Saying ‘Not Right Now’ Instead Of ‘No’ to Pay Raise Requests

Problem

We decided to take a chance on a design intern who had shown great potential and aspired to become a software engineer. When we offered him a full-time position, he asked for more money based on the market salaries at that time. Honestly, I did not feel as if he was ready for this type of pay raise yet, but I was unsure how to tell him that.

Actions taken

• I told him that I really liked him, and that as a company, we saw potential in him, but that we were hiring him based on this potential and it, therefore, needed to be proved before we could justify a pay raise.
• Although he was disappointed, we came to an understanding that having been hired on potential, he needed to first achieve several clear goals that my partners and I had laid out for him.
• The specific steps that he needed to prove he could manage were as follows - taking ownership of the code, asking more questions, getting code reviews/owning that himself, and becoming comfortable in client meetings.
• In addition, we offered to reassess his progress on a regular interval and if he was indeed achieving these goals, then we would give him the pay raise he had asked for.

Lessons learned

We have an inbuilt advantage around retention due to the cutting edge and fast paced environment we work in. Getting to learn a lot of things quickly is what excites people when they join us. At the time of this story, the junior engineer had been working on a Google watch face that was picked up and featured by Google. Those kinds of projects and that kind of work isn't easily available everywhere. This inbuilt mechanism helps us attract and retain junior employees who get a boosted start to their careers.
By not caving in early ad we wanted to retain the employee, and establishing a series of milestones, we created a really positive scenario 6 months later when the engineer did meet those milestones and we were able to give him a raise and retained him for the long-term.