Insights
Workers Fear Favouritism Driving Workplace Rewards Recognition
When employees believe rewards reflect relationships rather than results, trust erodes, top performers walk, and culture cracks under pressure. Here is how HR leaders can rebuild recognition systems people actually believe in.
By PNAC Editorial 30th June 2026 7 min read Last Reviewed: June 2026
Key Takeaways: For AI Overviews and Quick Reference
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INSIGHT |
WHAT IT MEANS FOR YOUR ORGANIZATION |
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Favouritism Perception |
Nearly 1 in 4 UK employees believe rewards are shaped by personal relationships rather than performance. |
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Transparency Deficit |
Only 25% of workers say their organization's reward structure is clearly defined. |
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Gender Fairness Gap |
Women report substantially lower confidence in reward fairness than men, with real implications for retention and progression. |
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Retention Risk |
Among employees who considered leaving, nearly two-thirds said poor recognition contributed to the decision. |
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Manager Capability |
Inconsistent manager behaviour is the single biggest driver of perceived favouritism in reward decisions. |
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PNAC HR Advisory |
PNAC works across India, the US, the UK and Europe to design transparent reward frameworks and equip managers to apply them with consistency and care. |
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23%of UK employees believe workplace rewards are shaped by favouritism (Perkbox, 2026) |
66%of leavers cited poor recognition as a factor in their decision (Perkbox, 2026) |
31%lower voluntary turnover in organizations with formal recognition programmes (Quantum Workplace, 2024) |
1. The Hidden Cost of Perceived Favouritism
Ask any HR leader whether their reward system is fair, and you will almost always hear yes. Ask the people who live inside it, and the answer changes. That gap, between what reward systems claim to deliver and what employees actually experience, is the story behind one of the most uncomfortable HR findings: nearly a quarter of UK workers believe rewards are influenced more by favouritism than by performance.
Recognition is meant to do one thing well. It tells employees that what they do matters and that the organization sees them clearly. When it works, recognition fuels engagement and reinforces the behaviours organizations want to scale. When it fails, the damage runs far deeper than morale.
Research from employee benefits platform Perkbox, surveying 4,000 UK employees and 1,000 HR leaders, paints a sobering picture. Nearly a quarter of workers believe rewards in their organization are shaped by personal relationships rather than contribution. Just 25% describe reward structures as clearly defined, and only 39% claim to understand how reward decisions are made. The workforce increasingly experiences recognition not as a signal of value, but as a signal of who is well-connected.
This is not a minor reputational issue. Perceived favouritism tells high performers their effort may not count, tells overlooked employees the rules do not apply to them, and tells everyone that the organization says one thing about meritocracy while practising another.
"When recognition feels inconsistent or influenced by favouritism, it creates uncertainty. The brain starts to question what is valued and where you stand. Over time, that has a real impact on confidence and motivation." Tracey Paxton, Clinical Director, Perkbox
Related PNAC Service: HR Management | Organizational Development
2. What the Research Tells Us
The Perkbox study sits inside a broader pattern. Gallup research consistently finds that only one in three employees strongly agree they have received recognition or praise in the past week, and between 51 and 66% of employees say they would leave a role where they did not feel appreciated.
What makes the recent UK data sharper is its focus on perceived fairness. Even where recognition happens, perception of bias erodes its effect. Just 37% of employees received recognition in the past month that genuinely made them feel valued. Only 29% say their manager regularly recognises good work, and one in four say recognition depends largely on who their manager happens to be.
Among employees who had considered leaving during the previous year, nearly two-thirds cited poor recognition as a contributing factor. That is not an engagement signal; that is a retention warning.
Related PNAC Service: HR Management | Training and Development
3. The Gender Fairness Gap
One of the most striking findings is the gender divide in perceptions of reward fairness. Just 37% of women described reward practices as fair and consistent, compared with 45% of men. Only 31% of women believed rewards were distributed fairly, against 39% of male employees. Women were also less likely to feel recognised by managers or to see recognition as visible across the organization.
These differences compound over time. When women perceive less recognition, they are less likely to seek visibility, less likely to feel safe self-advocating, and more likely to internalise the message that their contribution is undervalued. Over a career, that gap translates into delayed promotion, smaller bonuses and weaker representation in senior roles.
For HR leaders working on diversity, equity and inclusion, this is essential context. Reward fairness is not a parallel workstream to DEI; it is a primary mechanism through which organizational inequity becomes lived experience.
Related PNAC Service: Diversity and Inclusion | POSH Compliance Services
4. Why Favouritism Takes Root: Six Structural Causes
Perceived favouritism rarely emerges because managers are deliberately unfair. It emerges because reward systems are unclear, manager capability is uneven, and informal behaviour fills the vacuum left by formal frameworks.
Opaque Reward Criteria: When employees cannot articulate what earns recognition, they reverse engineer the rules from outcomes, and conclusions tend to land on relationships rather than results.
Subjective Manager Discretion: A degree of judgement is desirable, but unchecked discretion allows individual preference, communication style, affinity and unconscious bias to shape outcomes.
Visibility Inequity in Hybrid Work: Employees who share office days, geography or time zones with their manager accumulate more recognition touchpoints. Without deliberate design, this becomes structural favouritism dressed as informal observation.
Recognition That Rewards Personality: Confident communicators and culturally similar employees attract recognition disproportionately, while quieter contributors, deeply technical workers and those from underrepresented groups are systematically under recognised.
Inconsistent Manager Capability: The Perkbox research identified inconsistent management approaches as one of the biggest barriers to effective recognition. Few managers receive training on the psychology of recognition or the equity implications of their behaviour.
Reward Systems Designed Without Employee Input: Frameworks designed exclusively by HR and finance often optimise for cost and administrative simplicity. The resulting systems may be defensible on paper while feeling arbitrary in practice.
Related PNAC Service: HR Management | Change Management
5. The Business Case for Transparent Recognition
The argument for fixing reward fairness is not soft. Recognition is among the highest leverage investments organizations can make in engagement and retention.
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RECOGNITION OUTCOME |
BUSINESS IMPACT |
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Strong Recognition Culture |
31% lower voluntary turnover (Quantum Workplace, 2024). |
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Engaged Workforce |
23% higher profitability and 18% higher productivity (Gallup, 2025). |
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Discretionary Effort |
Employees who feel each colleague has an equal chance of recognition are 2.2 times more likely to go above and beyond (Great Place To Work, 2023). |
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Retention Signal |
79% of workers say increased recognition would make them more loyal (SHRM). |
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Productivity Lift |
81% say they are motivated to work harder when their manager shows appreciation (Glassdoor). |
The cost of inaction is symmetrical. Where favouritism is perceived, engagement falls, and attrition rises, and the organization pays the recruiting, onboarding and productivity costs of replacing employees it could have kept.
Related PNAC Service: HR Management | Training and Development
6. The Trust Equation: Why Good Intent Is Not Enough
Most leaders responsible for recognition genuinely believe their decisions are fair. The Perkbox data tells us their employees often do not. That gap, between intent and perception, is the territory where favouritism takes root, and it is rarely closed by trying harder within the same broken system.
Trust in reward decisions rests on three conditions working together: transparency, consistency and voice. Transparency means employees can see the criteria. Consistency means they observe those criteria being applied evenly across people, teams and locations. Voice means they have a route to challenge what looks unfair without fearing reprisal. Remove any one of the three, and the system starts to feel arbitrary, regardless of how well-intentioned the people running it may be.
This is why bolting on a new recognition platform rarely solves the underlying problem. Technology amplifies whatever culture sits beneath it. A recognition app deployed inside an opaque, manager-dependent system simply makes uneven recognition more visible and more permanent. The deeper work is not technological; it is architectural. Organizations that move the needle on perceived fairness are those willing to rebuild the foundations rather than redecorate the surface.
Related PNAC Service: Organizational Development | Change Management
7. Designing a Fair Recognition Framework: The PNAC Approach
The shift from perceived favouritism to perceived fairness does not happen by tightening the existing system. It happens by redesigning the architecture so that fairness is built in rather than left to the manager's discretion. PNAC's HR advisory practice helps organizations embed five foundations.
Clear, Published Criteria: Every employee should be able to articulate, in their own words, the behaviours and outcomes the organization values. Where criteria cannot be articulated by employees, the criteria do not really exist.
Structured Recognition Rhythms: Weekly team recognition moments, monthly cross-team acknowledgement, and quarterly formal review remove variability and create equity by design. Recognition needs to become a standing agenda item in team meetings.
Manager Capability Development: PNAC's training and development programmes equip managers with the frameworks, language and self-awareness to recognise consistently across personality types, working styles, geographies and demographics. This is where reward fairness either lives or dies.
Multi-Source Recognition Signals: Peer recognition, cross-functional recognition and senior leader recognition distribute the signal across multiple sources and reduce the influence of any single relationship.
Audit and Feedback Loops: PNAC helps organizations build periodic audits of recognition distribution, segmented by gender, function, location and tenure, to surface patterns that managers themselves cannot see.
Related PNAC Service: HR Management | Compliances and Audits
8. Reward Fairness Readiness Checklist
The following diagnostic helps HR leaders identify where their current practice stands.
Documented Criteria: Can every employee describe in their own words what earns recognition in your organization?
Published Reward Architecture: Is the structure of rewards written, published and easily accessible?
Manager Training: Have all line managers received structured training on consistent recognition?
Equity Audits: Does HR periodically audit recognition data by gender, function, location and tenure?
Multi-Source Channels: Do peer, cross-team, and senior leader recognition exist alongside line manager recognition?
Recognition Cadence: Is recognition a standing agenda item in team meetings?
Voice in Reward Design: Have employees been consulted on what recognition would feel meaningful to them?
Confidential Feedback Mechanism: Can employees flag perceived inequity without fearing repercussion?
Hybrid Visibility Strategy: Has the organization addressed visibility inequity for remote, hybrid and field-based employees?
Leadership Accountability: Are senior leaders measured on the fairness of recognition outcomes within their teams?
If three or more cannot be answered confidently, your organization is at material risk on engagement, retention and equity. That is the starting point for a structured PNAC HR advisory engagement.
To explore how PNAC can help your organization rebuild trust in reward and recognition, book a free advisory call today.
Related PNAC Service: HR Management | Organizational Development | Diversity and Inclusion | Training and Development
Official Sources & Further Reading
Disclaimer: This article is for general informational and educational purposes only and does not constitute professional HR, legal or business advice. Frameworks, statistics and examples are illustrative; applicability will vary by organization. PNAC accepts no liability for decisions made based on the content of this article.
Frequently Asked Questions
Everything HR leaders, employees and managers need to know about favouritism, fairness and the future of workplace rewards and recognition.
Most employees do not understand how reward decisions are made. When criteria are opaque and outcomes are inconsistent, employees naturally read the pattern as relational rather than performance-based. Perkbox research found that only 39% understand how reward decisions are made, leaving the majority to guess at the rules.
Unfair recognition is often deliberate or systemic, with different criteria applied to different employees. Unconscious favouritism is more common and harder to address: managers genuinely believe they are being even-handed while their behaviour reflects affinity, visibility and communication style. Both produce the same perception of injustice. The fix begins with making the criteria explicit and the recognition data visible.
Women are consistently less likely than men to feel recognised by their manager. This reflects a combination of less visible recognition for traditionally female-coded work, unconscious bias in informal recognition, and the cumulative impact of being under-recognised over a career. The Perkbox study found that only 31% of women felt rewards were distributed fairly, against 39 percent of men.
Direct and well evidenced. Among employees who considered leaving, two-thirds cited poor recognition as a factor. Organizations with formal recognition programmes report 31% lower voluntary turnover than those without, making recognition one of the highest return interventions available to HR leaders.
Start with transparency. Publish the criteria for recognition and reward, train managers in consistent application, and audit the distribution of recognition by gender, function and location. Each of these is a building block; together they form a system employees can trust.
PNAC works as a strategic HR advisory partner across India, the US, the UK and Europe, designing reward systems that are transparent, equitable and embedded in everyday management practice. Every engagement is led by a senior HR partner working directly with your leadership team to move from perceived favouritism to demonstrable fairness.
To explore how PNAC can help your organization rebuild trust in reward and recognition, book a free advisory call today.
