How do you guys handle it when a relatively good employee asks for an outrageous raise? I just had a guy who is being paid $18/hour ask me to be paid $28/hour. He’s a decent worker, but really not particularly skilled at anything. I have much more skilled employees that make less than what he’s asking for. This person does mostly odd jobs throughout the business. He said he came up with that number because represents a 10% raise for each year he has been here, though the math clearly doesn’t work on that; he would be at less than $24/hour even if I had given him a 10% raise each year.
I agree he deserves a raise, but that amount is crazy. I can hire much more skilled and competent people at that rate. I’m somewhat indifferent to whether he stays or goes, but I don’t see him really quitting as he and my office manager are a couple, and they like to commute to work together. I can handle things if both of them quit. Life would be less fun for a bit, it’s not the end of the world. I don’t see any real scenario where they will be otherwise able to work together like they do now.
Be straightforward. Tell him the amount of raise you are willing to give him. You said it yourself that it don’t matter if he quits or not. So, be direct and tell him that.
Living wage in Chicago is 68k a year so guy is at poverty wages.
Easier to keep than to train. Offer him 23-24 and add some to his responsibility. Not a lot just a couple things.
He wants to ask for 28 in hopes of getting 24. Seems smart and if you don’t give him a substantial one you will lose him. New employee without any experience will probably want 25.
How in the hell do you know what a replacement will cost?!? LOL
What I’m hearing is he’s a good employee you haven’t given any raises to the whole time he’s been there and now you’re surprised he wants what he feels he’s worth. Based on 2k hours at $18/hr he’s pre tax at 36k. He’s living in poverty.
If this is even close to accurate give the guy $23 to $25 and change his life for the better. Or you will have to replace him and as others have pointed out get to retrain a new that will want $25.
The only thing outrageous is how you are treating a dedicated employee 🤷
Here is the problem. Rampant inflation has caused there to be a fundamental inability for business owners and employees to really understand each other.
The business owner may not be able to afford to pay $25 per hour. And the job may not warrant that. And that does not mean the business is not viable, either. As I know that’s the go to of the antiwork crowd.
The problem isn’t wages, the problem is prices of rent, food, cars, and other necessities to live. But those entities that are ripping people off have made all of the antiwork crowd believe the problem is small businesses not paying enough.
Kind of sounds like he is mediocre at best. And what he feels he’s worth and what the books say he is worth are two very different things. So the business owner should just “give the guy $23 to $25 and change his life for the better?” I don’t think you have ever owned a business and were required to meet not only a payroll but all the additional overhead. You can’t just “give the guy…” That’s what the government is so good at doing but just doesn’t work as well for a business trying to stay afloat.
Is getting a raise of 10% a year standard? I worked in finance for 12 years before owning a business and never saw a raise larger than 5% unless it was with a promotion that included more responsibility.
I think even 5% is generous and wouldn’t be automatic for most people. Obviously, if you have a superstar performer, that’s different, but somebody who is mediocre, or nothing special, I would have a hard time with some idiot coming up with his own imaginary math and something that ridiculous. it would probably make him even less desirable to keep around after that.
No, 10% is a really good raise. I give raises that: 1) cover cost of living increases, 2) recognize a promotion, 3) recognize increased responsibility, 4) adjust for a salary imbalance, or 5) recognize increased training and output. I recognize special achievements by giving a bonus at year end.
So my raises typically have been 2.5% to 3.5% for cost of living. This year they will be 5%. I’ve given bonuses as high as $12,000.
Something to think about and learn from this situation is you need to have metrics and your kpi’s in place. This will give your team something to work towards as well as a tool to measure their performance.
You are going to have people say that you aren’t paying enough, treating your employees like shit, etc. but here is the thing. They don’t know your numbers, they don’t know what you do, and they don’t know the ins and outs of your business.
I always fire employees who do this.
There is no path forward. You know they won’t be happy no matter what. Harbor feelings that you are underpaying. Probably looking elsewhere. Etc. Don’t invest in these people.
If they want to play their hand like that, then they better have a good hand to play.
He didn’t. He lost. Fired.
You can’t fire someone for that. What is wrong with you?
He wants to be paid 55% more? The answer is “lol.”
But you can humor him. Have him explain to you how much more productive he is than anyone else with a similar wage. Is he doing the work of two men? Because for 55% more, he needs to be. Let him justify how paying him that much more will make you more money than hiring different or additional people.
I certainly don’t think 55% raises are outrageous, especially when someone is making that little to begin with
Many employees feel they should be paid by how long they’ve been there, not for their performance. Constantly you see in Reddit, “I’ve worked here longer but this new guy gets paid more than I do!”. It’s important that employees know what it takes to get them higher pay and they need feedback when they fail to do it. Also, don’t forget, most businesses don’t need ALL employees to be high-level, high-performing and highly paid. You’ve got entry level positions, mid and high positions. If there are no mid or high positions available to promote you, you should expect some low-level turnover
All that really matters is how much you want to keep him, and how likely it is that he can find better elsewhere. Have you not been giving him an annual raise? Why is he calculating a 10% raise over multiple years? If you haven’t been giving annual raises, and considering recent inflation, it’s possible that you’ve fallen significantly behind the market for his role. It seems like a big jump but you haven’t provided enough info to definitely say it’s unreasonable.
have you not been giving raises all those years?
10% compounded? Had be been there for 5 years that would actually be $29 an hour.
$18 to 28 is outrageous. Sounds like he’s looking for you to give him a reason to resign.
I’m in a HCOL state with a min wage of $15 (which I feel should be at about $22), so I don’t consider $18 spectacular. That said, I pay non-skilled employes $20/hr part time and I pay $25-30/hr on day long projects with the $5 differential to 30 for night and weekend work.
In your case, my considerations would be:
- What does your competition pay their staff for similar jobs with similar experience?
- What is his overall value to the company? If he leaves today, how does that impact the company?
- How easy will it be to replace him, considering learning curve & ramp up time at a similar wage?
- when was his last raise and how much was it?
If it’s been 1 year and you value him, I would increase him around 5% if that’s in line with everything above.
If it’s less than a year, you need to decide based on those factors.
I gave raises based on 6 month reviews.
I never gave a raise to anyone who asked for one because they either got one within 6 months or they weren’t deserving of one.
Employees with unrealistic expectations of their worth or position expectations aren’t worth working with. It is a sign that they aren’t thinking clearly or that if they have the opportunity they will leverage you in an emergency. Get rid of him asap. Couple’s at work are another red flag. If they ever decided to steal from the company, they would be in a really good position to do so.