05/21/2013    

PRACTICE MANAGEMENT TIP OF THE DAY

How to Decline a Raise Request

You won’t always be able to offer employees raises—even when you feel they deserve one as much as they feel they do. You have to tread lightly because refusing a request for pay increase can demotivate employees or send them searching for a new job. To decline a raise request without destroying an employee’s morale, follow this advice:

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  Establish a career plan. Explain that you are unable to offer the person the raise right now but that you can reconsider the raise if he or she makes significant improvements or gains new skills or knowledge.


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  Offer more responsibility. Tell employees that you can justify an increase in their wages if they prove that they can successfully increase their workload or take on more difficult assignments. Move them out of their comfort zone on a project to see what they are capable of doing.

Remember: If you offer these options and the employee succeeds, be prepared to cough up the extra money. If you are in no place to offer an increase now or in the future, simply say, “I just can’t offer you more money right now.”

Source: Adapted from “How to Say No When an Employee Asks for a Raise,” Gil Zeimer, Intuit Small Business Blog via Communication Briefings