When the Raise You Deserve Isn't Coming
There are creative ways to deal with bumping up against a salary cap or learning merit pay hikes aren't in the works.
A few years ago, Jennifer Elder felt blindsided when she learned she-and no one at her company-was going to get the company's typical merit raise. As the chief financial officer of a water bottling and distribution company, she knew her contributions had helped the firm prepare for an upcoming sale. "This was definitely not part of my plan," says Elder, who is now president of her own company, The Sustainable CFO.
There are times when companies, for a variety of reasons, don't give out raises. Maybe you've hit the salary ceiling for your position, something employers with more than 500 employees typically implement to foster pay equity and manage costs. Or perhaps the firm had a rough year. But the news can seem all the more puzzling in an overall strong economy. Indeed, despite record unemployment lows and plenty of job openings, the median percentage of merit raises for employees, at 3%, hasn't budged for the last eight years, according to Korn Ferry. What's more, when adjusted for inflation, Korn Ferry data estimates that real-wage salaries globally are expected to grow only an average of 1% in 2019, down from 1.5% last year.
"Just because the economy is doing well and just because you're an all-star doesn't mean you're going to get a raise," says Gabrielle Bill, a career coach at Korn Ferry Advance. "First and foremost, you need to understand what your reality is." Here are ways to push the compensation conversation forward-and hopefully snag a higher paycheck.
Itemize your value.
If you work for a smaller company with a flexible compensation system (read: no formal salary caps), experts say you may have some wiggle room. Many managers have some discretionary money. Your mission is to delineate exactly how much you've helped the bottom line by showing your boss records of your performance and clear examples of how you've exceeded expectations, Bill says. Elder, who'd been hired specifically to get the company in shape for the sale, presented her boss with a blow-by-blow list of what she had accomplished, including tidying up the books and establishing systems for better C-suite communication. "I told him, when you add all that up, it comes to a lot more than the 3% raise I deserve," she says. (And her boss agreed.)
Even if you know an imminent raise might not be in the cards, you can still talk to your boss and lay out your accomplishments. Then make winning that pay increase a collaborative process by asking your boss how you can work together to get you there, says Kathy Robinson, who heads TurningPoint, a career coaching firm in Boston.
Seek help from your sponsor.
If you have a champion at the company who will go out on a limb for you, seek that person's advice. There's a chance your sponsor might feel the issue isn't worth wasting political capital on. To make your case-and make the job easier for your sponsor-gather as much market data as you can about salaries. "You'll give your sponsor the ammunition to go to bat for you," says Jason Levin, a career and outplacement coach with Ready Set Launch in Washington, DC.
Ask for an alternative.
There are lots of workarounds to a raise or salary top out. Maybe you can ask for a bigger bonus-almost all managers have some discretionary money-or go for extras that don't cost the company anything but will make a big difference in your life. That could include asking for more vacation time or flexible office hours. When Stephanie, an HR manager for a financial services firm, couldn't get a raise, she countered with a different suggestion: as the mother of four children, she wanted to work from home. "I figured I'd rather not have to work 60 hours a week in the city if I didn't have to," she says. Her boss agreed to the arrangement. Another option, if you're facing a salary cap and want to stay with the company, is to focus on getting a promotion, which may come with more money and allow you to learn new skills.
Look for an outside offer.
It's a risky move, but one that can lead to a bigger paycheck: find a higher-paying gig and hope your employer proposes a counteroffer. Sometimes that works, but the problem is it often doesn't. And instead of displaying how much you like your current employer, you end up seeming like a Benedict Arnold. In fact, research shows that most employees who accept a counteroffer from their employer end up leaving after 18 months. "It doesn't position you for long-term success," says Alexander Lowry, a former JPMorgan executive, now a finance professor at Gordon College in Massachusetts.