Value Propositions For Employees Seeking A Raise

Problem

"One of the engineers, who had been working with us for 18 months came to me and said he wanted a raise. I had thought he was unhappy and wanted to quit, so this surprised me. He was a good coder but not outstanding, he didn't have a lot of initiative, and he didn't really put my feedback into practice all the time."

Actions taken

I decided to question him around why he wanted a raise and why he thought he deserved one at that point. His first argument was that he had done his research and the rate he wanted was what the industry was paying. I pointed out that generally when people talk about engineers being paid a certain amount, it refers to an average, that people had generally worked hard to get that, and then asked him what he had done to earn the raise.

"He was then faced with presenting his argument. As he started to say details out loud he realized he couldn't lie about them, because we had established very clear criteria for success that he had not achieved. He admitted to not finishing things, and not meeting his goals, and began to backtrack a little."

I stated that as a startup if you want support from a VC, you have to do a lot of work upfront, you put in a lot of hours, and you try to prove yourself before asking for money to continue that work. I asked him to imagine me as the VC and that he wanted a raise - he needed to show me that the investment would have a good return for me. Up till that point, he had a pretty bad track record.

Next, I told him that if he wasn't happy there I would happily get him another job, but if he wanted to learn more python and expand his role and be a leader, he needed to work harder. I pointed out that he wants something from me, a raise, and I wanted something from him, quality work. I told him that I would verify with HR whether I could give him the money he requested, and three months from that date I would review his work again to see if he had turned around all of the problems we had discussed. I encouraged him to be a better leader, talk about the company positively and not to allow himself to get into situations where he was complaining.

"Following this discussion, the engineer quadrupled his output, he became a phenomenal leader, echoing a similar message to others working with him, and my one-on-one's became much more productive. He was given the raise, and he said that the fact he had worked so hard for it had made it mean something. By being honest with him, and not trying to talk around the subject, resonated with him. I also think the metaphor of how business really works helped clear up a large misunderstanding of the relationship an employee has to a business. It's basic ROI. We invest in what yields returns."

Lessons learned

I have found that telling an employee that you will help them to find a new job if they are unhappy gains you a lot of respect, as they realize you care and are more open to you helping them to find a better direction for them. I went in assuming he meant well and used facts with him to point out what needed to change in order for him to get a raise.

"There are times this won't work because the employee is too at odds with your company. In these cases, it can be best for them to move on. How long it takes for people to change really depends on how much an employee wants it. In most cases, you can't give people all the money you want. So, before promising money to someone, make sure you verify with HR that it is possible. You don't want to promise something you can't deliver."