asking for a raise when I manage payroll and know what everyone else makes by Alison Green on April 21, 2015 A reader writes: I manage a team of ten at a small, rapidly growing company. When I became a manager a year ago, and the team I manage was only three people, I asked for at 15% raise and got 10%, which I was satisfied with. Since then, my responsibilities have expanded enormously, and I now run payroll for the whole company. Because of this, I know that the other manager at the company with a similarly-sized team makes 40% more than I do. My yearly salary discussion is coming up soon, and I’m unsure how this affects my conversation. I know to never actually mention someone else’s salary in my own review, but I know the potential is out there. I am proud of my performance this year, have the data to back it up, and think I deserve a large increase, yet I know it is unusual to ask for a raise of even 20%. Knowing how other managers are compensated is making me feel unusually bold. How can I approach this without dragging other people’s numbers into the discussion? You know, the typical advice on this is “never refer to what someone else is earning when making the case for why you deserve a raise.” But I’m going to tell you to ignore that. The reality is, knowing what other people are making in your company is incredibly valuable: At a minimum, it tells you the range of what your company is willing to pay for different types of positions, and it tells you how various people are valued. In some cases, it can reveal systemic discrepancies by gender or other factors that shouldn’t show up in pay but often do. Injecting more transparency into what people are paid and why they’re paid it is a good thing. That said, if those others bring different skills or experience or are juggling different responsibilities or are simply performing at a higher level and with better outcomes, any of those things would be legitimate reasons to pay them more and you less. And of course, a manager running a team of 10 skilled I.T. people is probably going to make significantly more than a manager running the team of 10 data entry people, and that makes sense. So it’s not just team size; you need to look at all the other factors too. But if those factors are similar, I don’t think there’s anything wrong with saying, “Given my understanding of the range of what the company pays for similar positions, and given my work and contributions since moving into this role, I think I should be making $X.” Also, keep in mind that you don’t want to base your actual case for a raise on what others are making. The information about other people’s salaries is just informing your thinking at a broad level about what your company’s salary structure looks like overall and what the rough range is for positions like yours. From there, your case needs to focus on why you, personally, have earned more within that structure — meaning that you should ground your thinking about what’s reasonable within what you know about salaries overall, but you’ll need to mainly talk about your work accomplishments and the value that you’ve shown to the company in the last year. You may also like:will asking for a huge raise make it more likely you'll get the lower number you really want?what are the ethics around asking an employee not to talk about her raise?can you negotiate a raise if your boss knows you won't leave if you don't get it? { 132 comments }
TotesMaGoats* April 21, 2015 at 11:11 am I work for a state institution. Because of that my salary and all others are posted online every year in a searchable database. That’s…well, I haven’t decided if it’s a good or bad thing. Probably more of a “how you use it” thing. I am able to see that I’m slightly underpaid for my role/band, but that’s not surprising. What is surprising are the other salaries based upon role/length of employment. It’s interesting to say the least. So, none of that is helpful but I do know how you feel.
Christy* April 21, 2015 at 11:23 am It’s amazing how salaries at a state institution can be so high based solely on time in. Amazing. It’s no wonder people don’t leave, even when they don’t like their jobs, because they’d never get that much on the open market.
fposte* April 21, 2015 at 11:36 am I wish :-). That might be true in civil service (I don’t know if it is or not, to be clear, but it seems likelier), but lots of state jobs aren’t civil service.
De Minimis* April 21, 2015 at 11:43 am I know for mine you really have to move up to other positions before you really start seeing a big increase in pay over time [within the same job]. Anything my grade or below has a fairly limited range of pay over the course of your career, especially since actual across the board raises [for the entire scale, not the step increases] have been meager in recent years.
Christy* April 21, 2015 at 11:52 am I am particularly thinking of university employees and staff. For me in the federal government, I’m limited to the ten steps that are publically listed, and the same with my friend in the state government who works for the department of the environment.
ZSD* April 21, 2015 at 12:09 pm I work for a state university, and we can’t get raises unless we switch jobs. Other than that, we just get occasional (!) cost-of-living increases. Some years everyone gets a 0% increase, while other years we might get up to 3%. At least in my state, there are no automatic bumps for time spent in the position, and no way to negotiate a raise based on performance.
Cass* April 21, 2015 at 12:58 pm I’m hoping to get a FT position at a state university – bummed to hear!
ZSD* April 21, 2015 at 1:09 pm The benefits are great, though! And we get lots of paid leave. I get 15 vacation days, 12 sick days, and 13 paid state and federal holidays per year. But yeah, the pay is not great. I guess the key is to negotiate hard for a good starting salary.
Beckajo* April 21, 2015 at 2:05 pm Although it’s not always possible to negotiate with a state university…my salary is set and it was made very clear from the posting through the final contract signing that it was what it was and that was it. It sucks. I keep being told by mentors that I should have negotiated anyway. Since everyone from my hiring manager and coworkers to HR made it clear that it was take it or leave it, I’m not sure what they wanted me to do!
CAsey* April 21, 2015 at 3:40 pm We must work for the same state (same campus??)! ;) It’s well known on our campus that you have to keep it moving (~3 years) if you expect to make more, and to appear eager to move up. Unless you’re a nurse – they make a killing staying in the same job at our university hospital system. (I totally went into the wrong field!) The other strategy (which has worked well for my friends and I) is to work 3-5 years, then leave for a few years outside of the school and then come back in. We have experienced dramatic increases this way. But you have to be willing to go where it’s less safe (easy layoffs, less benefits, more difficult environments, longer hours, etc).
fposte* April 21, 2015 at 2:38 pm I’m at a state university, and I don’t get any “time in” increases, nor do any of my colleagues elsewhere. Where are you thinking that this happens, and are you sure it’s not civil service?
Liz* April 21, 2015 at 3:13 pm Ditto. In fact, many of us are lucky to get *any* raise, and proration often means we don’t even get cost-of-living increases. Thanks to those databases I know most of us are paid well below market rate (at least 25% below the median rate).
CAsey* April 21, 2015 at 3:44 pm The only benefit, really, is that you get to keep your retirement years of service if you leave and come back. Other than that….there really isn’t a huge time benefit. Do you have step-up PTO at least? (eg after 5, 10,15 years you get ____ more days off, etc) Also, do you have the dreaded extended sick time leave where you can’t even use your own sick bank unless you’re out for three days or more? That completely sucks away our PTO. Stupid policy.
fposte* April 21, 2015 at 4:51 pm Sounds like I got luckier on the PTO than you–ours is pretty good from the start, and it allows some rollover. And that extended sick time thing sounds hideous and I’m very glad I don’t have it. If I’m sick I use a sick day, not a vacation day. Another advantage is that at many government institutions you have access to both a 403b and a 457b, which doubles your tax-deferred space for retirement. That’s not a universally useful benefit, I realize, but it’s a heck of a help if you’re able to take advantage of it.
PlainJane* April 21, 2015 at 4:03 pm Annual raises (for staff, not faculty) based only on seniority were standard at one university employer I had, because those raises were in the union contract. At the two non-union campuses I’ve worked on, raises are hit or miss depending on the overall budget picture and leadership’s priorities. Annual raises seem fairly typical in union environments from what I’ve observed.
fposte* April 21, 2015 at 4:52 pm Ah, that makes sense–that it’s a function of being in a union rather than being in a university.
Cassie* April 22, 2015 at 12:32 am At the state university I work at, only certain positions are based solely on time in – the ones in the clerical union are (each year, they move up one step which is like 50 cents extra per hour). Positions not part of a union (such as accountants) have an open range at which you can be appointed at, but don’t have annual increases. Unless the state is feeling generous and gives us a 1 to 3% merit/COLA increase, which we have gotten for the past couple of years. Now, if you know how to play the game right, you can either – ask for equity increases by adding up every little new task you do to your job description (and hope the bosses will approve) or job-hop. I had a coworker is at her 3rd new position after leaving our department about 7 years ago. And of course she is getting increases every time she moves!
Beancounter in Texas* April 22, 2015 at 3:39 pm This is true at my current employment, but only because the boss is Old School. Bookkie 1 has been longer but is less skilled than Bookkie 2, but any time #2 gets a raise, #1 gets a raise too simply for tenure, in spite of their jobs being very similiar. It’s a disservice, IMO.
Dynamic Beige* April 21, 2015 at 12:25 pm Every so often (I don’t pay attention to the news all the time) there is a big hue and cry over what’s called “The Sunshine List” in my province. Government employees who make over $100k/year get on this list, and then it becomes “Oh my Gawd, pigs at the corporate trough, what has our society come to when over X,000 people who work in government are getting paid this much?!” But, they started monitoring this back in the 90’s, when $100K was a lot more money. So, do I enjoy the idea that someone who works in government gets paid more than I do? No, not especially when they’ve also got a great pension plan and union protection. But, if someone has been working in government for 40 years, if they are a minister or have a high ranking job, they are probably at a place in their life where they have worked up to it. If I found out they were hiring janitors at that salary, I’d be in the line for that job (toilet plunging and all). But odds are I’m never going to be chief of police or minister for social services. Given how much everything else costs now, including buying a house in this area, it seems odd to me that the $100K isn’t also being raised or lowered with inflation/being judged in 1996 dollar values. I think it would be less newsworthy if it turned out that $100K in 96 dollars was $150K (or more) today and several thousand less now made that cutoff.
ThursdaysGeek* April 21, 2015 at 2:55 pm Or a football coach at a Washington university? Two of them get over 2 million. :)
Book Person* April 21, 2015 at 3:48 pm Heck, A Certain University President on the sunshine list made well over a million last year. He received double his salary for not taking a sabbatical; meanwhile, faculty was cut and class sizes were increased because of “lack of funding.” Said extra salary would have funded something like forty more adjunct professor positions for the year. Sports and admin; the true way to enrich (or be enriched by) the university.
ThursdaysGeek* April 21, 2015 at 5:11 pm The top 10 public incomes in our state are university coaches, presidents, and administrators. I don’t know where the Governor is, but it’s way down there.
LD* April 21, 2015 at 6:41 pm There was a recent info-graphic I recall that showed the highest paid public employees in every state. Almost every single one was a public university football coach. One might have been the head of a medical school. That was an eye-opener.
Joey* April 21, 2015 at 11:15 am Do more than that. Be prepared to discuss how your background/performance compares and adjust your expectations accordingly. Because you’re going to look a bit ignorant if for example the other manager comes with much better or more valuable experience/education/skills than you have. For example, if the other manager is over sales that disparity is likely the result of that field commanding more money.
MK* April 21, 2015 at 12:01 pm I was going to say something like this. The OP really needs to think through the comparison they are about to make or risk coming across as clueless, if they are comparing themselves to people/jobs that are compeltely different. A manager with a team of 10 may be the lawyer with 25 years of experience who manages the company’s legal team or the senior administrative assistant to manages the other admins.
Ask a Manager* Post authorApril 21, 2015 at 12:06 pm How is everyone missing the part of my answer where I say exactly that?
MK* April 21, 2015 at 12:15 pm Sorry. You do mention it, but for it is the most important point. My first reaction when I read about the 40% salary gap was the conclusion that the OP isn’t thinking this through; if you are comparing yourself to a group that makes close to twice what you do, you probably don’t belong in that group. Unless there is something else going on.
blu* April 21, 2015 at 12:54 pm That’s not necessarily true. I have most often seen this kind of disparity occur when you have one person promoted into a role vs. the other person being hired in from outside the company. A lot of companies have a cap when being promoted (like 10% increase). I was in this situation at my last job. In order to get my up to an appropriate level, my boss had to first give me a 15% merit increase ahead of my promotion during annual review time, and then I got an additional 10% when he actually put the promotion through a couple months later. If he had hired someone from outside, he could have just hired that person at the correct rate from the beginning, but because I was internal he had to finagle the system.
Joey* April 21, 2015 at 12:59 pm That assumes the positions are similar. If the ops doing all of payroll that’s unlikely
blu* April 21, 2015 at 1:02 pm Yeah, I was specifically responding to the idea that if the pay disparity is that wide then you probably don’t belong in that group. I’m in experience, that isn’t necessarily the case.
MK* April 21, 2015 at 2:10 pm This rule seems nonsensical to me. In practice, it applies in my job, in the sense that you have to climb the hierarchy ladder step-by-step, you cannot be promoted three levels above, so your pay increases necessarily follow a gradual path. But if you do promote someone to a much higher position, it makes sense that they should have the corresponding salary.
blu* April 21, 2015 at 2:48 pm Oh I agree, though I guess the idea is is to encourage managers to give gradual increases/promotions all along rather than needing to make a huge leap, but the combination of my job changing so much and being stuck with only a limited number of titles to choose from made it hard to do that. I went from Staffing Specialist to Project Manager which ultimately made about a 20K difference in my pay. That’s not a typical career path so I can see why it would be difficult to find some kind of title in the middle to promote me to.
Retail Lifer* April 21, 2015 at 3:56 pm Same in my field, only with no way to get that extra percent. You’re capped at a certain percent incresase for a promotion, then a small potential increase annually. It could take years to just break even with someone who was hired externally. This is why I switch jobs every 2-3 years. If it were competitive to stay, I would. But it never is.
Kay* April 22, 2015 at 8:40 am I wish the case were that I was not thinking it through! Naturally, the other manager and I are not the same person, and we bring to the table slightly different experience and education. More importantly, our teams are, as many of you mentioned, comprised of people with differing roles and skill levels. However, we are roughly the same age, were recruited from the same institution, and have been with the company for about the same amount of time- I came on about 9 months after he did. I am unsurprised that there is a gap in our salaries based on these factors, but 40% seems completely disproportionate. It might be related to an initial large leap for the other person, or how the CEO views the value of our teams. As I said, I would absolutely expect there to be a disparity, just not one so large. I actually submitted this question a couple of months ago and had the salary conversation since. I kept the other person’s numbers out of it, and received a moderate raise I was generally happy with. Two months later, my compatriot was bumped another 30%. Looks like I’ll be having this conversation again next year!
ThursdaysGeek* April 21, 2015 at 3:02 pm In my case (in long-ago-job) there was a pretty big discrepancy, and it was for two of us doing the same job, working next to each other, and who had been earning nearly the same amount. (And we both supported payroll, and were open about what we were paid.) There was something else going on: he was male, I was female, and our new boss only wanted him, so he boosted him to a new pay scale and gave him a hefty bump, and tried avoiding talking to me. After that, I’ve always thought that knowing what others (in my same role) are being paid can be a good thing. When we first started, he was paid slightly more, but he’d been at that job and I was new. That was ok. But I want a way to know when I’m being paid less for being female.
Joey* April 21, 2015 at 12:46 pm Oh you said it, but i think it deserves more emphasis because the circumstances are likely very different if the op is doing payroll for the whole company. There can’t be anyone else doing it too.
fposte* April 21, 2015 at 11:17 am This is how I negotiated my first salary. I’d been a temp and had worked briefly for the personnel director, so I knew the salaries. The job they offered me was the receptionist position with an additional responsibility load, and I said I’d need more than the old receptionist salary for a position that was receptionist plus a new layer of responsibilities.
Chinook* April 21, 2015 at 11:22 am AAM is exactly how I negotiated my salary when I went from temp to perm in a place where I got to create the annual letter describing salary and benefit costs for each and every employee (so I literally knew what everyone made). This place also had pay scales for each type of position with steps, so I just stated that they knew I knew how it worked but that, considering my experience and education, I did not expect to be at the bottom step for that particular position but more at the middle or top. It worked and there was no awkwardness.
Nameless for Post* April 21, 2015 at 11:25 am Regular reader posting anon for this post. In 100% agreement with everything AAM posted. You are in a unique position to know how your company’s salary scale is for various positions. Now for a selfish post about my situation. Through an error of my boss I saw what people in similar positions are making. I have more duties, more complex work and years more experience than the two that are paid more than me. They have 2 years experience and I have 8 years plus am the go to person for complex issues. I made a case based upon my duties and was told he would “think about it”. That was several months ago and now I’m job hunting because of it. The indiscretion was printing a salary sheet with listings for bonuses to a common printer. It was at the bottom of papers I’d printed and was confused at first glance/what was it to give it to that person. Upset was an understatement. I may have literally saw red as my blood pressure rose. I’d been granted more duties and given minimal raises because “money was tight” which I understood because it seemed like it was.
AMG* April 21, 2015 at 11:40 am I can see why you went anon, and I can see why you’re upset. I’d be looking too. Just curious–what would happen if you put your 2 week notice in and they bump up your pay? Would you stay then, since it’s a monetary issue?
Nameless for Post* April 21, 2015 at 1:33 pm I’d still leave. I’m wary of accepting any counteroffers and would ponder if the next time I wanted a raise if I would have to give my notice before they’d offer a raise. And would wonder why they “found” the money but couldn’t previously.
Apollo Warbucks* April 21, 2015 at 2:26 pm I’d refuse a counter offer on principle, employee retention starts before people are so pissed off they are about to leave.
the gold digger* April 21, 2015 at 12:00 pm I was furious when I figured out that my boss was willing to pay a headhunter $30K to recruit someone, even though we had an HR department that did recruiting, but fought over giving me a $1,000 signing bonus to cover my COBRA for a month when I wouldn’t be on the new plan until after the waiting period. I was even more furious when I discovered the guy they hired to replace me – who has been given less than half the responsibilities I had (I opened and managed the Mideast office, I did all the financial reporting and strategic planning and he is doing none of that) and has yet to accomplish anything (I licensed our product to international companies – I sold a bunch of new licenses in 18 months and in a year, he has not sold one), was being paid $67K to my $50K. When I gave my notice, my boss said he could maybe find more money. I wanted to say, “Why couldn’t you find it before?”
Nameless for Post* April 21, 2015 at 1:30 pm Exactly. He suddenly found the money but couldn’t find it before to close the salary gap or offer something else due to excellent performance.
Anon this time* April 21, 2015 at 2:01 pm LOL, but in sympathy. I was in a similar situation. I left Job A for Job B in a related field and for more money. A year and a half later, old boss tried to woo me back for a lousy 5K extra. I said I needed 20K, because I had stumbled onto a list of bonuses and found that the boss’s pet had received a raise of that amount the year before I left. Old boss spluttered and paused and said “we would never be able to do a raise of that size” and I said too bad, no longer interested. They are on the third person in that job in 3 years now. Heh.
the gold digger* April 21, 2015 at 2:03 pm Oh! By “pet,” you mean his favorite employee. I first read this as, “He somehow gave the money to his dog,” and I was thinking, “That would have me in a red rage!” Of course, that he gave a bonus to a human is also maddening.
Anon this time* April 21, 2015 at 3:00 pm LOL! Yes, the favorite employee who did no visible work. Her desk was always, always clean. I don’t tend towards clutter, myself, but she absolutely never seemed to have anything that she was working on out.
Karowen* April 21, 2015 at 12:35 pm I was in a similar position where the other woman was making about 10% more than I was, even though my job was hers +extra stuff. I had no clue how to negotiate a raise (this was years ago, before I knew of AAM) so when I went in to my boss I basically just said I should be making as much as the other woman, and was told I couldn’t because the co-worker had experience. Her “experience” was working as a cashier, not in an office setting where I had to hold her hand. Meanwhile I had been in the position for 2 years. It was heartbreaking, honestly, and really put into perspective how little my boss valued me.
HRChick* April 21, 2015 at 1:21 pm This type of thing happened to me – I used to work for a big name government contractor. Lots of our people worked directly for the government. One of the government people asked us to promote his contractor admin because he “liked her”. Instead of saying, “We can’t promote her, but we can give her a raise”, my boss had me rewrite her resume (VERY weak – think basic admin) to promote her to my job position (project manager) + 1 level above. My boss was very mad because I refused to make some of the changes he needed to promote her (like changing all her job titles to project manager instead of administrative assistant) because I felt it was unethical. When I pointed out that I met the qualifications for that position (and therefor deserved a promotion) and she didn’t, I was told they would “review” my claim. And then I was told to drop it. I started job hunting and got new job shortly after and they lost a valuable employee (if I do say so myself). They offered to match my new salary, but I’d lost respect for how they ran their business.
Nameless for Post* April 21, 2015 at 1:28 pm Sounds like it was good that you left that job. That was very unethical and dishonest how they wanted to change her job title and other things to have her promoted when she wasn’t qualified.
HRChick* April 21, 2015 at 1:54 pm Yeah, I was happy to leave after that. It’s the difference between knowing you’re underpaid and knowing you are underappreciated.
Anon this time* April 21, 2015 at 3:39 pm Pretty much in the same situation here. Discovered that I am paid at a lower rate than some people significantly less experienced than me, and whom I had been promoted over years ago. I literally lead their team. I was furious. My managers claim to value what I do, give me lots of praise and accolades, but the money says otherwise. As soon as I find that new job, I will only give two weeks notice. I would not accept a counter offer – I do not want to work for people who think so little of me. I think they thought I was too naive to notice/realize how underpaid I am. I have long felt that my (older, male) managers see me as a inexperienced young girl, instead of 15+ years experienced, middle aged, woman, and this confirmed it.
Nameless for Post* April 21, 2015 at 3:47 pm Absolutely. I hope you move on to a better job that pays better. They are taking advantage of you in a terrible way.
Retail Lifer* April 21, 2015 at 4:13 pm Been there. Only knew because the first time I caught a glannce of a newly hired, less experienced manager’s new hire paperwork. The second time it was after a guy left the company and he told a mutual friend how much he made. The first time I chalk it up to a negotiating fail on my part (but there weren’t all these salary sites back then so it was harder to do reserach) but the second time was clearly sexism. After asking around more I found out that women were regularly paid less in management at this organization, despite many of us having more experience.
Snarkus Aurelius* April 21, 2015 at 11:27 am AAM gives good advice, but keep in mind, they can still tell you to go pound sand. Yes, your company knows that you know what others make. They still might not care that you know this. When I worked for a government entity, all our salaries were public. I asked for a $5K raise after two years of not getting any. I made sure to emphasize my accomplishments and value to the office. The excuses were: budget cuts, sequestration, cutbacks ordered from on high, etc. “We literally don’t have the money.” I found out later that a man at my level, who supervised more people but worked fewer hours, got a $10K raise in that period. (Bonus: he didn’t even ask for it.) My bosses, I hope, knew I could read, do kindergarten-level math, and search online. They would have to know that I would find out about this. My hunch is that they didn’t -care- because they viewed me as replaceable but not the guy who worked from 11 AM to 3 PM yet was paid on a 40 hour salary basis. (His family had connections to the boss that made him untouchable.) So…take AAM’s advice. Just don’t expect miracles. And yes I left. They might have “won” on the raise front, but I tell that story to everyone I know and will continue to do so for the rest of my life.
sad preacher nailed upon the coloured door of time* April 21, 2015 at 8:10 pm Sadly: this. I know that I don’t have as much experience working for many different companies, but: I find it is really, really difficult to believe that an employer is going to bridge a 40% salary gap with a single raise. Maybe if you’ve done something miraculous, like provably brought in millions of dollars of profit. Or obtained pictures of your management chain engaged in sex frolics with various non-human species. I’m sorry to be glum – and I would love for the OP to follow-up and tell me that I’m wrong! – but all I can think is that they simply are not going to listen to your argument, no matter how compelling it is. they probably have a figure in mind for you – 7%, say – and you might argue them up to maybe 10%, but 30%? 35%? 40%? Even if your manager buys your argument, he’s going to have to push back up through couple levels of hierarchy just to get the extra funding. Again, I hope I’m wrong. But I know that for me, personally, if I ever was in this position, and my management was simply ignoring anything I told them, it would be very difficult to avoid dropping the “bomb”, ie “so how come Bob Smith and I do the same job, but he gets paid almost twice what I do?” The risk is finding yourself standing at point IDGAF and angered to the point where you just want to rub it in their faces and you don’t care about the consequences. If you find yourself headed in that direction, you might want to disengage and “live to fight another day”. Good luck with this.
The_artist_formerly_known_as_Anon-2* April 21, 2015 at 11:30 am This can be touchy – and BOY, does it make management nervous — when payroll info is known. Most companies handle this by “farming out” the payroll application. Again – make YOUR case known, based on your qualifications and contributions — and loyalty counts for something, too. Don’t use your pay level knowledge unless it comes down to a major management stonewalling , or you get into a bad faith negotiation. Even then – use generalities, not specifics.
Partly Cloudy* April 21, 2015 at 11:39 am This. Use the knowledge to build your case, but don’t let the knowledge BE the entire case, if that makes sense. As Spiderman would say, with great power comes great responsibility. Having access to confidential information means that the higher-ups trust you. Don’t screw that up by turning salary negotiations into comparisons to others; you should be able to argue for why you deserve to make X based on YOUR work and accomplishments.
Spelled like it Sounds* April 21, 2015 at 11:49 am What about the fact that the OP has only been managing this group for a year and got a 10% raise at the time she became a manager? Would asking for a 20% raise only a year later seem out of line (even though she is aware of how much others are paid)?
Ask a Manager* Post authorApril 21, 2015 at 11:53 am It really depends on her performance and on the salary range for people in positions that are truly similar. If those salaries she saw are for people with a similar level of responsibility and performance and skills and outcomes, and she has excelled this past year, it could be perfectly reasonable. But if any of those factors are missing, then it’s probably not reasonable.
MK* April 21, 2015 at 12:08 pm Frankly, I would be surprised to hear that’s not the case. The other managers are making almost twice what the OP makes; that’s too big a difference. Either there is pretty overt discrimination for some reason or the respective positions are nothing alike. I do wonder if the OP is classifying anyone who is head of a team as “other managers”.
Jamie* April 21, 2015 at 1:43 pm It could be the initial negotiation as well. Hypothetical but happens: Company needs to hire position A quickly. They find a great candidate that can not fill position A now, but their background, skills, and career goals line up with position B which they will need to replace in a year or two (higher level position and upcoming retirement – so no way to restructure to make it open now even if candidate was fully qualified now.) This candidate is making a lot more at their current gig than they were offering for position A and of course they aren’t going to jump for less money. Company decides to take the risk and pay them slightly over what they are currently making to get them with the intention of candidate growing into position B in the next several years. This is with the understanding that the candidate shouldn’t even think about a raise as they are coming in compensated way above others in similar positions. If the company is already at or near market on salaries they can’t bump everyone else so they are also overpaid just to be fair. But of course people would be pissed off to know that someone in relatively the same position is making tens of thousands more. The company is gambling on this person staying until they can assume the other position and developing the skills to be qualified for the other position when the time comes because the upside would be having someone internal (at that point) assume the higher level position – that’s a high risk/high reward kind of deal, but so is bringing in top level management from the outside. If the person leaves or isn’t as good as was thought upon hire the company is out the part of their inflated salary above market for the time there. If it becomes known and others get disgruntled and leave they assume the costs of turnover. A privately owned company has the right to take those kind of calculated risks – you can treat an employee differently even in salary as long as it’s not motivated by any protected class issues. I know this sounds specific, but there are a lot of scenarios (this is just one) in which there could be good reasons for the initial negotiation to come in higher than the company would have preferred. And that initial pay rate sets the baseline – if you come in really low either because of the timing of the market or not negotiating, or whatever it’s a lot harder to get the significant jumps to even out. I wish someone had told me when I was starting out how critical that baseline is to future earnings – it’s no fun playing catch up.
MK* April 21, 2015 at 2:04 pm Oh, I can think of a lot of scenarios about why one person is paid a lot more than the rest of their same-level coworkers. But I think it would be bizarre for a company to single one person and pay them almost half what they are offering everyone else.
Jamie* April 21, 2015 at 2:13 pm I agree if the one off was one person being well below and that wasn’t based on a legitimate reason it would raise eyebrows. The way I read the letter was that the OP’s salary is 40% less of the other manager in a similar position – so I was just thinking it’s possible the other manager is the outlier since a sample of 2 doesn’t really tell us anything without more details.
MK* April 21, 2015 at 2:33 pm You are write, I misread the letter as saying “all the other managers”. The OP seems to be comparing themselves to one other person, not a group; there could be lots of reasons for the difference.
Jerry Vandesic* April 21, 2015 at 11:51 am “Because of this, I know that the other manager at the company with a similarly-sized team makes 40% more than I do.” This is a good place to start, but is by no means enough to determine if you deserve more relative to your colleague. Do your two teams do the same kind of work? At the same level? With the same revenue? If there are factors that differentiate your two teams, you need to think about how those factors are valued by the company.
E* April 21, 2015 at 12:02 pm Another thought is that if management says no to a raise, ask them what you’d have to do or show improvement on to get to that level of pay. Get this in writing, make a plan, and go for it!
Snarkus Aurelius* April 21, 2015 at 12:34 pm Make sure it’s as numerical as possible. That way they can’t argue on abstract concepts. And if they don’t want to put it in writing or they don’t want to use numbers as a measure of performance, then those are red flags. Big ones.
Ann Furthermore* April 21, 2015 at 12:26 pm Excellent advice. If your management has any sense at all, they’re going to know that you’re basing your requested increase at least partly on what another person in a position similar to yours is making. You work in payroll, you’re allowed to see that information. You can’t not see it. But you can’t come right out and say, “Jane makes X and has a team about the size of mine, and therefore I should too.”
Jamie* April 21, 2015 at 1:20 pm Yes – if you know what other people make legitimately through your position (as opposed to someone telling you or seeing a list on someone’s desk) they know you know. And you know they know you know. The elephant is in the room and everyone can see it. It’s just a matter of observing the protocol and avoid being too blunt in your phrasing. But it would be idiotic to expect that someone who knows this information wouldn’t use it to evaluate their own compensation.
Hlyssande* April 21, 2015 at 12:40 pm You might also want to do some research to see what the market rate for a position like yours appears to be. That could also provide a strong base for you to negotiate with if it looks like you’re being paid below market rate.
KimmieSue* April 21, 2015 at 1:12 pm This! Salary.com & Glassdoor.com are great resources for researching salaries by position, duties & location. Do the market research and be prepared.
Lanya* April 21, 2015 at 12:47 pm My friend was the only female manager in a group of about 20 regional managers for a national construction supply company. One day, she accidentally saw a list of all of the managers’ salaries…and hers was the lowest, despite the fact that she had been working for the company much longer than several of the other managers. The next week, she asked for a raise. When they wouldn’t give her one, she left and never looked back.
Laurel Gray* April 21, 2015 at 1:08 pm She would have had a great case for the EEOC who would have went to bat for her. With evidence like a physical list (even if she didn’t have it, in their investigation they can request salaries) her company would have had to explain themselves. My guess is that they would have tried to reach a settlement with her. Just browse the press release section of their website – it is quite fascinating at how major corps discriminate and end up paying out big bucks when “caught”.
Lanya* April 21, 2015 at 3:54 pm Thank you for sharing! I wish we had known about this at the time. I wonder if it would have made a difference in her staying with the company or not. She felt very betrayed that she wasn’t given the same treatment as the “old boys’ club”.
Jamie* April 21, 2015 at 12:59 pm And of course, a manager running a team of 10 skilled I.T. people is probably going to make significantly more than a manager running the team of 10 data entry people The salary for managing IT people should really be nominal. It’s a proven fact that we’re the easiest people to manage, on any payroll. No issues with stress, no one complaining about hours, no high dollar requests for equipment every other day, software never changes so managers never have to worry about staff updating skills, and none of us think particularly highly of ourselves or our abilities so ego never comes into play. All kidding it’s pretty easy to manage IT: 1. Understand real reward is in the form of money. If raises/bonuses are absent all the cupcakes in the world mean nothing. (although they are a nice add-on in addition to the cash.) 2. Protect team from nightmarish work-social events 3. Make sure recognition is valid, sincere, and isn’t the form of a trophy from the dollar store. 4. Fight to get them the budget necessary to do their jobs. 5. Have their back and defend them when needed. Against irrational complaints, against people trying to usurp their off hours for personal or non-emergency issues, against policy violators who don’t understand network security is there for a reason, and most importantly against the inevitable queries of management of other departments wondering why they make so much money when no one knows what they do. 6. Hire competently. 7. Ensure no one is required to work with less than 3 monitors and a chair with good lumbar support. 8. Don’t forget to call for delivery when they are working round the clock because something pooped the bed. 9. Access to free caffeinated beverages isn’t a perk – it’s a civil right. 10. When end users are particularly difficult and the lack of thanks is affecting morale email team a sardonic IT cartoon/joke with the general message of IT rules and everyone else drools – there are millions to choose from. It’s not so much herding cats as just giving cats the tools and support they need to do their kitty thing unencumbered.
A Non* April 21, 2015 at 1:49 pm “It’s not so much herding cats as just giving cats the tools and support they need to do their kitty thing unencumbered.” QFT. The best IT bosses I know are the ones who set a few high-level goals in terms of “this is what the company needs, go figure out how to build it”, then let the techs do tech things while they deal with all the business things. I used to think it was silly to have a not-as-technical person overseeing tech workers, but as long as everyone can respect each other’s roles it actually has a lot of merits.
Jamie* April 21, 2015 at 2:00 pm Non technical managers can be good. Technical managers can be good. It’s the non-technical managers who think they are technical managers which strike fear into the hearts of all IT. Those are the people who will promise others everything on ridiculous timelines and no budget and then think less of their team because they didn’t come with magic wands. Although time and money pale in comparison to the manager who promises something not even remotely possible and assign it to the team without zero awareness of how much of their ignorance is showing. I’ve seen managers like that in the wild…it’s best to stay silent, cover your scent, and back slowly away before they make contact.
A Non* April 21, 2015 at 2:31 pm Oh gods yes. My least favorite right now is the boss that will tell you to fix everything, then not actually let you change anything. Because his way is right and/or any success on your part would threaten him. Just got rid of one of those. I migrated a pair of business-critical servers off ten year old hardware within two months of his departure.
Connie-Lynne* April 22, 2015 at 9:11 am Heh, I remember being at a conference session about technical project management and seeing one of the least-knowledgeable PjMs at my company raise his hand when the presenter asked “how many people in this room are TPMs.” My eyes rolled so hard that they sent a text message to the other manager on our team.
Apollo Warbucks* April 21, 2015 at 1:00 pm Good luck op, I tried an failed to even out a $15k salary discrepancy between myself and a coworker who did very similar jobs. 12 months after telling my boss I was fed up of being unperpaid the gap hadn’t closed, because of a blanket ban on pay rises for the year I went on two interviews and got an offer for 30% more pay. The counter offer my boss came back with was laughable (barely 10%) I’ll echo Alison’s advice about paying attention to the different skill sets of the managers you’re comapring yourself to as different specialisms command different salaries, and I’ll also suggest reading the article linked below as it frames the issue of why coworkers might be paid more than you. It really help me shift my thinking about my situation.
Apollo Warbucks* April 21, 2015 at 1:02 pm https://www.askamanager.org/2014/05/my-coworker-makes-more-money-than-me-but-we-do-the-same-work.html
Joey* April 21, 2015 at 1:03 pm One suggestion Id also make is to get an outsiders perspective on the specifics Most humans tend to think their performance/qualifications/responsibilities are above average
Kelly L.* April 21, 2015 at 1:53 pm I think you’re really trying hard to insist that the OP is in the wrong, without much evidence.
Joey* April 21, 2015 at 2:01 pm Nope. Just trying to say someone with no interest in the outcome is likelier to make a more objective analysis
LBK* April 21, 2015 at 2:55 pm Not really, I think it’s always good to get a second opinion. Few people think they’re bad employees. Even if you actually are a good employee, it can’t hurt to confirm that with an outsider or make sure there aren’t gaps in your abilities that you can’t see from the inside.
Kelly L.* April 21, 2015 at 3:00 pm My comment had more to do with the sum of this comment with the commenter’s earlier one, rather than this one in isolation. He seems to be belaboring the point a bit.
Ultraviolet* April 21, 2015 at 3:30 pm Especially given how bad this conversation will be if the OP has misjudged their own qualifications and market worth relative to those of the manager they’re comparing themselves with. I think that’s why several people are really emphasizing how important it is that the OP be cautious and sure of their case.
August* April 21, 2015 at 1:17 pm Few years back, one of my peers became my manager. We joined the team together, graduated college together and were more like friends. But I was totally okay with him being my manager as I chose to be in technical career growth path. All of a sudden he was privileged to look at my salary and I don’t think he was happy. He started being hostile to me , undermining me in everything, stopped inviting me to the meetings where every other team member was invited. I had to leave the team. In our last meeting he said “by the way…you make way more than me”. I felt so violated because the person who had the exact same qualification as me was privileged to know my salary and I till date have no idea what he makes.
MK* April 21, 2015 at 2:00 pm I am not sure what your point is. Among other people, a low-level clerk is “privileged” to know my salary, because they are the one who prints and distributes the monthly salary confirmations. It would hardly be practical if only people senior to you had access to the information; people senior to you probably have too uch on their plate to handle payroll as well. In your case, this person was your manager; there is nothing more natural than that he would know this. It seems to me that neither of you handled the “peers who become supervisor and subordinate” situation very maturely. He took his frustration on your salary disparity out on you, instead of addressing this with the company, while you think he was less of your boss because you started out together.
August* April 21, 2015 at 2:11 pm As you agree, he could have taken his frustration over the salary disparity to the company because he became my manager and he gained the privilege to see my salary information. However, say if he made more than me, then I would have had no such privilege to have a look at his salary and go to the company about the salary disparity. It was a one way privilege which he could take advantage of.
MK* April 21, 2015 at 2:39 pm My point was, that you seem to regard yourself and this peer-turned-manager as equals, because you started out together, so you think you should both have access to the same information. But that’s not the case; since he was promoted, he was your boss and as such had authority over you, which included knowing your salary.
Apollo Warbucks* April 21, 2015 at 2:42 pm You say it’s a one way privilage, but it’s not like your manager was handed the salary information for no reason, they must have needed it for their job, there is absolutely nothing wrong or sinister about your manager knowing your salary. The fact that he was a jerk isn’t realted to him knowing the information.
Jamie* April 21, 2015 at 3:53 pm He could have taken his frustration of making less than you to management. And he would have been quickly educated to the fact that many managers make less than their technical reports. The reaction would not have been surprise followed by a raise for him because he pointed it out – they know. And there would be no practical value to you knowing his salary since you are in two different positions – apples and oranges. The only “advantage” to him knowing your salary is that it bothers him – nothing else. Him commenting the way he did to you is a common type of mistake when someone is growing into a management role and hasn’t yet mastered the different dynamic required – that snarky comments may be eye rolling from a peer are really inappropriate from a manager. This makes me grateful I’ve never been on new managers team – I cringe at some of the mistakes I made.
August* April 21, 2015 at 2:24 pm Also, I learnt a lesson. I will probably never work again for some one who is more like my peer because instead of managing me, help me grow and talk to the upper management for my salary increases, they may just end up competing with me and sabotaging me like what happened before. I have had two managers since then and both are way senior to me. So they are more resourceful and help me grow than competing with me.
LBK* April 21, 2015 at 2:58 pm I have to say I’m kind of confused. Isn’t your manager always senior to you by definition? Or are you using senior to mean they’ve been there longer, as in seniority? Either way it seems odd that a manager would need to compete with their employee – sounds like they already won if they got a promotion.
Apollo Warbucks* April 21, 2015 at 3:11 pm I took it to mean the manager was a former coworker was promoted but on a lower salary which he resented and handled badly
Jamie* April 21, 2015 at 3:45 pm No one is going to get the same level of mentoring and career development from someone who is brand new to management. New managers are still learning the management ropes and if they aren’t better after the become more senior then that’s a sad commentary on them. That’s why in a well run company people someone will be working with new managers especially on things like awarding raises, bonuses, promotions, etc. Because the damage to the company of screwing those up is significant so only lunatics would be first timers the raise bucket with no oversight. And I am with you on fighting for pay increases. There is no doubt in my mind that someone senior who is making a lot more than you is going to go be much more willing to go to the mat with upper management if they feel you deserve more money than someone who is making less than you and hasn’t honed his wresting with upper management skills yet. That’s why few newborn managers are sole decision makers on those things. That said there are plenty of senior managers who won’t fight for more money for anyone because they like it under the radar – but at least you have a better shot.
August* April 21, 2015 at 4:03 pm To answer the question about being promoted to manager, it is not like some one got “promoted” to become a manager. Our manager at that time was going on a long term relocation. It is more like he wanted to take managerial path, there was no one else who was willing to be the manager. So senior management decided to make him the manager. There was no “promotion” as such. I work for a tech company where engineers are highly valued and decide to remain as individual contributors and take up technical career path and go on to become architects, senior engineers etc but they report to a manager. So a manager can very well make less or equal to an engineer because he/she may end up managing. But if the manager is seasoned enough, he/she would not get all worked up because her direct report is making more than her. Also, this “I am the boss” doesn’t work in many of our teams. All the good managers I had never at least made it apparent that they were the boss.
Lamb* April 21, 2015 at 10:08 pm You say “there was no “promotion” as such”, but there was; the management position opened and your coworker was promoted to it. That is a promotion. I’m really not sure what distinction you were trying to make?
August* April 21, 2015 at 10:45 pm The distinction is becoming a manager is not necessarily a promotion. Say for example, person A is a Level1 employee. He can be a manager or an engineer. The only way he can be promoted is to become a Level2 employee. This is the only way you get benefits of a promotion in terms of pay, stocks etc. If he is a Level1 engineer and becomes a manager but is still at Level1 (which was the case when my peer became my manager), it is not a promotion. It is just a change in job role.
Super Anon Today!* April 21, 2015 at 1:25 pm Can I assume that this advice holds true when I know/can easily see what the hiring salary range is for open positions at my company? When we post an open position for my exact role, I can see what the range is for the salary for that position, and let’s just say it’s significantly higher than what I was offered and currently make. I’ve been hoping to build the case for a raise later this year and, in addition to my personal accomplishments, was wondering if there’s any way to also indicate that I’m paid below what new folks just coming on board are being offered.
Apollo Warbucks* April 21, 2015 at 1:33 pm Yes you can, if your comapny is advertising the pay scale and you don’t fit into it then you should ask about what needs to happen to get you moved into the range.
Zahra* April 21, 2015 at 2:34 pm You could make an argument for market adjustment. As in: “The market has changed since you hired me and my current salary is below what a new employee would make in our company. I have made X, Y, Z accomplishments. Is there any way to increase my salary to be more in line with the amount someone with my experience and accomplishments would get in the current market?” Note: you’re not asking the minimum, you’re asking to be in line with the market. Presumably, you have accomplishments that argue in your favor to get a raise that puts you a few thousands dollars above what a newly hired employee makes.
Lily in NYC* April 21, 2015 at 2:21 pm Like Alison wrote in her first sentence, I know the advice is generally not to compare salaries, but I have to say, it is the main way people have gotten raises in most of my jobs. And I hate that my salary is public because my coworkers tend to use me as the comparison when they want a raise and I can’t help but worry about it sometimes.
staying nameless for this* April 21, 2015 at 2:22 pm Thank you, Allison, for answering and posting this letter. And thank you, AAM community, for your comments. I will be reading every thing very carefully, as I am now in a similar position. And I need to move fast with talking to my boss, as this is the time when next year’s budgets and salaries are set. I recently took on oversight of all human resources and payroll functions of our organization, along with oversight of many other things, and I am doing very, very well. I have made a ton of improvements and saved my organization money and reduced risk exposure. Part of my job now is to review and approve payroll before it is finalized, and I was dismayed to learn that I am the lowest paid person at my level, even though I have responsibility for the entire organization, not just a project or small functional area, and I manage the same or more employees.
staying nameless for this* April 21, 2015 at 2:31 pm Just wanted to add, I was planning to speak with my manager about increasing my pay due to my accomplishments this past year. I was already a little unhappy with my rate of pay and was hoping to have a good conversation about my role and value. But when we hired a new payroll person and I was made that person’s manager, I found myself in the awkward position of knowing what everyone makes. I did not want to use that to make comparisons, I want to focus on the value I bring to the organization. So the information provided by all of you is very helpful.
_ism_* April 21, 2015 at 3:30 pm I ran across the wage listing for all our temp labor while I myself was preparing to be moved from temp labor to permanent employee. I’m known as the Excel wizard around here, and the payroll guy called me in to help with an Excel formula on a spreadsheet listing what we pay the temp agency for each temp staffer and what their base hourly rate is. I was livid. On the sheet, I saw my company was pays a premium to the temp agency for temp labor, which I didn’t know is how it works. When they offered me full time employment at the same hourly rate that the temp agency was paying me, I realized they’re SAVING money on my wages now that they don’t pay a premium to the temp agency. Is this fair? There is no history for my role, I’m directly assisting the Big Boss with just about everything she has her hands in, and the role was created just last year.
Apollo Warbucks* April 21, 2015 at 3:34 pm That is not the case, there are a lot of employment overheads that are not reflected directly in salary costs.
Zahra* April 21, 2015 at 3:55 pm At least in my province, there are employment taxes to be paid, private insurance premiums (if the company pays part of it), public health service fund, the employer part of parental leave fund (that one is less than 1%), and various other federally or provincially-mandated contributions. The overhead on a salary is about 50%.
E* April 21, 2015 at 4:00 pm The premium paid to a temp agency also is partially for your taxes, since the temp agency is your employer for taxes. They make a small profit, but not as much as you’d think after benefits and taxes.
_ism_* April 21, 2015 at 4:19 pm I didn’t think about it this way since I’m newly out of the temp category, but you do have a point. The company is paying for benefits for me now, which I didn’t get from the temp agency. I wish I had all the numbers, but sooner or later I’ll come across them. People are careless with sensitive data here, printing things like a list of employee’s wage garnishments to the common printer! Now I know who pays alimony and who’s in default on their student loans. :/
staying nameless for this* April 21, 2015 at 4:25 pm You might enjoy doing the comparison. We did this analysis recently to compare the hourly rate of hiring our own employees versus contracting out. It is actually more expensive for us to directly hire a certain type of hourly worker than to hire temps, believe it or not!
_ism_* April 21, 2015 at 4:29 pm I am a nerd so I look forward to when I have the info to do so. The only unsuual thing is my role. The company uses temp labor for the “blue collar” work – factory and shipping labor, and always has. But they’ve never hired through the temp agency for administrative office work, which is the case for the role they created “for me.” I’m not getting paid any more than the factory and dock workers through the temp agency, but I’m very curious how my wage compares to the permanent factory/dock wages.
Jamie* April 21, 2015 at 4:55 pm Correct. I had the same reaction as _ism_ years ago on my very first temp job when I opened the invoice for myself to sent to AP. Temp mark-ups start at about 35% in my region (for labor – varies much more for office and tech) and it seems incongruous at first – the company is willing to pay so much more for me, but I don’t see all of it. The temp agency earns that markup (and the company is willing to pay it) because they are processing your payroll, they are tracking your vacation accruals (most of the agencies here give you vacay time once certain hours are worked), the company doesn’t have to worry about paying unemployment if they no longer need your services (and this one is HUGE – the more unemployment cases they lose the higher their premiums for years), and the agency has done all the background checks requested, screened for skills, checked for legal authorization to work…this is why they are willing to pay. And the temp agency has to maintain business relationships with companies that might need temps and with people looking for temp work – that’s a huge service to both sides to have someone to match their needs. Can you imagine trying to find temp work if you had to call each company directly? They don’t charge temps to place them, their money needs to come from somewhere. And I all agencies I’ve worked with (a couple as a temp and maybe a dozen from businesses who use agencies) charge a placement fee to hire that person on permanently within a year of the last day of their last assignment. When I went from temp to perm with one of the clients I temped for they paid 38% of my yearly salary – it wasn’t cheap. If your employer had to do that as well it’s also a cost of hiring you, albeit a one time deal. An real employee cost (as opposed to just salary) is often figured between 1.5 and 2.5 times their salary – depending on a myriad of factors from position to benefits to a million other things. Typical values for the breakdown of employee costs excepting salary (and this is general) is 35% benefits, 25% overhead, and 18% General & Administrative. So if you make 50 K a year and splitting the difference between the range of cost multiplier values and using 2 you’re costing your employer 100k a year to employee you. If they employee you through a staffing agency for a year at a 43% markup (not sure what’s typical for office labor now but my first temp job had a 43% markup so I’m using that) they’d have paid 71,500 for you for that year. Obviously there are benefits to the company to have employees and not all temps, but if you’re talking about real dollars they are paying a lot more to employee you than you see in your checks.
NotFunny* April 21, 2015 at 5:19 pm Interesting, I didn’t know they had to “buy me” from the temp agency.
Jamie* April 21, 2015 at 5:31 pm I don’t know if it works that way everywhere – just my experience. And I’m sure you were kidding, but they aren’t buying you they are buying out your contract. If mine had wanted to buy me as opposed to my contract it would have been a hell of a lot more money than 43% of a modest salary! In agencies where this applies temps sign a contract including these terms about accepting permanent employment from a client (for whom they’ve temped) and so do the companies requesting the temps – it’s no different than switching your phone mid-contract from AT&T to Verizon – if you can’t get them to let you out of their contract gratis then there can be a hefty buyout. As an aside – this is typically not the cases for large number of temps in a labor environment – it’s SOP for those contracts to stipulate the right to hire direct without paying a fee as well as a lower mark-up because they are making up the costs in volume. It’s also not the case when you are to be a direct hire, but the company wants you to do a week or two through the temp agency they use as a trial period – which sounds weird but is fairly common in my industry/area for office jobs.
_ism_* April 21, 2015 at 5:36 pm I think my company just put me through the same wringer as all the labor. Only a small percentage of the labor temps get hired on, and it usually takes a few months. They had me through the temp agency for 8 months, and hired me on permanently on New Year’s day. 8 months is well past the time they needed to try me out, but I suspect the date they decided on had more to do with fiscal/benefit years.
Jamie* April 21, 2015 at 6:02 pm I bet you’re right – the timing of it says there was probably an administrative reason it was easier for them to do it first of the year. I’ve seen things go a long time because of labor fluctuations and they didn’t want to over-hire if customer demand dipped, easier to enroll a bunch of employees in benefits en masse than one at a time so had to wait for them to decide on everyone, not wanting buy out fees (if any) to come out of the labor bucket until bonuses were paid…really could be anything. I worked at a place that was supposed to be temp to perm – temp for 4 months. Well the week my 4th month was up I called my agent at the temp agency and asked them how it worked with negotiating perm salary, etc. She couldn’t have hedged harder – I was so naive I assumed 4 months temp meant just that. I mentioned it to someone at work and they laughed and pointed out several other temps who were also supposed to be perm after 4 months – and they’d been there from just shy of a year to over 3 years. I was shocked – but not as shocked as the manager was when she realized I actually expected them to abide by what they said. Not that they had to hire me, but she was shocked I expected a discussion. Called my agent and said as far as I was concerned I completed my contract as I’d done 4 months – no discussion of perm meant my contract was over. I was new to the workforce and I walked out of there crying feeling like a failure that they didn’t want me, feeling so stupid that everyone else seemed to get how this stuff worked and I was skipping through life completely unaware that there was a temp limbo – even when I was living in it. I look back and remember how very angry I was; actually felt personally betrayed because I had lived up to my end of the bargain and they didn’t think I even deserved an explanation of why they’d changed their side of the deal without telling me. It wasn’t the job – it was a crappy job that didn’t pay much…it was just feeling dismissed as a person – feeling completely and utterly irrelevant. I didn’t know how to process that. (I just googled them and they went bankrupt several years ago…they don’t mention that it’s because their management was made up of tedious suck monkeys, but you know it was.)
staying nameless for this* April 21, 2015 at 4:23 pm The others are right. Depending on where you live and work, required employer payments such as taxes and workers compensation insurance alone can add a big chunk. If you are getting benefits, including paid holidays, vacation, and sick time, there is another big chunk. So your employer may not be saving any money at all, or may be saving a very small amount.
Judy* April 21, 2015 at 4:24 pm If you’re in the US, then the temp agency has to pay the employer’s part of the payroll tax (SS) which is 6.2%. The temp agency would also have to pay the state unemployment taxes. The temp agency has to handle your withholding and pay for someone to do the books to send you a W2. The temp agency has to pay for workers compensation insurance for the temp employee. This is just for the temp employees who are already working. The temp agency also has to pay someone to find new workers and screen them for the employer. Your company will now have to do all of that, along with any benefits you’re getting like health, vision and dental insurance, life insurance, long and short term disability insurance and any retirement pension or 401k.
voyager1* April 21, 2015 at 4:44 pm I think some of the comments are great, just want to add one thing. If your boss tells you know, they is agood chance they will assume you will leave. That can effect other things later on when it comes to development or reviews etc. Just something to keep in mind.
Dawn88* April 21, 2015 at 7:10 pm Alison is spot on. Since you do payroll (and I’ve done it 15 years myself) you must be very careful with this. Part of the job responsibility is not to concern yourself with everyone’s pay, or voice your feelings or opinions about it….EVER. If he nags you for an “opinion,” I always said, “Raises are based on performance and responsibilities.” Nothing more. The good news is you are aware and know facts, not guesses. This is considered Top Secret information at any company. No matter how you may feel “justified” because someone else (doing less) is overpaid, or think someone is underpaid, you never bring it up…NEVER. When negotiating for a raise, you have to do your homework, such as a concise, fact based list of extra duties and responsibilities you acquired the past year. Don’t overdo it, just summarize. If you had perfect attendance, add that too. I’d do a list and have it ready for the chat. Focus on your job performance, period. You are asking for a performance-based increase, based on facts you’ve gathered that you would like to review with him. Keep a poker face, and be careful not to slip up….or get tricked into it. If your boss says something like, “Oh….I figured you’d be asking me, since I gave Bob 10% more this year because he took on that extra team…” Act like you don’t hear it. Don’t acknowledge, nod or agree with comments about anyone’s salary. Don’t take the bait. “My reasons for an increase are based upon my additional tasks of A, B and C, and my increased responsibilities of X, Y and Z this past year. I also put in extra time and effort for the X project, and have met every deadline I was given since I started here.” After you give your list of reasons, “I jotted these down and here’s a copy for you.” Don’t say, “Yes, I’m aware Bob got more for his increased workload, but….” Don’t even say Bob’s name! After you state your case, concisely and clearly (in a nice tone of voice), hand him a copy and SHUT UP. Look down at your papers and pretend to write notes….JUST DON’T SAY A WORD. You’ll be very nervous, but don’t show it. Bite your tongue! The theory is, “He who speaks next, loses.” There may be a l-o-n-g silence….then he’ll have to acknowledge you and give an answer. Seeing it in writing always helps. Be sure you have your numbers ready and don’t fumble! Good luck!
Jennifer* March 8, 2017 at 3:44 pm What do you do when you know your manager is getting 2 raises a year that are over 11% then plays ” Oh , I got you a great raise of 2.5% ( I receive only one raise per year) for outstanding work performance?