Tips for workers seeing a raise—and for managers considering the request

Whether you’re an employee asking for a raise or the manager fielding the request, a compensation conversation can be stressful. Information is the key to a confident and successful negotiation for both sides, experts say.

“Research upfront is critical,” said Karl Knapp, dean of the University of Indianapolis School of Business. “Managers have to know what the labor market is demanding. And employees need to know, what are the comparable salaries at similar firms for people doing similar work? Once you have the knowledge, then you can put it to use.”

Here are five tips from experts for employees seeking a raise and five more tips for their bosses.

If you’re the employee:

1. Do some self-reflection to make sure you know what you want.

When we’re frustrated in a job, our first thought is often that the work would be easier or more enjoyable or just more tolerable if only we just made a little more money. But will a higher salary actually solve the problem? Be honest with yourself in the answer.

It could be that what you need is more time off. Or a different manager. Or even a different position. Maybe it’s one or more of those changes, along with a pay raise. Be ready to talk to your manager about each of your key concerns.

2. Be cognizant of the timing of your ask.

If your company is in the midst of an especially challenging period or the market for your firm’s products or services is going south, think about whether this is the right time to ask for a raise. On the other hand, when profits are on the rise and your company is expanding—especially if it’s hiring—this might be a great time to review your compensation.

Also, does your company have a regular review period or an annual time to talk about compensation? Should the conversation wait until then? If not, think about whether you’re OK having a conversation about compensation now with the goal of receiving a pay raise at a later time.

“If there’s no official schedule for salary increases, pick a time when you are clearly showing your value,” writes Caroline Castrillon for Forbes.

Finally, think about timing from the perspective of your immediate supervisor. Is she facing a big deadline? Is he about to leave on a two-week vacation? If you can, wait until your manager isn’t facing a key deadline. Then ask for a meeting. Don’t expect to spring a request on your manager and immediately have a conversation that leads to a raise.

3. Come with knowledge and numbers.

Just like you do research when preparing to pitch an idea or make a sales call, you need to go into a salary discussion armed with data. How much are workers doing similar jobs at competing firms earning? What could you make if you jumped to another company? How do your company’s benefits—particularly the cost of health insurance and the value of benefits such as a retirement contribution match—stack up against those of other companies where you could work?

Use websites like Salary.com, PayScale and Glassdoor to gather information. Even better, talk to people who work in your industry.

Also, figure out how to quantify your value to the company. You could use sales figures, previous performance reviews, customer service scores, program savings and more.

“You have to be able to demonstrate that you’re worth [a raise], that you’ve been exceeding your job expectations and you’re worth the investment,” Knapp said.

And once you’ve made your case, be confident in your ask.

“When we fail to recognize our own value, we are vulnerable to accepting less than we’re entitled to,” according to a salary negotiating guide from Harvard Business Review. “It’s important to be fair to your employer, but you also need to be fair to yourself.”

4. Be positive.

When it’s time to have the conversation, focus on what you like about your position, what you have brought to the organization and what you can do for the company going forward. A positive attitude is less likely to put your manager—or his or her bosses—on defense.

If you can’t find positive things to talk about or can’t see how you can help the organization moving forward, you might need a new job, not a raise.

5. Know your bottom line—but be prepared to be flexible.

It’s important to know what you want going into your meeting. But you might have to start with a slightly higher number—the conversation is likely to be, after all, a negotiation.

“I advise asking for slightly more than the amount you actually want,” writes Jennie VanderHooven, University of New Hampshire’s academic adviser and career specialist. “For example, if you’re hoping for a 5% raise, ask for 7%. It’s likely that your manager will counteroffer with something a little lower than what you ask for. By adding that extra padding into your request, you’re accounting for negotiation. This will make it more likely for you to receive the amount you want.”

Be prepared as well to consider whether a salary increase planned over time or an increase in vacation time or a bonus will satisfy your request.

Knapp said to be prepared to “give the manager time, because the manager is probably going to have to engage with human resources to understand the current market and what you’ve presented.”

And if your request is reasonable, he added, “then hopefully they’re off negotiating on your behalf.”

If you’re the manager and a direct report asks you for a raise:

1. Think before you respond.

It’s easy to be defensive or frustrated when an employee—even a key employee—surprises you with a request for a raise. Don’t let that show. Take a deep breath, and if you don’t have time to adequately address the issue in the moment—and that’s OK—set a time for a meeting. But don’t put it off. Requiring the employee to wait will add to his or her frustration.

When you do have time to talk, ask questions and listen. The underlying concern you need to address might not be pay-related or might only be partly related to salary. Knapp said frustrated employees will sometimes ask for a raise because it’s a concrete thing to talk about.

“But while money is important, it’s not everything,” Knapp said. “You have to understand what is it that truly motivates that person.”

Consider whether the employee needs a new challenge (one that might come with a pay raise or even one that doesn’t), a new manager or more time off. Is the underlying problem related to the culture at your organization? Does this employee feel valued?

If you can’t fully meet the employee’s salary expectations, are there other ways to adjust the position or benefits to accommodate the concerns?

“You might be able to give and take in other areas about work-life balance or vacation or working conditions or other non-monetary things that are also important,” Knapp said.

2. Do your research.

In the best-case scenario, you already understand the marketplace and know what kind of compensation package your competitors are offering. If you don’t, it’s time to do some research—and assume your employee has already done it, too.

Figure out what jobs are open in your market, what those organizations are paying and how your benefits package stacks up. And find out how your department’s salaries stack up to those in other parts of your own organization. Review your department’s budget with your direct supervisor and go over your options with a human resources professional to determine whether you have any flexibility.

Finally, review the employee’s work history and recent performance. It’s important to be as objective as possible about this individual’s value to the organization.

3. Think holistically.

Every decision about one employee’s compensation impacts the compensation of other employees, whether or not the other workers learn the numbers. And it’s easy when addressing pay in one-off situations for the balance among employees to get out of whack.

“It’s rare that giving the raise is entirely up to you—and there are a hundred things you have to account for. With a decision like this, there are always ripple effects,” Karen Dillon, author of the “HBR Guide to Office Politics,” said in an article for Harvard Business Review.

As you’re doing research, consider whether the pay scale for your entire department is off. Are your employees underpaid in relation to the marketplace? Are the benefits your organization is offering competitive? If the answer to either or both is no, you likely have a larger problem you’ll need to discuss with your manager and HR. If you don’t, you’ll soon be having a string of compensation conversations or you’ll start losing your best employees to your competitors.

“And once turnover rises, there’s a huge cost to turnover—training new employees, the hiring process, just the loss of knowledge,” Knapp said. “So sometimes, to prevent that, you have to play catch-up and … have a big budget increase to keep up with the market.”

4. Be transparent and direct.

It’s likely your organization has policies and procedures related to compensation (and if not, it’s probably time to create some). Be prepared to explain those policies, which could help manage expectations and provide clarity about how salaries are set.

But don’t make excuses or push the blame for a lack of raise elsewhere. That undermines your authority as a manager.

“If a raise isn’t feasible at the moment, communicate this honestly,” said Geraldine Hor, a recruiting associate director for Robert Half, in a guide published by the accounting and finance staffing firm. “Explain the company’s compensation structure, industry benchmarks, and/or factors that influence pay decisions. This helps employees understand the rationale behind your response and fosters trust in the process.”

Then create a road map to help the employee see how to earn a raise in the future, Hor said.

Make sure to document the conversation, provide your employee with a written summary of what you’ve decided and follow up on any goals or pledges you’ve made. If a compensation decision is postponed, make sure to put a process in place to address the request at another time.

5. Be empathetic.

Whether or not these conversations lead to a raise for your employee, be empathetic to his or her situation and aware that the tone of the negotiation will impact the worker’s relationship with you and the company moving forward.

“It’s about how you treat people, how you manage people personally,” Knapp said. “I’m a big believer in servant leadership, where you really try to support [employees] in every way that you can. That’s your primary focus.”•