Payment between family members

We own the land, and have a relative who does extensive work on the land.

We do not have to pay anything, but by choice, we do.

The land is family owned, not an investment property or anything like that.

By choice this relative does the work, and by our own choice, we want to pay him for his work.

So when payment is made, do these "payments" count as income for this person, or is it considered a gift?

I felt sure it would have to be reported, since we are doing it regularly, but I want to know for sure.