I own a small electrical company and have been blessed with LOTS of work. Almost too busy. With the three employees and myself we are barely keeping up with the demand. One of my workers is asking for an early raise which he is scheduled to receive in a couple months. I told him I'd think about it. About a week goes by and he says that another company contacted him and he says they offered him what he was asking for. At first I was pissed that he should put me in this position but need some advice on how to handle this.
Do you find your employee an efficient worker? Is he performing well in your business? What could be the lost in your business if he leaves? You mention that you are barely keeping up with the demands, so is it possible to hire more employees, if he leaves? These are some of the things you can think about to trigger your decision. It is important to keep the employee happy if they are giving you great performances, but it is also important to measure the benefits you can offer to the benefits of your business.
I can understand your feelings when your employee address the early salary raise issue to you. If this employee is doing a great job, I believe you know that he deserves to get a raise, and it could also be a motivation for the other employees to work harder. On the other hand, if an employee is not performing efficiently, you should consider putting your focus on another that do.
If you need more support regarding the issue, I will be happy to help you sort things out. Best of luck!
First, I'm glad your employee feels comfortable enough to ask; most folks are too scared to even pose the question.
I think this is an opportunity to show your true leadership skills and probe: there may be an underlying problem that you don't know about but he might want to share and you could help.
I've run businesses, created startups and done turnarounds for over 30 years. I like people and I think businesses are great places for people to learn and grow.
So, why not ask..."Hi, Jim, about that early raise...right now, I don't see a problem but may I ask what's going on that prompts this need? Perhaps, there's a better way to solve a problem and I'd feel good about helping you." Get him to open up and listen.
Once you've heard what needs to be said, you might creatively go about solving the problem that needs fixing. As I said, this is a great opportunity.
And, if he's shopping around for the "right" pay grade, maybe there's something missing for him in the job. Find out what it is.
Electrical company? Supplies or are you doing electrical work?
Call or write for clarifications.
However you choose to handle the situation, consider your response carefully. Yes, consider his contribution to the organization. Is the raise deserving? How are raises determined in your organization? Is this something you need to consider changing? Are you comfortable making an exception? Are you willing to make an exception for the next person that asks?
No employee is irreplaceable. Bottomline, an employee is trying to force your hand. In my experience, counteroffers rarely work. If an employee is already considering leaving, this is likely what he will do at some point, even if he accepts your counter now.
Even though you might not like the fact that this employee has been shopping around it appears that there's a demand for his/her skills. That makes me wonder how hard it would be for you to replace this person.
Whilst making your decision you need to consider the following:
- Am I happy/satisfied with this worker as an employee, professional and person?
- How hard would it be to replace this person (calculate the time required for recruitment, induction, training and of course the fact that you'll probably have to say no to potential customers on the short term)
Based on these elements you'll likely find that it will make your life a lot easier to indeed give the raise. But perhaps you can create some additional conditions like increasing responsibility to bring in more sales, or coaching/training future new employees to balance out the higher pay.
Good luck and you know where to find me if you've got more questions!