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Employer Advice and Tips for Handling Requests for Pay Raises


After an unspoken amount of time that staff have worked at your company, it is reasonable to consider they may ask for pay raises. So how can you prepare for and manage this conversation topic? Check out some of our tips below for best practices, as well as general employer advice.

Take Time to Respond

Regardless of how quickly you may be able to decide on the matter, take a little time before you respond. It automatically demonstrates more respect for the request—and the employee—if you are not abrupt and dismissive when you want to say no. On the other hand, even if the answer is yes, not jumping to agree will bode better for you if more similar requests arise.

Be Mindful of the Precedent

Remember that how you manage this automatically sets a precedent for future cases of requests for pay raises. Often, word can get around the office as to how you handled the entire interaction and request—from start to finish. Colleagues may discuss both personal and professional subjects with each other beyond your office. However, if you thoroughly review whether or not to grant the raise, then even if the outcome ends up differently next time, you can explain it thoughtfully to your staff.

Consider Reasons for Employee Pay Raises

Whether an employee expresses belief that he/she simply deserves to be paid more for the hard work invested, or his/her reason is more circumstantial, such as a spouse becoming unemployed, it is important to consider the specific circumstance. Try to find a balance between this and knowing you could set a precedent. To help avoid conflict altogether, consider clearly stating upfront that these requests are reviewed on a case by case basis.

Review Employee Performance

Naturally, the best reason to honour a request for pay raises is to reward employees’ excellent performance. The more valuable their work is, the more valuable you will consider them, be sure to conduct regular employee performance reviews. If they are bringing in the most business, require the least amount of guidance, meet all deadlines with ease and minimal supervision, they should know you appreciate it.

Provide a Clear Response

Ultimately, you need to let the employee in question know what you have decided. Schedule another meeting to respond professionally and in person. It is also important, however, to express your decision in writing so there is a record of the entire exchange. Clarify your reasons if saying no, explaining where they need to improve or if you simply cannot afford it. In this case, add that you will consider the raise in the future, though.