Many of you often speculate if you are being fairly remunerated in your daily job. Your perception of your worth naturally provides you with an equivocal yes or no response to your question. Yet is your perception accurate? How are you measuring your worth?
According to Payscale’s 2016 Compensation Best Practices report, 64 per cent of employees believe they are not being paid fairly. The same study revealed that 73 per cent of employers felt their employee compensation was satisfactory. Clearly each side of the fence applied a different scale to gauging one’s worth to their organisation. Hmm, let’s explore that.
Employers generally take a cost benefit approach to analysing an employee’s worth to the organisation. On a fundamental level an employer wants to know if that employee’s salary is equal to or greater than their cost to the organisation, either now or over the longer term. If the employer feels their worker is costing more than what they are generating for the business, it is unlikely they will agree to a pay rise. If you find yourself in the situation where you believe your value is not being reasonably compensated, the onus will be on you to bring into consideration other cost benefit factors in the evaluation process.
If it’s all about metrics, make sure your argument is not only related to the bottom line, but also the company’s values. If you implemented a savvy new website for the company, don’t let this be the basis of your reasoning. Demonstrate how your work improved ticket sales by 17 per cent and increased the value of sponsorship by 12 per cent. Understanding the company’s growth and corporate responsibility objectives and linking those to your everyday duties will certainly capture the attention of your employer when talking about a salary increase. Keep in mind though, even if you are a star achiever, if you are also deemed to be toxic to co-workers, bringing down their morale and performance through unfair criticism and other demeaning behaviours, the emotional expense you have on the company may outweigh any argument you have for a pay increase.
The marketplace is a great way to also assess your value as an employee. A quick search of the online job boards or conversations within your networks will reveal what other employers are paying for a person with your skill set and experience. Be sure to look within your local area, a bigger city with higher living costs will probably pay more, thus give you an unrealistic comparison. You can also contact former employers to gauge their understanding of your worth and how they have calculated your value. Knowing how the other side thinks before you approach your employer to debate an increase to your income could prove invaluable. Or you may actually choose to ignore market communications. If your perceived self- worth tells you that your pay rate is above industry average, then why settle for an average rate? Are you an average employee?
One key way to protect yourself from being underpaid is to know your worth before entering into discussions regarding remuneration, and be willing to promote yourself at the appropriate salary level. You may realise that some organisations, particularly within the government sector, offer a salary band. In this instance, know where you fit within that band and negotiate for that rate.
There is an old saying that you aren’t paid what your worth, you’re paid what you can negotiate. The compensation you seek may extend beyond money. Are you after a company vehicle, a flexible working arrangement, a company paid university degree, or a bonus scheme that allows you to prove your worth and be justifiably rewarded for that in the heat of the moment? Money is not a key driver for most of you, so how are you seeking to be rewarded for your company contributions?
If that little voice inside your head is reverberating, telling you that your value to your employer is more than current circumstances represent, and that same little voice doesn’t know how to articulate a discussion leading to an increase in your remuneration package, will you run away and find an employer that does readily understand your value? It’s a method that a lot or you are in favour of, but one that I don’t recommend you employ. Of course if you have tried and failed to negotiate a pay rate worthy of your efforts, then by all means, seek another position elsewhere. If you haven’t given your employer the opportunity to improve your pay status, then aren’t you the one being unfair?
Negotiating for your desired pay level can be tricky, regardless of whether you just commencing a new position or have been with your employer for a few years. Nevertheless, if you don’t ever give voice to your wants and needs, you may never receive the rewards to seek. Most employers will not argue with a well-presented and considered argument, particularly if you time your approach when the company is experiencing success. If you are not victorious in your initial negotiations for a pay increase, you have started the conversation and your boss is fully aware of your desire for further personal successes. That will not go unnoticed and sooner or later, it will be your boss who is initiating a conversation about your pay rise…winning!