When is it Time to Raise Employee Salaries?
When employees quit, there is an inevitable disruption in productivity. Other employees will be pulled away from their tasks to fill in the gaps until you find a replacement; when you do hire a new employee, they will need time to learn your business. Maintaining employee morale, keeping productivity high, and reducing turnover are important to keeping your business running smoothly. A crucial part of employee retention is routinely reviewing your company’s compensation packages and awarding raises as the market demands. Competitive salaries can be key to encouraging employee loyalty, as it shows them how much you appreciate their efforts. If you are looking for the right time to increase employee salaries, here are some tips to consider.
The Company is in Good Financial Health
If your company is experiencing noticeable success, it is be a critical times to reward your employees with a raise. When your company is doing well, the employees also know it. Failure to consider this factor may cause employee morale to quickly plummet.
Employees are Asking for Raises
While a single employee asking for a raise may not be indicative of your employees’ satisfaction with their pay, you should pay attention when you get requests from multiple employees.
There is an Increase in Responsibilities
It is often incredibly important to recognize when you have employees that go above and beyond their normally required work. Additionally, if you have employees that have started to take on additional roles so regularly that you might think that they are just doing their job, it’s probably time to consider giving them more money. Responsibilities can also increase as a company matures. Just ensure that you aren’t asking people to take on more for the same amount of money.
Employees are Leaving for Similar Jobs With Higher Salaries
Occasionally employees find positions that are better suited for them with another company, and there is just nothing that you can do. While these moves are often out of your control, be mindful of why they are leaving. If employees regularly reference better pay in their exit interviews, it may be time to roll out the raises.
Salary can be a complicated issue to negotiate for employees. Hopefully, considering some of these factors can help make that decision easier for you to manage.
For more employer tips, check out Why Are Employees Quitting?