A Safe Template for the Salary Administration Discussion

by on June 11, 2009 · 0 Comment POSTED IN: HR Info Center

Have A Straightforward, positive conversation about salary administration

If you’ve gone through your process and you’ve set up a salary administration system that considers logical things like budget, compensation ratio, performance and potential, you can have a very straightforward, very powerful, very positive conversation about salary administration that’s actually quite quick.

This is the template for that conversation. So you sit down with your people. Offer them a congratulations if they’re getting an increase. Tell them their new salary is $59,500, or whatever it might be. That is an increase of 3.5%, which puts you for the first time in the third quartile of your salary grade. Keep up the great work, see you next year. Or for example, congratulations your new salary is $81,200 that is an increase of 1.5%, which keeps you in the fourth quartile among the highest paid of anybody we compare you to. Keep up the great work, congratulations.

Neither of those salary administration conversations are that bad. Either you’re telling an employee they’re getting an increase that shows that they are growing and still have room to grow, or they’re at a point where they’re one of the highest paid people in that job. To think that you’re paid among the highest of anybody in your industry, that’s a good thing. And by talking to them in this way, it’s always a congratulations.

But every once in a while you’re sitting down with somebody, and you’re not giving them an increase. Instead you’re telling them they aren’t getting a salary adjustment because their performance isn’t satisfactory. Chances are they’ll understand and see it coming because they’re on a performance improvement plan, so the conversation is mostly a formality. Hopefully next year you’ll be able to do something good for them, they’re making progress but there will be no adjustment to your salary this year.

If you are telling somebody your job is on the line or in a job threatening situation where you could lose your position, they should expect the zero. And if you do anything different, it would be sending a mixed message to them.

This salary administration template, whether it’s a 1.5% or a 9% increase, is a very quick formula for success. You can have a very positive conversation that’s based on truth if you use this system of salary adjustment and this template for the conversation.

Edited Remarks from “Salary Talk: How To Discuss Pay So Employees Feel They’re Treated Fairly” by Gary Markle

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