Six Pay Raise Alternatives
04/15/2009 12:00:00 AM EDT
As employers, especially today, we are lucky to be able to maintain our current staff levels and/or work with the employees that are left. Before everything went south, we were working late into the evenings, taking calls on the weekends and missing our kids’ soccer games and the dinner party that our wife/husband had planned with the new neighbors. We worked our employees’ tails off and their fingers to the bone.
Today, half of your employees have been laid off, let go, fired, right-sized or whatever the new economic recession has deemed them. Work loads are doubling, hours are getting longer and less work is getting done because morale is in the toilet. It couldn’t get any worse…but then your employee says, “I’d like to have a pay raise because I’m doing the work of three employees and I haven’t had a pay raise in two years.”
I scanned the news online recently and searched for “getting a pay raise.” The majority of articles were titled “Getting the Pay Raise You Deserve,” and so on. It’s safe to say that everyone deserves a pay raise. Especially those who are still employed. But budgets won’t allow it, bosses won’t allow it, stockholders won’t allow it, and, let’s face it, if you can’t get a pay raise, your employees certainly aren’t going to get a pay raise.
So what do you do when you can’t give a pay raise but your consultant/employee has been dedicated since the onslaught of layoffs began?
Below are six pay raise alternatives that have worked not only for me but for other business managers as.
Pay Raise Alternative 1: Typically in our roles as business managers, we have the opportunity to lunch a client every day, go to sporting events, concerts, etc. Step aside and pass those tickets along to your employees or consultants. A $150 dollar ticket to a Billy Joel concert goes a long way and provides maximum ROI. Images will be posted on their social networking pages, your company will get maximum exposure and your competitors will lose job candidates because they’ll wonder why their consulting firm/employer doesn’t “show them that kind of love.”
Pay Raise Alternative 2: In April 2008, 79 percent of Americans polled said they considered going out to dinner a “luxury.” Treating an employee to an exceptionally good lunch (including picking him or her up from the office) is a tremendous display of appreciation. And don’t discuss business! The whole point of the meal is for the employee to escape for an hour or so, enjoy a great meal and unplug.
Pay Raise Alternative 3: Give cell phone breaks. Fold your consultant/employee into your cell phone plan. My company has a massive plan with “bucket minutes.” Whether those minutes are used every month, I have no idea, but I would assume not. Over the past few years, cell phones have become a necessity. One less bill per month is an awesome feeling.
Pay Raise Alternative 4: Award your employee a new title. If your employee is a programmer, make him a “senior programmer.” If most of the department has been laid off, this employee is your lead dog anyway. If “senior” doesn’t fit, try “lead,” etc. Get creative. Be sure to order new business cards for your employee, too.
Pay Raise Alternative 5: Offer a flexible schedule or telecommuting. Not having to sit in traffic to make it to the office at 8 a.m. is appealing to an employee. Coming in later means the employee gets to sleep later, cruise in on the freeway with less traffic and probably arrive at the office a little less stressed. The option to telecommute cuts down on gas and car maintenance costs. The more money your employee can save, the better!
Pay Raise Alternative 6: Let your employee/consultant come up with his or her own “perk.” If it’s a viable option, implement it immediately.
* = required.
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those are some of the lame "suggestions" I have ever heard... You'd get your company is so much trouble....let alone loose most of the employees... |
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I agree with all but the 4th suggestion. You should never reward an employee by assigning an inflated job title. I can give you examples - multiple - where an employer awarded a good employee with an inflated title only to later face a pay discrimination claim. All good suggestions but the one. Thanks. |
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In my view awarding a new title can do 3 things: 1. frustrate the employee when they see it does not come with a pay raise. 2. cause a law suit in cases of pay disparity 3. force the company to raise an employee's pay in order to satisfy the above mentioned points. |
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Scott, I agree with Rfulton, you do have some great ideas but they should be incintives all the time to keep employee morale up. I started with a company that had great recognition programs. We were rewarded with play money for little thngs, then my supervisor would roll around her grocery cart filled with snacks twice a week and let us buy things with the play money. Not because of the economy, but because my company has a billion project going on, the stripped us of every perk, from the supervisor budget, to raises, to our yearly bonus of 20% they had given for 55 years was recently 2%. Morale is in the toilet! |
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all the ideas r nice but i can't give a lunch 2 the gas, water, or light dept.i can't tell my student loan "nice job,keep up the good wk" i am not unhappy at my job i made the choice but $8.75 over 7yrs my question is can unemployment help me if i leave this job and move to a different state 2 find wk does anyone know? |
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Jac213 has great advice - as Comp professionals, it is our job to ensure the organization complies with all legal requirements (as unpopular as that may be).
And I'll agree with ekosty, too, that these alternatives seem to be 'single person' focused, which do not address concerns of employees with families.
And so, I also agree with de3551 that it is always best to 'know your people' and do whatever it takes to tailor the reward to the person.
Thanks for the thought-provoking list! :D
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Jac213 has great advice - as Comp professionals, it is our job to ensure the organization complies with all legal requirements (as unpopular as that may be).
And I'll agree with ekosty, too, that these alternatives seem to be 'single person' focused, which do not address concerns of employees with families.
And so, I also agree with de3551 that it is always best to 'know your people' and do whatever it takes to tailor the reward to the person.
Thanks for the thought-provoking list! :D
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Just playing devil's advocate...
#1 ... tickets do not pay the bills - sounds like a bribe
#2 ...lunches are nice, but how does that help one's family?
#3...not a bad idea provided they can use it for personal use.
#4...titles are meaningless unless accompanied with a raise and most people these days realize that ...HR departments have really become creative with titles. A shallow ploy at best.
#5...not sure how this helps if the employee has a family and comes home later.
#6...might work for some |
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Number 6 is my favorite. All too often those with the ability to make changes, adjust salaries, etc. think (feel) they know what is best for the employee. When asking an employee what she/he would like, not only are you receiving a direct responses, I definitely feel that you have created a situation of value for the employee...everyone likes to be asked their idea(s). |
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I totally agree with the comment that #4 is a bad idea. Inflated titles mean inflated pay. |
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Great ideas thanks |
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I agree that these (other than handing out titles.... dangerous thing to do!) ideas are ones that largely should be in place at any time. However, in most cases - they aren't in place. So no time like the present - especially given the challenges we're facing - to start doing things right! And being creative about it! |
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Sorry, but I think your #4 is a truly bad idea that will increase company costs with no ROI and eventually lower employee morale. The new "senior" programmer will expect to be paid more than just a programmer, and shouldn't a "senior" title be in a higher salary range? When the make-believe "senior" vacates the job what do you say to the employees who now want to be promoted to fill that permanent role? There are several other reasons to not inflate titles, but suffice to say that I always advise clients NOT to do this. No gain will come from this. |
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I feel like a wet blanket, too....BUT (big BUT) I feel as if these forms of recognition should be happening regardless of pay issues. And some of them, like giving someone a worthless title (the title should match the job analysis...ALWAYS!) or cell phone plans are too creative without enough substance. I say: align the job to the vision and provide constant recognition and feedback....find out what is important to the individual and reward with that....give praise in a timely manner....show how his/her work is MEANINGFUL and vision serving. Help him/her find a better job if you--as a supervisor--just do not have the influence and creativity to pay him/her what they are worth! |
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I hate to be a wet blanket but I do have some problems with your solutions. Alternate #1 is fine if the tickets cost less than $50 or are company owned seats, otherwise the price of the tickets should be included in the employees income according to the IRS. Again, with #2 the meal can only be deducted as an expense if business is discussed. #4 Titles should be streamlined to avoid confusion and simplify the compensation process. They should not be changed in assumption that it will make the employee feel valued and may actually undermine the companies compensation process and create possible liability for pay discrepancies for similar titles. However, I do believe that options 5 and 6 do have siginificant merit. Again, these would have to be administered carefully to avoid setting precedence and opening the company up to possible liability. |
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Scott:
As a compensation consultant of too many years, I agree with most of your ideas. They are just the thing to help under-appreciated employees feel more appreciated. However, I would argue that we, as managers, shoulld be doing these things periodically with our employees whether the times are good or bad. Most of these ideas qualify as "recognition levels" that help keep employees motivated. As such, they are always handy tools for the motivational toolkit.
Bob Fulton |
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