Talking with employees about money can be an awkward conversation to have. Still, it’s a topic you will eventually need to cover. Raises, promotions and bonuses are part of the compensation package at many companies, and of course before they happen, you need to let employees know. With practice and the right skills, you can ease the pressure of conversations about money. Just follow these tips from a top provider of employment agencies in Nashville, TN.
Don’t Let it be a Surprise
You can pave the way for your annual compensation conversation by laying the groundwork during the year. Most raises are based on performance and employees hitting their goals. So, if you’re meeting with each employee regularly to review their performance, they should have an idea of what their compensation may look like come annual review time.
Don’t Tie Performance Directly to Compensation
It’s important to discuss the value each employee brings to the company. A conversation that covers both performance and pay will likely only spark an employee’s attention to the part about money. To be sure you have their full attention about their performance, prepare to review this first, and then hold a follow-up conversation about raises.
Be as Transparent as You Can
Explain the reasoning behind monetary decisions the best you can. It can help to give context. For example, if a high-performing employee met all their goals but received a bonus that’s less than they expected, it could simply be due to the company tightening its budget for bonuses across the board. Any information you can supply about the pay structure can help ease a conversation about money.
Practice What You’ll Say
Don’t put yourself on the spot. Plan what you want to say to your employees and consider how they may react. Have answers ready for both positive and negative reactions.
Stand Your Ground
If an employee is displeased with a raise or bonus (or lack of), offer to look into it and report back at a later date. This can help diffuse a situation and give the employee a chance to calm down and gain perspective over the situation. Don’t set the expectation that complaining will always result in a pay bump, as this can be dangerous for the future. But if you offer to look into the situation, follow through and report back. It may end up as the same result, or with a change that will please the employee.
Need More Information?
To learn more tips for difficult conversations with employees, check out this resource from Wood Personnel. And if you’re in the market for new employees, contact us today! We’ll work with you to understand your staffing needs and find candidates who fit.