by Matt Alderton | January 16, 2018
Although most businesses are aware of regulations impacting their use of non-cash rewards, very few actually understand what the regulations are and how to comply with them, finds a new study published today by the Incentive Research Foundation (IRF).

Titled "U.S. Regulations and Non-Cash Awards," the study is based on a survey of 419 businesses, including 106 in the highly regulated financial services sector. Although two-thirds (67 percent) of surveyed businesses said they're aware of regulatory considerations for their incentive programs, only 38 percent of program owners said they consider themselves to be "very knowledgeable" about regulations and tax requirements.

Furthermore, fewer than two-thirds of U.S. businesses said they have formal compliance mechanisms to address regulatory and tax requirements, and 86 percent said they make some revision to their rewards program every year in an effort to comply. In fact, half make eight or more changes based on the regulatory environment, the most common of which are changes to the general program design (87 percent) and changes to program communications (85 percent).

"Most program owners understand their reward and recognition activities are impacted by the regulatory environment, but struggle with the detailed implications," said IRF President Melissa Van Dyke. "Not surprisingly, over half of U.S. businesses have increased the dollars invested into programs to accommodate changes and close to half have increased staff support. We anticipate more and more resources will continue to be dedicated to understanding and accommodating regulatory requirements for non-cash awards programs, especially as these regulations themselves continue their refinement."

A full copy of "U.S. Federal Regulations and Non-Cash Awards" is available for download from IRF's website.