this is by making it easier for people to go to the gym and do exercise. The whole question of rewarding people for certain behaviour relates to how staff are engaged; in a recent study carried out at London Business School we found that employee engagement was the overriding concern facing executives.

But if employers start to reward employees in direct ways for adopting certain habits, after a while, staff are likely to start thinking that they’re behaving as they do because of the payment. Rewarding a previously unrewarded activity can undermine any intrinsic motivation the individual previously felt, something called the ‘over-justification’ effect, which is likely to prove counter-productive and ultimately reduce employee engagement.

So, I urge leaders of organisations to focus on helping staff to find meaning in their nine-to-five jobs and nurture a sense of purpose about their employer by encouraging and supporting employee’s native interest in their own health, but not to incentivise it directly by offering money or time-off. This will encourage employees to see that their employer facilitates their personal goals, rather than attempting to dictate or demand that they act in certain ways. When they do this, staff are also more likely to bring their best self to work, be happy in their role and be more productive.

Randall S. Peterson is professor of organisational behaviour and executive director of the Leadership Institute at London Business School