How to Deal with Higher Compensation Demands


HR Insights for ProfessionalsThe latest thought leadership for HR pros

Thursday, August 1, 2019

One of the biggest challenges that every HR department faces is dealing with compensation demands from employees. Pay is no doubt a sensitive area for many, so what steps should you take to deal with higher compensation demands from your workforce?

Infographic 4 Minutes
How to Deal with Higher Compensation Demands

Pay is a sensitive area for both employees and employers, but with huge corporations like Amazon, generating a record $1.9 billion, it’s no surprise that HR is seeing a growing demand for increased monetary compensation. However, meeting these demands can be problematic.

As much as you’d like to be seen as the good guy, sometimes raising a salary isn’t the most viable option, and if a compensation demand is handled poorly, it could result in high staff turnover and poor team morale – thus affecting overall productivity. With the popularity of websites like Glassdoor, where current and former employees can anonymously review companies, poor management of compensation demands could severely impact your employer brand, which might negatively impact future attempts to hire great talent.

Learn more: How to Decline a Pay Rise Without Crushing Their Spirit

If employees feel they deserve a salary rise, HR managers need to see justifications, and compare pay across the company – a pay rise for one individual might seem unfair to another. It’s no secret that most employees desire a pay rise, but there are other alternatives which are just as effective, such as flexible working, further education or pension schemes – all of which can help to reduce staff turnover.

There’s no doubt that employees will always demand higher compensation, so how do you manage this? Follow our 4 steps outlined in the infographic below.

IFP provides four practical steps on how to deal with higher compensation demand

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