Money Work An insider’s tips on how to ask the boss for a pay rise
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An insider’s tips on how to ask the boss for a pay rise

how to ask the boss for a pay rise
If you want a pay rise, it's essential you do your homework on how the company is faring. Photo: Getty
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In a perfect world, you should never have to ask for a pay rise.

After all, an astute manager or supervisor should have a good idea of what you’re worth, and take the steps to ensure you receive the best possible remuneration.

If that sounds a little delusional, it is. And in a world where employers fight hard to contain their fixed costs, you’ll have to fight equally hard to justify a pay increase.

Asking for a pay increase at the best of times isn’t easy. But if you know how and when to ask, you’ll give yourself the best shot of at least getting a fair hearing.

Given that you always want to negotiate a pay rise from a position of strength, there are certain things you need to consider before you plunder on in.

Don’t misread the tea leaves

Where most people go wrong, says Professor Gary Martin, CEO with the Australian Institute of Management (WA), is when they misread the tea leaves, and/or assume that their employer is obligated to automatically increase salaries from one year to the next – even if only in line with CPI increases.

Flat-lined, at an annual pace of 2.3 per cent, wage growth remains low across almost every state and industry.

With wage growth expected to remain low, Professor Martin says employees need to be sure of their value within their organisation and their key achievements before asking for more.

Given that employers are expected to continue to offset future increases in compulsory super with lower annual wages, Professor Martin argues that most employers are hell-bent on maintaining their costs, just to remain commercially viable.

Unless you want to end up looking foolish, he suggests you really need to do your homework before going ‘cap in hand’ to the boss for more pay. For starters, he suggests taking the time to honestly assess your role within the organisation.

To second-guess if you have an inflated sense of self-worth, he recommends talking with your peers, and/or a recruitment consultant who specialises in your field.

”Remember, someone who has achieved hard targets is less likely to be considered for a raise if they have been extremely difficult to work with, and has damaged the organisation in the process,” he says.

Understand what shape the business is in

Secondly, he suggests reading the mood of management, and the basis on which previous pay increases have been made. For example, he says it’s hard to even broach the subject of increased employee benefits if management simply refuses to talk about it.

Rather than being worthy of a pay rise, some bosses may consider the good job you’re doing as merely adequate to retain that position.

One of the optimal times to ask for a raise, he suggests, is after your role has been expanded, and you have executed new responsibilities well, and/or demonstrated an increase in revenue generation.

“If you have been ‘kicking goals’ over an extended period, and you’re not seeing any monetary reward for it, then it might be time to ask for a raise,” Professor Martin says.

“But success might hinge on your preparation, including information on what other organisations pay for similar roles, and any data that shows how you have outperformed expectations for your role.”

However, when discussing salary, Professor Martin warns against backing yourself into a corner. While you need to build your case for a pay increase in a confident manner, it’s equally important to handle rejection well to ensure it doesn’t compromise future salary discussions.

“It’s also important to be open to non-cash incentives, like additional days leave or flexible working arrangements, which can make a position more attractive,” Professor Martin says.

“Similarly, never ‘burn your bridges’ by threatening to leave the business if you don’t get a counter-offer to stay, unless you have another job offer on the table, and are more than willing to walk.”

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