Your IndustryJan 27 2016

I can’t afford to lose a worker – or pay him more

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Q: I have recently had to reject an employee’s request for a pay rise due to having insufficient funds. However, I am worried that because of this, the employee will now start looking for alternative work. I do not want to lose the employee so what would you suggest I do?

A: Sometimes pay is not the only influence on an employee when they are considering whether to stay in the same job or look for a different one, so you can look at the employee’s overall package, and any other area of the employee’s role or terms and conditions to assess whether enhancements can be made.

The employee’s specific role in your company will largely dictate where you may be able to make changes, but consider whether you are able to offer more flexibility in the hours that the employee works, or perhaps with the amount of hours that they need to be in the office. Homeworking is an increasing point on the wish list of employees and allowing the employee to work even one day a week from home rather than having to do the daily commute every day may be a good way of increasing loyalty.

Giving the employee more autonomy to make their own decisions is another way of giving reward and showing recognition. It can work to elevate the employee’s perception of their position in your organisation without actually giving them a promotion. Giving someone the freedom to come up with their own ideas and put them into motion, therefore having more opportunity for self-development, can really help them to get more satisfaction out of their job.

Where new projects arise, get the employee involved. Giving him a wider remit and making him feel more useful may well fulfil his desire to be rewarded at a higher level. Give him the opportunity to go home feeling as though he has made a difference.

While none of the above will have the same effect as an increase in the monthly pay packet, these measures show that you are investing in the employee in a different way, and that he is a valued member of staff. It will also help to communicate to the employee that when the situation gets a little easier in terms of cash flow, that you will look to review the employee’s salary. Do not fall into the trap of making promises you cannot keep, so you should be careful what you say.

There is obviously another perspective to this which is that you should do nothing and wait and see what happens. There is always the opportunity to offer enhancements when an employee has resigned, in an attempt to keep them at your organisation. The risk with this is that the employee may consider it too late for their mind to be changed.

Peter Done is managing director at law firm Peninsula