Pay

by Lua Leggett

Handling pay conversations with your people

Conversations about pay can be loosely split into three categories:

  • Pro-active discussions driven by you, which are likely to be prompted by a performance or appraisal review or career progression meeting or a company-wide pay review process
  • Re-active discussions driven by your team member, which are likely to be driven by a request from your team member to discuss their career progression, pay progression or promotion prospects
  • Conflict discussions, driven by a specific event, which tend to follow a decision about pay that has been badly received, where the individual perceives unfairness or discrimination of some form. A classic example is where a bonus has been awarded to some members but not others.

Never be persuaded into discussing pay off the cuff, ‘in a corridor’ or without the proper preparation. It is essential to be prepared and informed, but at the same time to respond as rapidly to the request as possible. Sitting on a pay concern will be like plugging a pressure cooker: the sooner you handle the request the better, while at the same time ensuring you are prepared for the discussion.

Only in our dreams are we free. The rest of the time we need wages.

Terry Pratchett

Preparation

In all cases, take a methodical and prepared approach to get the best out of the discussion. Agree to set a time and an appropriate private environment aside, specifically to discuss pay.

Prepare in advance of your meeting, making sure you know all the following details:

  • The current pay status of the individual
  • How this compares with others on same pay grade/role
  • The headroom within the pay scale or band
  • Their job description and any competencies required
  • The progression criteria (it’s important that you understand this, so consult HR for guidance, if necessary).

You need to know and understand the parameters within which you can work to provide a pay increase. This may entail a discussion with your own line manager.

First meeting

In the meeting, allow your team member to state their case clearly and ask for evidence to be provided to support their case

Note

This is particularly important where there is a perception of conflict or if the meeting has been driven by the individual.

  1. Listen carefully, to the end, without interrupting, taking careful written notes.
  2. Reflect back their comments to confirm your understanding, agree that you have understood them correctly and demonstrate that you have genuinely listened to their case.
  3. Share with the individual the factual information that you have prepared in advance:
  • Detail their current position in their pay scale or band
  • Explain their current position with regards to their competency in role, or their performance against required criteria
  • Identify, clearly, any gaps between their perception of where they are and where they actually are with regards to performance or progression
  • Explain any constraints to the parameters within which you are able to move.
  1. Provide the opportunity for them to debate or defend their position.
  2. Agree that you will now take time to consider their request carefully and that you may need to discuss this, if necessary, with your own line manager or HR (this will depend on your level of authority within the organisation). Provide a timescale.
  3. Agree a date for a follow-up meeting at which you will provide feedback and your decision.

After the meeting

After this first meeting, review your notes carefully and without prejudice, and then weigh up the evidence for and against the request (see notes below). Once you have weighed up the evidence, you can make a ‘first glance’ decision about whether or not this case should/can/will be successful.

Where you feel there is a case to be supported, you will need to present this evidence to your own line manager or whoever has the authority to agree the pay increase. Present your findings in a factual, evidence-based format, together with your reasons for wishing to support the claim.

Establish the answer and prepare your case so you can give feedback to the individual, including evidence as to why the request has been agreed or declined.

Second meeting

At this meeting you give feedback and communicate the decision that has been made

If their claim has been successful, be clear as to when the pay increase will take effect and why they have been successful.

Note

If possible, you should also outline the timescale for their next review. This is important, as awarding a pay increase or promotion now could mean they may not qualify for the next general pay round increase. You don’t want any nasty surprises down the line.

If they have not been successful, be clear as to why they have been unsuccessful and what they need to do to enable them to build a better case in the future. You will need to help the individual to build a SMART action plan towards this objective.

Finally, ensure you keep a clear record of all the discussions and that you, as the line manager, follow up with the individual in providing them with the necessary support, training, development and opportunities.

Demonstrating that you have taken their request seriously will frequently head off any major conflicts building up to be faced further down the line.

Notes on weighing up the evidence

When weighing up the evidence to support a team member’s request for a pay increase, ensure that you look only at the hard facts. You are not judging the individual as a person, but rather their ability to perform the job they are doing to a point of such exception that they are ready for either additional reward or promotion to the next level.

This does not mean that we dismiss behavioural aspects: most job roles will require certain behavioural standards as well as skills and knowledge requirements. Comparing the standards that the company requires and those exhibited by the individual makes it possible to pinpoint with accuracy those areas that match or exceed requirements and those that fall short. It is from this evidence that you can build your case either to support the individual’s request to your line manager or HR or to decline the request. In the latter case, you will need evidence to provide the individual with quality feedback and a clear path to follow so they can succeed in their requests in the future (the SMART action plan).