"I want more money." That's a request you can hear from the mouths of top performers as well as average or even below average performing employees. Either way, it is always a difficult situation for managers, because the issues of compensation rarely depends only on direct managers. Moreover, they should take the reactions of other employees into account. The following recommendations on how to handle this situation in the best possible way were originally published on the Harvard Business Review website.
Don't decide immediately
You should not say no immediately when an employee asks you for a raise. You should not say yes either, because you can't be sure. Other things you should not say include statements like, "I'm not the decision maker here." or "I can't do anything." And watch your body language so that your face does not show anger or indecisiveness.
Want to know more
Regardless of how you feel about the employee's request at the moment, the only right response is to ask him to tell you more about why he wants more money. Write the individual arguments down. That will show the employee you are taking the request seriously. Keep a neutral face and agree that you will think the issue over and discuss it with other responsible parties. Set a specific period of time to tell the employee the result - for example, within two weeks.
Give recognition
Asking you for a raise is several times more challenging for the employee than for you. No matter what you think about the request, you should express your respect and appreciation for the employee for having the courage to talk to you. Be grateful for being given the opportunity to retain the employee before he leaves you.
Consider the individual arguments
Don't approve any request for a salary increase without making sure that it is legitimate. Does the employee really deserve more money for excellent performance or for doing more than you expect? If you believe so, do everything you can to make your superiors agree. If you fail to get the approval, don't blame your superiors for your own incapability.
How should you tell the employee he will get the raise?
Don't tell the employee that he will be paid more money because he was right that he wasn't being paid enough. You shouldn't give the impression that a pay rise is for anyone who complains. Explain to the employee that you when consulted with your superiors and HR all of you carefully considered whether his claim is justified. The employee has to see that he deserves the raise.
How should you tell the employee that the request was denied?
Explain how and with whom you consulted so that the employee can see that you took it seriously. Summarize the reasons for the rejection. Employees often don't understand the complex process of compensation and you should help them. Answer all questions and refrain from any negative evaluations of the employee as a person.
What should you do when you personally disagree with the request?
Even in this situation, you can reach out to your superiors and HR to ask for recommendations. However, if they don't agree either, it does not mean that you should tell the employee something like, "Sorry, but the boss doesn't agree." Again, mention that you considered the issue seriously and explain why you think his salary is adequate. You should also not forget to say that you appreciate his work and describe possible ways to eventually achieve a salary increase in the future.
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