velohead66

Pay Rises – Why

a) Looking for some debate as to why people get a pay rise.

Eg if a clerk does the same job for 5 years, and does it equally well over those 5 years, and inflation is 3.5% pa, what is an appropriate pay rise, given that…
The Moderate Work Load has neither increased or decreased
The Satisfactory Performance Level has neither improved or diminished


b) Also looking for debate about Appraisals.

What should the clerks annual appraisal be designed to do.
Presumably to boost performance or efficiency ??

If so, should a pay rise be directly linked to the appraisal ?
If not, how can the appraisal work ?

corradoboy

An annual pay review in line with inflation is only fair, otherwise you are effectively cutting their pay. If the company is in good shape then it is only reasonable to reward loyal staff with consistant application to duty with a little more. I would be more appreciative towards consistant performance over those who suddenly turn on spurts of hard work whom normally do so with a clear motive, usually around wage review time. The average cost of losing a valuable worker is around 3k, taking into account advertising, interviewing, training and associated reductions in production whilst the new employee gets upto speed, so it is wise to respect the good staff you may already have without being a pushover.

Appraisals should not be directly associated to pay, and I would endeavour to separate them within the working year to diminsh that theory. They should however be a frank and open discussion about the persons roll, responsibilities, performance, conduct, attitude, potential and comfort within the organisation. If someone has the time, ability and aptitude to adopt further rolls then discuss it at the appraisal. Likewise discuss underperformance, but not in a way that is intimidatory or confrontational. Is there any training which may benefit them now, or even in the future should there be a viable promotion path. Be open to their suggestions, sometimes minor comments about simple things like the working environment can be a benefit to all. Consider non-productive training such as health & safety or first aid. They may highlight oversights which could be costly in the event of legal action following industrial accidents.

milo

a) should be 3.5% in that case. i feel it should maybe be a little more due to staff loyalty. i would also question the manager's ability as to why the clerk has not been given more responsibility or improved.

b) it should set targets and rewards for hitting the targets. in other words, yes, pay should be directly associated with appraisals. whats the point in saying "your target for this year is x, and if you hit it, you get nothing"?

milo

what makes u say that appraisals shouldnt be directly associated to pay?

corradoboy

Investors in People management training. Define training requirements, employee and employer objectives, set in place a plan for implementation of agreed changes and targets and a method of monitoring. Never use appraisal as a discussion on wages as it may destroy the professional relationship and faith in the appraisal system if the employee feels their efforts are unrewarded. If you send an employee on any training course with a formal qualification at the end, they benefit as well as you so why should you be obliged to pay for the training and then pay them more for the privelege. Work appraisal should be separate from pay negotiation, but take the results into consideration later at any pay consultation, along with all the other factors as to why/why not to grant a rise.

milo

okay that makes more sense.

i thought u were saying they should be completely isolated from each other. i once worked for a company that did this and regularly got superb appraisals and only inflationary pay rises. their argument - "here appraisals are seperate from pay rises". needless to say morale was low as hell, and myself and everyone else who were getting good appraisals left. all who remained were those who were also getting inflationary pay rises but poor appraisals. that company kinda shot themselves in the foot so to speak.

personally i think they should be MUCH more linked than you suggest (i.e. "if you reach this target this year, you get this much money"), as ultimately this is what i find motivates people.

corradoboy

Money is a significant motivation for many, but I have known many people make big career mistakes whilst only considering the bottom line. A good working environment with a relaxed but professional atmosphere and mutual respect between management and employee can be much more attractive than an extra £50/week and working in a miserable sweatshop with tyranical whip-crackers. I work in pre-print and have seen many people leave perfectly good jobs for the extra cash, only to return within a year cursing their decision. People can spend over 1/3 of their adult life at work, do you really want to be miserable for 20 years ?

Frosty The Snowman

I would say that the employee should be getting a 3.5% rise to keep up with inflation but I would also consider something else to reward loyalty/time served, we award staff with holidays, health care and pensions depending on length of service.


Mark

milo

100% agree with u, BUT they DONT have to be mutually exclusive in my opinion.

how come the sweatshop always pays more in these examples is it not possible to have a healthy environment PLUS good salary and regular increases for good results and meeting targets?

Andrew Dixon

I work for a rather large US IT company. They are actually quite proud of the fact that they don't 'do' inflationary pay rises - preferring to link pay to individual performance.

Unfortunately the budget for pay rises is so miserable that my pay has risen just 4% over the last 4 years, despite 'exceptional' performance. In my latest appraisal I was told that the average pay rise has now dropped to 1-2% every 30 months. Quite how they expect to keep hold of talented members of staff I don't know?

Trouble is, the cost of living is rising, mortgage rates are rising, etc. Can't see myself being able to afford to stay here much longer despite it being a fairly 'nice' place to work ...

A

corradoboy

It's probably relative. The sweatshop will have a high turnaround of staff and thus have to offer high salaries to keep enticing people as their reputation offsets interest. Vice versa, the decent place use the pleasant environment to attract and keep people without having to buy interest. I've worked in both, and prefer the relaxed one every time. Having said that, I currently work in a sweatshop but on an isolated shift pattern away from the hassle that my colleagues have to suffer. We have a very high turnaround but I wouldn't even attempt to change them as it would fall on deaf ears. Went there from a relaxed firm (where I received my management training) for all the wrong reasons (47% inc/less hours/less responsability/more holiday) but in full knowlege that the shift pattern would keep me well out of the way, and so far so good. I know full well that if I was put in the directors seat tomorrow that I could increase productivity and reduce the wage bill by around 30% whilst generating a relaxed and pleasant environment, but the senior directors would absolutely abhor my style and would sack me within 3 months. It's just the way they think it should be done and will never change.

Ray_li

Iv been with my new job for 7 months now and my job role has changes so much.
I was employed as a Design Eningeer but I now do 1% designing and 99% paper work and doing **** thats nothing to do with design.
My manager left and the company replaced his possition with an old style Director that sits there stiil me what to do.
Since my old manger left Im doing my job and all the work he was doing, this has made me so unhappy with the job.
I think at my pay review its tile to ask for a pay rise but never done it b4 so I would not know how to go about and do this.

Ray

velohead66

My original question was hypothetical, and was asked to see what would happen in those 'unrealistic' circumstances.

It's good to see why people get pay rises, and what they expect it to be for.


I work for a small company of 40-50 staff.
My dept (inc me) has 6 people.
Work load is moderate to high for everyone.
Dept attitude is fairly relaxed, but professional too.
Nature of work is stable, generally 'more of the same'.
Nature of work does evolve, as we try to be more efficient/targeted/proactive/organised etc

For the top 3 people (me included), there is no chance of promotion. Any professional movement up to the next rung will have to be external.
(Small company, people stay put)
The bottom 3 people only have a chance of promotion if any of the 3 above move.

My company is not know for paying big bucks.
Inflation is 2.4% for the last 12 months.
My boss will probably get 3.0%
My boss did give me 3.0%

Employee M - got my lowest raise of 3.3%, and the person was 'most upset'.
Employee K - got 3.5% per union agreement, but was totally shocked that they did not get a second raise. They assure me "the first raise was for living expenses".
Employee T and W are happy with their raise of 4.4% and 10.0% which as well as rewarding performance, was supposed to bring their wages to half decent levels.
Employee C got zero due to being new.

The 2 employees will come back to me with what they think inflation will be.
I can then justify what rate they got and why.

Inflation is 2.4% but seems higher.
My car insurance has gone up by 50% over 3 years.
Mortgage rates are increasing by 0.25% regularly.
Fuel is in the news as being the highest for a while.
House prices must have jumped by 20% over the last 2 years.

Mmmmm.