If a member of your team came to you and asked for a pay rise, what would your initial reaction be?
Would you be happy they felt they could discuss options with you? Would you be open to a discussion about the possibility of more money? Or would you – more likely – feel taken aback, irritated and possibly a little outraged?
Just why is it that business leaders often feel offended if a staff member asks for a pay rise?
Hopefully this article will help you consider the bigger picture and provide some steerage on how to make sure conversations about money result in the best outcome for you and your member of staff.
Well, this is awkward.
It’s worth remembering that asking for more money has likely been an agonising process for your team member. So as awkward as this might be for you, consider it is probably 5x more so for your employee. Acknowledge their courage.
My first piece of advice if an employee asks for a raise – regardless if you believe they deserve it – is to stay curious. Three simple words ‘Tell me more’ should open up the conversation and give you time to process. There are any number of reasons someone might ask for a pay rise, it’s important you listen to understand. A curious approach will help you figure out motivations.
- Do they believe they are underpaid in relation to other employees? Are they?
- Are they dissatisfied? is this the first indicator they are considering leaving?
- Have they taken on more responsibilities or has their job role changed?
- Is there something going on personally which means they now need more money?
Remember that pay rise conversations are legitimate conversations. Employees are well within their right to ask, even if it doesn’t happen. Have you kept to your annual reviews? Is the subject of pay well and truly on the table during these reviews? Great bosses bring up pay so employees don’t feel ‘forgotten’.
Take the request seriously
Be aware that this is very likely to impact on whether an employee stays with your company. This conversation is your opportunity to retain that person. There’s no need to say yes or no right there and then, but thank them for bringing it to your attention and reassure them that you are going to take careful consideration making a decision. Speak to HR, consider your employees contribution and look at the wider market and pay for similar roles. Don’t say yes to a rise on the basis of short term effort – perhaps they killed themselves on a specific project – a bonus would be more appropriate as reward and recognition.
Remember that as owner/manager you are there to enable the success of your team and align toward company results. If you agree the employee deserves a raise, then work with them to get what they want, while also being conscious of and transparent about business constraints. If you do not agree to the raise, help set expectations for what is needed from the employee to merit an increase – if that requires learning and development, that be sure to work that into your response.
Hopefully this article will help you re-evaluate any initial frustrations when a member of the team next asks for a pay rise.
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