Conversations about pay can be tough, especially when there is disagreement or confusion around pay, or the reasons for a pay decision, or the perception of pay inequity. For these difficult discussions, it’s important that employers are equipped with the tools needed to navigate these types of conversations successfully.

So, an employee is asking for a pay rise. What now? It’s not uncommon for employers to spend time and energy avoiding situations where an employee might ask for more money. Whether subconscious or not, it often comes from a place of not knowing how to effectively address this type of request. However, these instances do occur and employers need to understand that 1) it’s ok for an employee to open up discussions around pay, and 2) knowing how to navigate these conversations is essential.

Preparation is key

When a pay discussion becomes difficult, it’s often because an employee isn’t getting the information needed, or the employer feels unable to answer the employee’s questions. Preparation is key before engaging in these conversations, and providing as many details as possible with a focus on the following areas will help steer the discussion in the right direction:

  • What is the pay range for the role and how is it determined?
  • What is the pay range for the role compared to market?
  • Is there potential for additional pay increases or promotions?
  • What is the market strategy and analysis in determining the pay range?

Having this information ready offers transparency and clarifies the decision making around employee remuneration.

The importance of active listening

The 80/20 rule of active listening says that employers should spend 80% of the time listening and only 20% of the time talking. The employee wants to feel heard and understood, and knowing what their concerns are will help to ensure this.

This means not being judgemental or rushing to defence if an employee is expressing concern or dissatisfaction with salary or pay rate. Become a stronger listener – it’s a skill worth practicing and will be beneficial for employers in all kinds of situations. Additionally, interrupting an employee’s statement or question about salary or pay rate to defend or explain the decision acts as a distraction and means the employee is only half listening to the response.

Have a follow up conversation

More often than not, a discussion around remuneration will result in questions that require further thought or consideration. It’s unlikely that employers will have all of the answers at hand, so arranging a follow up meeting to address any outstanding matters is needed.

It’s also important to call for a follow up if the discussion is getting heated. Recognise when a conversation has ceased being productive and is causing anyone to feel frustrated or psychologically unsafe. It’s ok, even preferred, to take a step back and suggest a continuation of the conversation at another time, perhaps even with HR involved.

There are many learnings for employers when it comes to difficult pay discussions. It might come as a surprise to hear that an employee is dissatisfied about salary or pay rate, how the role is benchmarked, what the pay range is, or the earning potential. Opening up a dialogue to understand the perception of employees will offer insight into what workers are thinking, and ultimately allow employers to address concerns sooner rather than later.

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