How to deal with a pay rise request

If business is booming, it’s down to the hard work of both you and your employees. And when things are going well, it’s always good to reward staff for their hard work, maybe with some extra time off, a bonus or even a pay rise.

But while it’s relatively straightforward to offer an employee a pay rise on your own terms, what if an employee comes to you asking for a pay rise, or even demanding one?

Last week, we showed you how to ask for a pay rise, here’s the flip-side – how to deal with a pay rise request.

How to respond to a pay rise request

The first thing you need to consider when an employee comes to you with a pay rise request is whether you think it’s a reasonable request. If so, it should be a relatively straightforward process. If not, then a bit of diplomacy might be called for. In either case, you should always take time to consider the request, if only to give yourself some time to come up with solid reasons, either for or against.

If you’re in charge of a larger organisation, you’ll probably find any salary increases are restricted by pay scales and employment bands. If this is the case, it’s likely that employees will be well aware of this and will only ask for an increase in line with these restrictions, if at all.

If you work in a smaller business with a less rigid pay scale system, then an employee might be more likely to come forward with a pay rise request, and one that is a little higher than you might reasonably expect. In this instance, you need to formalise the request and include it as part of that employees performance or pay review (it’s always a good idea to conduct a number of pay rises all in one go, to save on accounting admin, if nothing else).

How to manage employees salary expectations

The best way to manage salary expectations is to have a structured pay scale and conduct regular pay reviews, where you can fully explain how and why salaries are reviewed – employees can react badly to a pay rise if it’s not as much as they were expecting, so it is important to manage their expectations by fully justifying your decision.

On the other hand, if you’re going to offer a pay rise that is more than the employee was expecting, you should also fully justify this decision, particularly as other employees may feel they’re entitled to the same level of pay rise. This is a good opportunity to praise the specific employee, and try to encourage the same level of performance in other employees.

But it can also bring its own problems along with it.

How to discourage multiple pay rise requests

The best way to discourage multiple pay rise requests is to have a robust salary review procedure in place.

Although this can sometimes seem quite arbitrary, and something that employees don’t take particularly seriously, having them evaluate their own performance before undergoing a further pay review is  an effective way to focus employees minds on their own achievements and value. It can also discourage multiple pay rise requests coming in at once.

How to turn down a pay rise request

Having to turn down a pay rise request is not something any manager looks forward to, so it’s important to try and focus on the positives in this situation. Always be constructive with any feedback, and offer ways in which the employee can reach the required standard, preferably by the next pay rise review.