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Danny Chung
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Stephen Crowe

Managing Director

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pay rise

“I want to discuss my salary package”

“Can I have a raise?”

These two phrases can cause a lot of frustration and uncertainty in the workplace if not handled sensitively.

 

 

First of all, it isn’t easy to ask your boss for a pay rise.  A lot of anguish, thought and hopefully research has probably occurred before the employee has come to you.  So, if you know an employee is due for a pay review take the initiative and raise the discussion before they feel they must.  But if they beat you to it, give each request a lot of respect.  Listen to the case presented and take time to consider.  This will usually mean not giving an immediate answer so agree on a time and date to meet to discuss your decision.

From an employee’s perspective getting a pay rise is pretty simple, have I performed well enough in my job to deserve it?  From the employer’s side things appear bit more complex.  Apart from performance, employers need to consider how the salary compares to the market generally, how the salary compares to others in the team, whether the company is in a position to give a pay rise and does the requested pay rise fit within the companies’ policies?

If you’ve decided not to give an employee a salary increase how you communicate it is pretty important.  Of course, every scenario will be different but usually the outcome you are looking for is similar; although you are not going to reward the employee with more money you want them to stay focused on their job and maintain or improve their performance.

This isn’t a comfortable situation for the employer or the employee.  The answer though is to be tactful and honest.  If the employee’s performance wasn’t where you wanted it to be, carefully explain where they were below expectations and, if possible, use data to illustrate.  Then try and plan a clear performance path to the point where you would be able to give a pay rise. This should be as transparent as possible so the employee can easily understand if they are on track or not.  If the employee’s performance has been adequate but the businesses situation does not allow you to give a pay rise or the employee is already well paid in market terms again, be open about why you can’t pass on a pay rise at the moment, but also look for alternatives that will be seen as a reward.  These alternatives may include training, flexible working arrangements and additional holiday days.

Salary negotiations are sometimes tough to handle, but it is pivotal that employers plan for this process, as it is inevitable. The more proactive you are now, the less reactive you will need to be later.