The Do’s and Don’ts of Talking About Pay Raises

While it may seem like talking about a pay raise with an employee is always a positive conversation, a manager must broach this topic carefully, as it can also be a highly sensitive one. You think you’re delivering great news as you offer a certain percentage increase, however the employee was expecting more and suddenly becomes disappointed. In order to keep the discussion buttoned up, professional, and positive, keep these tips in mind:

• Explain the company’s policy regarding pay raises: Don’t just offer the raise and then move on. Give it some context. For example, explain that your company offers raises based on merit, and that raises aren’t simply doled out annually. A little context can help an employee to have a clearer perspective on what’s being offered to them.
• Be very precise about what’s being offered and why: The employee should know exactly why they’re being offered the raise, regardless of whether they feel excited or disappointed with the figure that’s presented to them. The increase must be linked directly to their performance. You should be able to provide examples about why their performance justifies the raise.
• Don’t compare their raise to any other team member’s raise: Even if they’re getting a much larger increase than someone else in the office, there’s no need to drag other people’s earnings into the discussion. The conversation is between you and your employee, so anyone else’s raise is irrelevant. If the employee asks how their increase measures up to someone else’s, simply redirect the conversation.

Lastly, it’s important that you answer any questions that the individual may have about the raise. This may include giving guidance about how they can earn a more substantial pay boost next year. You’ll also want to provide plenty of written documentation before, during, and after this conversation so that both parties have it available to reference should it become necessary later on.

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