Nobody should feel embarrassed about marching into the boss’s office for an increase - if they go about it with the right attitude.
Many Kiwi firms try to avoid this situation by pro-actively finding out what the market wage is and then meeting it, but they are prepared to listen to people wanting more, if they put forward a good case.
Recruitment consultants Amanda Van Ryn of Sapphire Technologies and Barry O’Brien of Enterprise say it is essential to do your homework and produce a "mini-business plan" outlining your case. Look at what your colleagues are earning and what other organisations pay the same roles.
Furthermore, look at the value you add to the company, what skills you have developed, what responsibilities you have gained and what training you have done since the last pay review.
“Once you have gathered this information prepare a letter documenting the above with a conclusion stating your value on the open market and on that basis justifying your requirement for an increase,” says O’Brien.
“Arrange a meeting with your boss and verbalise your situation and then leave him with your letter. This is an excellent acid test of your value and future with any organisation.
“In today’s market, any company that does not give you a sympathetic hearing , if you have done your homework right, is probably either in trouble or does not value you that highly and you should start looking [for another job].
“The very least that should come from this is that your boss will design a pathway through objectives to achieve an increase,” he says.
Van Ryn agrees it is unwise to just ask for a pay rise without factual back-up explaining why.
“It is also important to have in mind what dollar figure or other benefits you are seeking in the rise. Go with what you would ideally like, but also be prepared to negotiate a little, as this is generally the norm,” she says.
However, most employers aim to be pro-active by paying the going market rate. Clear and Unisys, for example, have annual processes keeping wages at market levels.
And they say workers can find information on market wages on the Internet or by staying in touch with employment agencies.
“As the market shifts, the renumeration shifts with it. People who are unhappy with their pay will simply vote with their feet and walk away,” says Clear HR director Peter Merry.
However, he feels a business plan is too formal. “A practical manager will say ‘let’s talk about it'." Merry says if you are a valued employee, they will want to keep you.
Unisys HR director Ken Goodwin says most people receive their raise during the company's annual salary round, but often people ask for more. Dissatisfied people should establish their worth and approach the company before they find another job elsewhere, Goodwin says.
“The last thing we want is quality people walking out of the door after we have invested in their training; the cost of replacing staff is so high. But we are only prepared to pay so much,” he says.
U-Bix general manager Sheree Tootell says her company’s pay rates are based on market information.
“We aim to be pro-active rather than waiting for someone to become dissatisfied and need to ask for a pay rise. The worst possible thing I can have is for a member of staff coming to me and say they have go a job elsewhere paying so much and if we match it, they will stay.”
Similarly, the Advantage Group in Auckland looks at qualifications, experience and the going rate. “If someone came to me personally, I would look at what they do above their job - the added value they bring,” says HR director Philippa Furlong.
She too says she can offer training to help people achieve their goals, but adds those aged over 25 often want other benefits, such as flexible working hours and loans to buy company shares. “We have to be aware of what makes people tick and what motivates them,” she says.
To avoid being underpaid, other advisors say workers should investigate a company by looking at media and company reports and trying to find out about its culture, before they even join. “It’s worth it because it is easy to be mis-sold a job, “ says Sophie Rowan of Career Psychology in central London.
In addition to the Kiwi experts above, she also offers the following tips.
- Put salary in the context of other factors such as job satisfaction and career prospects.
- Get your timing right. Companies like to have a formal structure for pay rises, after appraisal for example. Regardless of the strength of an employee’s case, they may not want to set a precedent.
- Finally, be assertive. Looking happy with your job and pay may make the boss question your ability.