Friday, 20 May 2016

Five steps to asking for a payrise

As we are coming up to the end of the Australian financial year, many employers start their performance review process. This can be an excellent time to discuss with your Manager your performance for the past period, your development goals.... and.... your salary...  

The reality is that many Managers feel cornered and uncomfortable with requests for a pay rise. They are often not equipped or empowered by the organisations they work for to be able to have these discussions. This means both of you can leave the conversation feeling dissatisfied and unsure of the future.

Instead of talking about pay rates, instead make the conversation about your value to the organisation. In the past, but also into the future. Steer the discussion in a constructive way. Development is not just about promotion, you can be happy to stay in your existing role but be open to developing broader skills, or a deeper understanding of the organisation or industry. This makes you of more value to the organisation, and gives great justification for a salary increase. 

Before you have any discussions with your Manager, first do your research and follow these five simple steps:

1. How are you paid? 

If you have a structured pay grade system through your Enterprise Agreement or Award, then you should first refer to that. Is there any information there about how to progress through the pay grades?

2. What are your Company policies?

If you are a salaried employee, or your EA/Award does not contain a provision for salary reviews, then you need to check your Company policies. Be aware of what is required for a salary review to take place, and what time of year these tend to be considered. Be prepared for the policies to be fairly vague, though, so it can help to have a chat to someone that you trust who has worked in the organisation for a while about what the usual practices are.

3.What is a usual market rate?

Be careful here as you will be able to find your role in another Company for more money 99% of the time searching through Seek. So the key is to look at what most of the ads in your work area (city/area of the city) have as pay ranges. An even better source of information is salary guides like the Michael Page salary and employment outlook. Use this information more as an internal guide for yourself. If you feel you are well underpaid (more than 20%) then it is worth bringing it to the table and asking the question about how to get yourself back to market rates.

4. Approach your Manager

Make sure you read and understand the requirements (EA/Award/Policies as above) and discuss these with your Manager. It can be a good idea to do this at the end of your next performance review so that the discussion is seen as one about how you want to develop yourself and add value to the Company. Not just how you want more money.
Be prepared with information about how you think you have met the requirements AND what help you need from your Manager to develop and achieve the next level. Make sure you complete any paperwork needed to submit to achieve the next grade. Remember, this is your pay rate and you need to take the front foot and make it as easy as possible for your Manager to sign where required!

5. Follow up 

Be patient, but follow up. If, after a month, you haven't anything, then you should bring it up at your next catch-up with your Manager.

Should I put a request in writing?

This can depend on your organisation, but generally speaking you should try and have the discussion with your Manager first and then follow up with something in writing. Depending on your organisation, there may be a particular form to be completed, or you can put your case forward in an email referencing the earlier conversation.

A special note for salaried employees
When you are salaried (earning above the Award ; employed on a contract of employment), pay rises are at the discretion of the organisation.
If your Company has no policies in which to guide you, then think of how to build your case for a salary review.

Some relevant factors to have prepared:

  • How long have your worked for the organisation and any pay rises you have received
  • The CPI over that same period (i.e. have your salary increases kept pace with inflation?)
  • Market rates (see #3 above and remember to not be entirely reliant on this information)
  • Your performance and how that has been above expectations

There can be a temptation to try and discover what others in your organisation are paid, and to compare yourself to others. This is not a good strategy because their pay rate is irrelevant to you. Even if you feel like you are doing the same job, everyone brings different skills and experience to the table. Try and keep focussed on your own circumstances and relevant external factors such as the market and CPI.

And if the answer is no, or the raise is less than you expected?
Ask questions. Find out what you can do in the future to have a different outcome. If it is simply that the organisation has a freeze on salaries, then you will need to decide on what is more important - trying to gain a role elsewhere or waiting it out.

Best of luck!

Do you have a story to tell about asking for a pay rise? Feel free to share!

Photo credit: Auburn Alumni Association via VisualHunt / CC BY

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