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.
I would make the wild guess that you pay your office manager more than you pay him, he now knows this as the are a couple, and he would like to get on a more even financial footing (even though they perform totally different jobs).
As far as how to handle it, you’ve kind of answered your question. Employees are paid for value, if the $28 is replaceable at $22 w/o much hassle then maybe you offer $23. Replaceable at $20 then offer $21. We value low turnover so we try to pay better than market b/c it’s a hassle for us to hire, train and trust someone new. We are profitable so it’s worth it to us, but there is a point where it is not. It sounds like $28 is a point well above the hassle threshold for you, but maybe there is a number between $18 and $28 that is not so give it a shot. I don’t like the idea of canning someone just for asking for a big raise, unless “unreasonable” expectations/demands is an ongoing issue.
Then the question becomes will he stay for less and if he does will he be happy, and if he’s not happy do you still want him around? Research your labor laws in that case.
Final point, you may ask him to justify the $28 rate so that when you offer less he understands he is out of line with the market for his position (assuming he really is replaceable for much less).