You Want More
04/29/02
By: Suzanne Koudsi, Fortune
But your company doesn’t have it. Suzanne Koudsi finds out how to get a raise when the well has run dry.
With companies postponing merit increases, slashing bonuses, and freezing salaries, getting a raise might seem downright impossible. These days the chances are that even if you muster up the courage to ask for one, the boss will tell you that the company is short on cash. Don’t despair: There are alternatives – remember, no one wants to lose his best employees.
After speaking to compensation consultants and work force experts, FORTUNE came up with ways to break free from pay stagnation.
Design your own incentives. Think in terms of what you can do for the company. “The really savvy employee will sit down and say, ‘Let’s discuss what it’s going to take to turn this place around,’” says Fred Crandall of the Center for Workforce Effectiveness, a management consulting firm. If, for example, the company is in a cost crunch, talk to your boss about how you can help it to save money. At the same time, ask how some of those savings can be transferred to your paycheck. The same goes for revenues that need a boost.
Don’t limit your conversation to a bump in base salary. Salary increases cost companies a lot of money because they’re fixed costs that increase yearly. Instead, try asking for alternatives, like stock options or a spot bonus.
Look beyond your checking account. If more money is simply not an option, be open to noncash rewards. You might ask for a compressed workweek, flextime, or extra vacation time. “When a company is in a position where it can’t offer you a raise, it may be more willing to accommodate those things,” says executive compensation consultant Paula Todd of Towers Perrin. Make sure , however, that you don’t leave your colleagues in the lurch if you do spend more time out of the office.
Don’t ignore career development. Though not as tangible a reward as cash, career-development opportunities can be priceless. Not only will they help you move ahead faster when business picks up, but they can also enhance your overall skill set, which may come in handy if your company doesn’t turn itself around. Here are some things you might want to ask for: more education opportunities, new work assignments, mentoring opportunities, exposure to more people through participation on task forces or committees, or help establishing a clear career track. One caveat: Since group training programs can cost a lot of money, try to make a case for individual education (that will help you contribute more to the company).
Think before you speak. “Be very introspective,” says human resources consultant Frank Belmonte of Hewitt Associates. For starters, make sure there isn’t a reason – like poor performance – that you didn’t get a raise this year. Once that’s cleared up, sit down and think about what you did well, what aspects of your job you can improve on, and what you can offer in the future – before you talk to your boss.
“Go in with an objective,” adds Steven Gross of Mercer Human Resource Consulting. Ask questions and figure out what your boss considers outstanding performance and what you should be doing more or less of to achieve it.
Focus on the future. Find out how long it will be before your company can afford to give out raises again. Dan Moynihan, a principal at consulting house Compensation Resources, suggests that you “position yourself so that you’re one of the most important people, so that when the money is there, you’re there and ready to take some of it.”
Tight times also present an opportunity to talk to your boss about the company’s prospects. If the outlook is rosy, ask for a commitment regarding upcoming salary increases and suggest that once business picks up, managers throw in a bonus to make up for lost raises.
Open your mind. Proposing alternatives to a raise can help take the problem out of the hands of your boss. But make sure you ask for something she can actually deliver. Compensation consultants suggest keeping in mind perks like nicer office space, a better parking spot, or the option to telecommute. Ask yourself, says Todd, “what’s around [company product, furniture, equipment] that the company could give you without laying out more bucks.” But, warns Belmonte, “it’s better to spend time on how to get back on track with merit increases than on identifying ‘sexy’ employee perks.” In other words, the excitement of getting a new parking spot can wear off pretty quickly.
Other options: Request a change in title. Although it may not make your paycheck swell now, it can put you in a position to get more money down the line. If you work at a small company, you may also be able to get your employer to pay for a bigger portion of your benefits.
Be flexible. Think of ways to shift costs, but don’t just look for unspent money to spend. “Save some jobs and reassign work,” says Crandall. For instance, if there is an employee – a temp or a contract worker – whose work can be shared among existing staffers, suggest divvying up that person’s responsibilities and then ask for the savings to go to those who are left. Again, make sure the suggestion will meet the company’s needs and not just your own.
Don’t get hotheaded. For starters, advises Gross, “don’t threaten to leave.” Approach your conversation with your future in mind. Frame your needs in the form of a question and try not to focus too much on yourself. Managers will respond much better to ideas that will benefit the company as a whole. “The less you talk about what I’m going to get and what somebody else isn’t going to get.” Says Crandall, “the better off you’re going to be.”
