When was your last pay rise? If it’s been a while, do you feel confident enough to request one? If you’re happy where you are, then you’re going to have to be proactive and negotiate. It’s rare anyone will volunteer to pay more for something unless they need to, and that includes your employer.
Employers are obligated to increase your pay if you’re earning the minimum wage, or are part of a collective form of enterprise bargaining (such as a union). If that doesn’t apply to you, then you’ll need to show your employer why you deserve a pay rise.
Surveys show that around half of all employees feel underappreciated in their jobs and a lack of pay can be a contributing factor to this. With the consumer price index showing our living costs are increasing at around 2.5% per annum, not having a pay rise will see you losing income in relative terms.
Most people are fearful of ‘causing trouble’ with their bosses, especially if they feel their job security is at risk, or they can be easily replaced. It’s important to remember that if you’re a valued employee, your employer will do what they can to keep you happy. Asking for a pay rise needn’t affect your relationship with your company if done in the right way.
Here are a few steps that will help you achieve your objective of a pay rise.
- Have a goal in mind. You need to know what you consider a successful outcome. What do you want to achieve? What do you consider fair? What is the minimum you’ll be happy with? Are there indirect financial benefits you’d be willing to accept? (e.g. upgrade of company car, higher super contribution, more time off etc.)
- Be objective. Unfortunately, it’s human nature to overvalue our achievements. We all think we’re more valuable than we are! Do some research and discover what pay rates are for similar positions. Ask colleagues, or those best able to assess you objectively, and honestly, what you feel is fair and reasonable.
- Pick your timing. If your company has just had a round of layoffs or your boss is negotiating a stressful client deal then now’s not the time to bring it up. Arrange a meeting when you know they can give you their undivided attention.
- Demonstrate a history of creating value. An employment situation is an exchange of value. If an employer is to increase your pay, particularly beyond the level of inflation, they will need to receive something in return. Sadly, many employees take the attitude they will only work harder if they are paid more! This rarely works in the real world. Document examples of how you have added value to your company to show your boss.
Above all don’t be afraid to ask. The worst that can happen is that they will say no, and no doesn’t mean no forever. If they don’t increase your pay ask them what they would need to receive in return to agree to your proposed increase. Everyone has their price and your employer is no exception.
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The information in this article is general in nature and does not take into consideration your personal situation or circumstances. You should consider whether the information contained in this article is suitable to your needs and where appropriate, seek professional advice from a financial adviser or other finance professional.