Yikes, it’s happened, your report has asked for a salary increase. How do you deal with it? I just had to go through one and while each case is unique, here’s my checklist of questions to go through when considering it.
What’s the urgency? Usually a company has a review cycle for performance which includes salary review. That framework might be the place to handle it. Sometimes this doesn’t work though. Did they join at a low salary just after the last review and are performing above their current salary? Are they an immediate flight risk because the salary is very low? Are they working on an important project?
You will eventually have to deal with it anyway. So you need to start thinking about justify it right away. If you can identify and emphasize most of the following you should be able to make a case for a salary increase.
Justification from the person
Are they paid fairly? Compare their salary to their peers’ and compare to the market. Often your company will have salary bands for a role. If the salary is wildly low then they are a flight risk.
How are they performing? What’s their rating in your companies scale. If they’re excelling then specify why.
What’s their value to the company and your team? Are they working on a critical project? Do they have expertise that is unique in your team?
Justification from the business
Finally, budget. How is your business doing? How can you justify salary increase from the perspective of the business? Has someone else quit recently to make up the difference? Sometimes it will just be a question of accepting higher salary expenditure but then you case for the person better be very strong!
Pick one or more of your reports today and write an email asking for more salary for them. If you can’t, you should think about why not. A huge part of your job is their development!