Tips for Talking Pay with Your Employees

It’s a common-sense assumption that the details of wages, salaries, and other compensation conversations ought to be handled with some amount of tact by employers. For employees, their pay is a way of estimating their value in the workplace, and wages that are too low can feel insulting or even exploitative depending on your workers’ estimation of the worth of their work. 

This quick guide will cover four professional tips for managers to discuss pay with their employees. Read on to learn more! 

Pay and Salary Can Be a Sensitive Topic

Most professionals in the working world know that pay conversations can be a very sensitive topic, especially when one side of the conversation thinks that the current salary is insufficient! Horizon’s blog will address how employers should navigate this tough topic with their employees. 

Risks of Not Discussing Pay with Employees

While your first instinct may be to stand by your decisions and refuse to discuss issues surrounding employee salary, abdicating the responsibility of having open and honest discussions with your employees about their wages can have significant negative and costly results!  

Employees Can Harbor Resentment Over Wages

Your employees may resent you and other members of your management team if they cannot discuss their wages with their managers. Perhaps they have a particular grievance with their salary range, and the lack of openness may prevent them from indicating this to you, leading to further frustrations. Additionally, simply the fact that you aren’t discussing wages can make employees feel as though their feelings are not important to you, which can also create resentment in the workplace.  

Communication is Crucial to Employee Satisfaction

Part of building a strong team in the workplace is consistent and clear communication about every part of the job. Without it, your employees may have difficulty trusting you, and they may assume that you don’t understand the struggles of their particular position, or that you don’t care to know their thoughts on the workplace you run.

This holds doubly true when it comes to important HR matters like pay or workplace satisfaction. You may feel as though you have good reasons for making the choices you do, and this may well be true; however, those not clued into the process of assigning wages may not understand this without direct communication. 

Our Tips for Discussing Pay with Your Employees

Though discussing a pay raise with your employees may seem somewhat nerve-wracking, there’s nothing to fear! By following a few essential principles, you can have a conversation conducive to understanding and compromise on all sides and eliminate any potential tension before it even begins. Whether you’re negotiating with employees about a salary increase, listening to their grievances about their current pay, or simply disclosing wages to workers, ensure you’re employing the following tactics to ensure the conversation goes well for all involved parties. 

1) Treat the Conversation with Respect and Openness

Respect and openness are crucial in determining whether an uncomfortable discussion like a pay increase will go well. Nobody wants to feel as though their boss isn’t being honest with them, or worse, that their boss doesn’t respect them or their point-of-view.

As an employer, you also have much to gain in terms of team cohesion, trust, respect, and more by honoring your employees’ viewpoints rather than pushing them aside. Try to go into discussions about pay with a spirit of openness; avoid having too strict of an agenda that you shut down what your employee is trying to say to you off the bat.  

Understand the Employee's Point-of-View and Listen to Them

Understanding the employee's perspective is still incredibly important even when we disagree. You may even have some things to learn from listening more intently to your employee’s complaints. Perhaps you’ll discover that your pay decisions aren’t quite as fair as you had initially thought or that there are factors you hadn’t considered when choosing wages.  

2) Explain the Decision-Making Process Behind Wages

In order to get everyone on the same page about how and why wages are assigned, be sure to explain the precise reasons for your choices. This clarity shows your employees that pay decisions are well-founded, well-researched, and not based on personal preferences or biases. This alone may quell some of your team’s worries, since they can rest assured that you deliberated over these choices impacting them.

You do not have to share information about the wages earned by other employees. But by providing transparency into the factors that make up your payscale decisions you can significantly improve conversations about an employee's pay. 

Do Research and Have Market Statistics Available

Research and market statistics can help bolster your point in demonstrating evidence-based decision-making. If you can point to the estimated market value of an employee’s work not just in terms of your individual firm but in terms of a greater statistical trend for the position across the entire economy, it helps take a bit of the pressure off of your management team.  

3) Don't 'Beat Around the Bush'

Ambiguity isn’t helpful when it comes to discussing many sensitive topics, especially when it comes to issues in the workplace. Avoiding outright discussions of your worker’s claims is not just unfavorable for having a productive conversation; it’s also quite unprofessional, and it’s a habit you should nip in the bud wherever possible.  

Be Direct and Honest in the Conversation

With this principle of avoiding ambiguity comes the responsibility to be direct and honest. This ensures a much more efficient discussion of questions and concerns about wages and prevents any misunderstandings between yourself and your team.  

4) Try to be Prepared for Any Questions that May Arise

Being prepared to answer any potential questions or concerns can never hurt! Review some potential questions they may ask you about your decision-making process and other areas related to pay before actually sitting down with them. This will smooth the process and facilitate better communication between you and your employees.  

Be Ready for a Follow-Up Conversation

It’s not unlikely that your employees may have questions or concerns they couldn’t voice during your initial meeting. That’s okay – be prepared, and understand that pay conversations may be ongoing. While that may seem frustrating, it’s an excellent opportunity to demonstrate your willingness to field concerns from your team.  

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