Nobody likes talking about money, especially when somebody is asking you for more of it. But for managers, money talks are part of the job description. So what do you do when your direct report hits you up for a raise? Here are 5 smart ways from RPO solutions experts, Hire Velocity —and one terrible way—to respond.
5 Things to Say When Someone Asks for a Raise
When an employee asks you for more money, bear in mind that he or she has put a lot of thought and effort into that moment. Most people don’t ask for a raise on a whim. They plan the conversation carefully, gather all their supporting evidence, and choose just the right moment to broach the subject.
The worst thing you can do is blow them off. Here are 5 things you can say to steer the conversation in the right direction.
- “Tell me more.”
Never react right away, either positively or negatively. It’s likely that you will have to get approval from someone else before making a final decision, so don’t raise false hopes. But don’t knock the wind out of the employee’s sails immediately either. Take the time to actively listen to her request and communicate that you value her contributions. “Tell me more” lets the employee know you’re listening without undermining your authority as a decision-maker. Take notes and carefully control your body language so you don’t send a negative message. - “I appreciate your request.”
Acknowledge the fact that the employee has gone out on a limb to ask for more money. He may be making a bid for higher compensation before accepting a position elsewhere, so consider the request in light of possible retention ramifications. If the employee’s role or performance doesn’t warrant an increase in salary, it’s still important to give him a fair hearing and consider his reasons for the request. - “I’ll get back to you in two weeks.”
Don’t give an answer right away. Instead, say you’ll consider the information she’s presented and give her a date when she can expect a response. Allow yourself enough time to review her self-analysis and do your own research into her performance. Look for indicators that the employee deserves additional compensation based on performance, internal equity, or fair market value. Look at salary data for your industry, specific results the employee has achieved, how long she has been with the company, and how difficult it would be to find a replacement. - If the answer is yes: “We discussed your performance, and we believe a raise is warranted.”
Base your answer on the research you’ve done, not on subjective feelings. Remember, other employees may be watching to see how things turn out. Make it clear why you agreed to the request and emphasize that it was a collective decision based on the value of the employee—not on how hard he begged for it. - If the answer is no: “We considered your current role and responsibilities, and we believe your compensation is appropriate.”
Let the employee know that you evaluated each of the arguments presented in addition to conducting your own research. He or she should understand that you took the request seriously and gave it careful consideration. Explain the compensation process and offer some suggestions for increasing the chances of a yes.
One Terrible Way to Respond to a Raise Request
It’s easy to feel irritated when an employee comes to you about a raise, especially if you don’t think he deserves one. Still, he has put a lot of effort into formulating that request and he probably feels vulnerable as he sits awkwardly in front of your desk.
And that’s why you should never criticize the employee for asking.
Even if money is tight and the answer is no, you can still respect the employee’s contributions and provide useful feedback based on your knowledge of his performance.
Good management is about helping employees reach their potential and make valuable contributions to your company. Whether the answer is yes or no, discussions about compensation can serve as beneficial coaching opportunities. Don’t miss the chance to help your employees become more effective contributors—no matter what your answer turns out to be.
