Why you shouldn't have to ask for a pay rise
Updated: Apr 28
Next week there’s a webinar from Business Chicks with Rhonda Brighton-Hall that I think will be AWESOME for all you ladies out there to help you to get paid what you’re truly worth.
And it was a timely reminder of my philosophy on pay rises (after all, we are in the limbo between companies’ End of Financial Year and their salary increase period). I believe companies should ALWAYS give their staff a pay rise each year WITHOUT you having to ask for it.
Something for nothing?
The cost of living (measured by Consumer Price Index or CPI) goes up each year. So if your pay doesn’t, you are doing the same work for less value. Take the humble chocolate bar. If it goes up by 5c but your pay doesn’t, that is less chocolate you can buy. Multiply that 5c by the sheer volume of goods and services you buy, and the 1-3% average increase of CPI makes a huge difference to an individual’s household expenses over the course of the year.
To me, companies should provide their people with a pay increase that, at a minimum, meets CPI… regardless of staff performance or request. Companies who increase the cost of their goods and services and don't pass on the CPI salary increase are pocketing the difference, and it’s their staff who lose out. And if you’re a company who is not increasing the cost of its goods and services with CPI, that is your business pricing issue and shouldn’t be your staff’s job to burden. Set the expectation with your customers or clients that you will be increasing prices by at least CPI each year - model off the masters (like private health insurance providers)!
Ask and you shall receive
What does this mean for you as an employee? Anything over and above CPI does depend on your courage and confidence to ask for it. And any pay rise you do ask for should therefore always be calculated over and above CPI for that year.
If CPI is 1.8%, you should be asking for at least 2.8% (which sounds like it’s close to 3% but would still only give you an actual pay rise of 1%!!).
Something like 5% sounds more desirable - the actual pay rise would be just over 3%.
And what if they say no?
As I suggest to my clients - if they don’t give it to you, there is one question you need to ask yourself:
“Can I continue to work for a company that doesn’t value me?”
Employees who stay longer than 2 years in a company may get paid 50% less, because they often only increase by a small percentage of their current salary instead of being re-calibrated against the broader market. It’s no secret that I tripled my income in 3 years by moving organisations (as well as diversified my experience to boot working across 3 different industries!). But the psychological toll of knowing that your boss doesn’t value you, or your work, will hurt more than your hip pocket, and energetically over time may impact your own self-worth.
There’s a reason I’m a Career Change Coach. Yes, I help teams find their feet and find their futures during restructures, especially when their jobs are impacted by automation. But I’m also passionate about simply increasing the awareness and confidence people have about their own careers, including their salaries. It’s not your company’s job to give you handouts. It’s your job to figure out what you want, what you’re worth, and go after it.
I'm Lata Hamilton - Change Leadership and Confidence expert, Founder & CEO of Passion Pioneers, and the creator of the Leading Successful Change program.
If you'd like my script for negotiating a pay rise, grab my free Underpaid & Overlooked Coaching Action Guide to learn how to build the confidence to earn your worth - download it here.