A colleague of mine who is a credit professional at a mid-sized beverage wholesale distribution company was recently asking me for some advice about requesting a raise from his employer. He felt that since his job duties were considerably increased during the pandemic, he should be reasonably compensated and was wondering how to go about the request process. Having been in his position myself at times during my career and under similar circumstances, following below are what I asked him so as to understand if a raise was a possibility.
Can the company afford to give him a raise? – Although the economy is making a comeback with some industries doing even better now than before the pandemic, other industries have taken such a hit that the recovery, if any, may be years away. Since my colleague works in the beverage industry (wine, beer, and spirits), I’d venture to say that in good or bad times, consumers are still indulging themselves. The question however is, “What is the current financial status of his company?” If they are on the upswing, then at least a request at this time doesn’t seem unreasonable. Conversely, regardless of the industry, if the company is still having financial difficulties to the extent that all salaries have been frozen and employees still haven’t come back to work, then in my view it would be a very inopportune time to make a salary increase request.
What exactly did he do to deserve a raise? – According to my colleague, although his position title did not change, his position duties now incorporate several accounting functions. In particular, he is in charge of cash flow forecasting. This has involved working closely with sales, operations, and accounts payables to produce an estimate of his company’s short term cash flow needs. Prior to the pandemic my colleague was usually putting in 40-50 hours per week but once his duties greatly expanded, he added another 15 hours to that workload.
At the same time, he began working from home which has not only allowed him to save 10 hours per week on commutation time, but also provided him additional family time and a flexible work schedule. Perhaps one might be inclined to consider that the additional responsibilities did not significantly add to the overall time devoted to work.
How much of an increase is being requested? – Assuming that the company is in a financially stable position and my colleague has performed admirably with the expanded level of responsibility, how much to request is truly the million-dollar question. My colleague feels that at least a 20% increase is appropriate. From my vantage point, I could not agree or disagree and recommended that he talk with his human resources manager or others that he can confide in at his company to get their advice. Many organizations have an established pattern and policy, and it is best to understand what could be acceptable under the given circumstances within the company’s salary increase policy. Furthermore, I advised my colleague to try and quantify how the extra work he is doing is producing specific measurable results. This is usually the most persuasive part of why an increase in salary is justified.
Can the company find someone else to do his job? Even in good times, understanding when and how much to request can turn into an unexpected situation and backfire. All of a sudden the executive team may feel that the position could be filled more cost effectively. It’s not too often this happens but if my colleague were to come off as too demanding or conveying an attitude of entitlement, then the request could be his undoing. Requesting respectfully is certainly key to navigating a salary increase.
As the economy continues its path of recovery leaving many new structural changes to the positions and duties of credit managers, a prudent and well thought out approach to requesting changes in one’s salary and benefits is imperative.
Your thoughts and comments (nseiverd@cmiweb.com) are most welcome!
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