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I am working in a consulting company, where the company mostly does IT support. The website is also only focused on IT support, and we do not therefore capture leads for the Web Department. We aim for small business, which needs new computers and firewalls.

We were having a performance conversation and talked about salary and my employer told that he was not impressed by the revenue I was generating. I told him that I did not have enough work and I would like to get more tasks and projects so that I could reach my goals, but that I did not think it was my fault that there was not enough work. He said that it was not his fault either, but he could not pay me more.

Is he right that I should not get paid more just because my employer can not get enough web projects, or should I be paid what I am worth not based on the work amount the sales team generates?

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If you're not happy with your salary and your boss won't increase it, find a better job. It's what I did and my new job is much better :) –  Minthos Dec 13 '12 at 23:05
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Pay typically has little-to-nothing to do with the amount of real work a person does. This is just a boss looking to pay you less. Treat it as a sign that you should be updating your resume. –  DA. Dec 14 '12 at 0:23
    
Is the company in a financial position to pay you that much more? That would be the question I'd have as I don't think it makes sense to try to pay you more if that causes the company to go under. –  JB King Dec 16 '12 at 23:32
    
You should get paid whatever wage you agreed to work for. The success (or lack thereof) of the company, the companies ability to give you projects, the car your boss drives...none of that really matters. If you aren't happy with your current agreement, the only thing that really matters is your ability to reach a new one. –  Rob P. Dec 17 '12 at 17:49
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Entire divisions get let go because their product/service is an under performer. Let's not be naive. –  JeffO Dec 17 '12 at 22:10
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11 Answers

up vote 7 down vote accepted

In some ways this is a complex situation, and its hard to get to get through to the "wrong/right" of it (in a legal/moral sense) because it seems that you and your employer have different perceptions of the situation.

" was not impressed by the revenue I was generating."

"..reach my goals..", ".my fault.."

To me, this suggests:

  • there is a revenue metric which you are being measured against
  • you are seen by your employer as being responsible for that revenue
  • you have accepted that you are responsible for these goals

If the revenue target (or perhaps a billable hours target) hadn't been formally set for you at the start of the year, then by using the phase "my goal" and saying it wasn't your fault, you have still positioned yourself as accountable.

Whether this is "right/wrong" depends on whether it was formal goal or not; if this was one of your key performance indicators (KPIs) then your employer can easily tie your pay to your revenue generation performance.

If this was never formally set as a goal for you, then while you may have the "legal" right (in that you are being judged against a performance metric that was never formally set) this is only useful if you intend to either leave or take legal action. I say this because in a "win-lose" (or "right-wrong") battle with management, even if you win it can be very hard to rebuild an effective relationship afterwards.

While you current question is posed as looking for validation of your point of view (and hence is gathering close votes) I would suggest that if you want to remain with this employer you need to find a win-win outcome.

You manager has the perception that you are accountable, and in your response you have, in their eyes, accepted accountability by trying to explain away the lack of success.

Rather than change this perception, you could use this as a the starting point to take more ownership of the part of the business you operate in. I would suggest you put together a simple, bullet point plan on what you intend to do, and discuss this with you manager, requesting feedback.

Some key points might be:

  • stop working on things you are not going to be judged on in terms of performance
  • create a list of the 4-5 key features that your service provides
  • identify the key benefit of each feature (reduce risk, make money, save money)
  • work with the sales team to find where they encounter resistance and why
  • use this to draw up a "FAQ" sheet that resolves these questions
  • identify any unique synergies your combined services offers
  • create a "service selling" sheet for your sales force
  • make sure this is replicated on the website
  • identify any trainign needs you have (sales trainign etc.)

Note, you don't have to actually do any of these things, but simply approach your manager for advice on making this work.

The goal here is to indicate that if you are to be accountable for growing this side of the business, then you need help, support and funding to do so.

If they push back on this, then you are in a position to argue that your pay is being held down as a result of other people in the organisation failing, and ask how management intends to resolve this.

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Thank you, that is some really nice advices. –  Kevindish Dec 26 '12 at 11:20
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There are two sides to the coin. From the business perspective, it doesn't make sense to pay more if they can't find enough work for you to do. From your perspective, your value is independent of how well your employer can attract appropriate clients. So, in some sense, you're both right.

In practice, what this means is often that your employer can't afford to have a full time web developer. That means that you would need to find a new job at a company that can afford to pay you what you're worth. And it means that your employer would need to find a cheaper employee, probably one that can do a bit of development but that can also do the IT support that the company is built around. Of course, your employer might decide to dedicate the resources to marketing to attract more web development clients. Or you might decide that there are other aspects to this job that make it worthwhile for you to accept below-market wages. But an amicable separation is the most common result.

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I hate to break this to you, but, salary does not really correlate with work output very well in the real world. While exceptions exist, most companies do not operate in such a way that if you produce 2x as much you receive 2x the salary (if you even have any salary difference at all).

If you believe salary is directly related to employee value you have a completely flawed view of how salaries within companies work.

Is he right that I should not get paid more just because my employer can not get enough web projects,

Your salary is going to be whatever you and the company agree on. If you are willing to work for less, then the company has no real incentive to increase your pay - they are effectively going to be giving away money if they decide to pay you more.

The flip side is that if you are not happy with your pay, you can look elsewhere for a job which is more appropriately compensating you.

You don't mention any sort of information about your salary other than, "I want more money" - make sure you've researched the market rate for your position and qualifications before automatically assuming you are underpaid. It is far more compelling to approach this subject from the, "I've done a lot of research and found that the regional average for my position is $XXk a year, but I'm currently making less - is there anything we can do to get my salary closer?" Unfortunately, you somewhat sound like you've burned that bridge already - asking "I want more money ok?"

or should I be paid what I am worth not based on the work amount the sales team generates?

If you work for a company which sells a product, your salary is based on this. It doesn't matter what size the company is - without sales of some sort no one gets paid. Whether the company is 10 people or 100,000.


What you should do in this situation (assuming you do NOT want to leave the company) is something like:

  1. Have a conversation with your boss, "What can I do over the next 3-6 months in terms of additional responsibilities which would be reflected in an increase in pay?" Better yet, have a list of specific additional things you can do before this meeting and suggest them. Perhaps even have a printed 1-page summary you and your boss can go over.
  2. Do these and check in with your boss as you complete them. Make sure your boss knows you are accomplishing the additional responsibilities successfully.
  3. In a few months (3-6 probably) talk with your boss after having performed the responsibilities. This conversation should not be a surprise, after all, you initiated the "raise" conversation and determined what steps needed to happen for this, and have now done them. You've communicated them, executed, and now are looking for the followup.

If you don't think this is likely and really want that increase in salary, you are likely going to have to look elsewhere.

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Salary is another word for 'your worth to the company'

Your worth to the company is based on many things

a) The money they are making from putting you on billable projects to their clients

b) The relationships you help to build with the clients, a good relationship between the two companies helps with repeat sales which is evidently good for the company.

c) The knowledge you have, be it general or specific. Let me expand on that point for a minute, if you have a large amount of internal knowledge of the systems, their processes and the general flow of a lot of the applications that other people dont have, you are worth much more to the company. Additionally having other skills perhaps in languages they dont yet use isnt an bvious advantage, until they want to expand into that area and low and behold guess who has the skills to open those doors. You.

Salary is how much the company thinks you are worth to them, and how much they are willing to pay to keep your knowledge, expertise and skills. If they can't find work for them that is their problem, your knowledge doesnt suddenly dissappear because you finish a project.

If a company is struggling to find you more work however, i would worry about job security and would hone up interviewing skills

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Also it is most likely worth something to them that you are available to them at a moments notice every day as opposed to having to hire a contractor when needed. –  Thorbjørn Ravn Andersen Feb 21 '13 at 14:54
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Salary should not be governed by available work, but hours paid for should be. Your situation suggests (to me at least) that your role might be better suited to a part-time employee than a full-time one.

It is always difficult to argue for salary increases without proof of your utility (and the value the company would lose if you left), which may be difficult if you are only able to work say 50% of the time.

Is there anything you can do to add greater value to the projects you are working on? Even if you are unable to go to your manager with proof of increased revenue, a few glowing customer testimonials will always help in negotiations.

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Thank you, i really appreciate you answer. Yes, i really try. I am working on our company site, i maintain our Adwords, makes numours approvements to our intranet/workflow, startet a company blog where i post about IT, createt a landingpage for our best selling product, but when i said that i did not feel appreciatet/compensated for the amount of internal work, he said that it was just the way it was. –  Kevindish Dec 14 '12 at 11:40
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Your salary reflects precisely what you and your employer mutually agree upon. And of course, the amount you both agree to will be a reflection of how much work there is to do.

If there is not enough work, the value you provide to the company is lessened. It's not your fault--but it's true. What value does anyone provide if they're twiddling their thumbs?

Obviously, the opposite is true as well. The more work you complete, the greater value you provide to the company. Not to mention the simple fact that they'll have more money to pay you.

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From the companies perspective, salary should be based on two things, the value of the work and how hard it is to find someone able to do it.

The work doesn't have to be income generating to be valuable, maintaining operations and administration functions are valuable. It does have to be necessary. Optional services are simply skipped if they cost too much.

Sounds like part of what you do is optional, useful but nonessential. If that's the case, there's an upper limit on what they can and will pay you for doing it, not matter how easy or hard it is to do.

Effort does not equal pay.

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It has nothing to do with "fair" or whose fault it is. Salary is a function of several factors; mainly:

  • How much money you make for the company
  • How much money you are willing to work for
  • How many other people are capable of doing your job
  • How good each of you (the company and you) are at negotiating salary.

For example, let's say a company has a job that will make it a profit of $1000 a week. No matter how good you are at your job, they aren't going to pay you more than that. So that is the upper range of your salary.

It isn't worth the time and gas money to drive to work for you for less than $100 a week, so that is the lower range of your salary.

Where your actual salary ends up being within that range depends on how many other people are capable and willing to do the job and how well you negotiate.

If you are one of a very small group of people capable of doing the job and are not an idiot when it comes to negotiation, you will make closer to the $1000.

If there are tons of people who can do the job, then you are going to make closer to the $100.

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It seems that your problem (from your employers prospective) is that you are not producing enough from the work that you do have... Not that you do not have enough work to do.

Your employer has a cost per contact/ rate of return that he is expecting from each customer contact. If you ratio is not high enough then giving you more customers is going to cost them money especially if they have agents that are meeting the return rate.

If I expect 50% customer conversion rate and you have 60 customer contacts and have a return of 10 then increasing you to 180 contacts is not going to get you to a 50% return even if you maintain a linear return rate.

They want a return rate from you. If you can not get that rate then you may be costing more money then you provide in revenue. Even if you are breaking even that is not what they are looking for. Business men exist to make money not provide you with a job. That is just your benefit of their being in business. You must perform at or above expectations if you expect and increase in pay.

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A company exists to make a profit or to accomplish a mission as efficiently as possible. I'm willing to bet that being a consultanting company your company's mission is more profit-oriented and less goal oriented. In most consultant jobs I've seen, the company will not make a decision that makes it unprofitable, and in any case where they take a risk of no-profit, it's with a very deliberate aim to grow the business.

It sounds to me like what your boss is saying is "paying you more money would not make a profit for us" and "we have no goals to strategically grow your job function so that you are more profitable". Also, if your company at all smart, they've weighed the impact and likelihood of you quitting vs. the cost of paying you more. The projected costs associated with loosing you and retraining someone else to do what you do (or the cost of loosing the profits you currently generate) are factored in here.

Sadly, that's business and it's their decision.

Your decision is not really whether the company is making a good or bad business decision, or being fair or unfair - but whether you want to continue with the status quo or try something else.

I'd offer that there's essentially three options here:

1 - Keep the status quo

Decide you like the general situation well enough to stick around and hope the company's business improves in your area. It's a good idea if you don't have many other opportunities in your local area that are as good as what you've got.

2 - Grow the business

Even in a technical field, the demarcation between a regular employee and a very senior, high caliber employee is their knowledge of and ownership in the business goals of the company. Different businesses can be easier or harder to comprehend and contribute to - so it's worth having a conversation with your boss on "how can I help grow my speciality in this business so that I do generate more profit?"

Ideas might include:

  • asking to contribute text to the website
  • working with regular IT consultants so that your expertise is bundled in as a value add to other jobs giving you an up-sell.
  • working with regular IT consultants to grow into areas of consulting where having you on staff is a crticial asset
  • working with anyone who sells your services, or learning better how to sell your services so that you get more work

Is this, strictly speaking, your job? No. But if you want to rise within the company, and you want more money, take on the work.

3 - Find a new job

The tradeoff will be different from company to company. All this is business specific - find another business with a more urgent and profitable need for your skills, and it's likely that you'll also find a better salary.

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Your salary/wage rate is nothing more or less than what the company is currently willing to pay you for your time. No more, no less.

For 90% of us, our actual salary and benefits are much less than the actual financial value we provide to the company. An ex-coworker of mine, while he was a co-worker, was working within the accounting system software, and "found" $150,000 of accounts receivable that we never billed and was collectible. He got a $1000 bonus as part of our "attaboy" recognition system; the owners split the rest of the windfall. That's business; you pay money in, you get money out. Those of us who work for wages or salary see much less "profit-sharing"; the ostensible tradeoff is that we're guaranteed a return for the work we put in, while investors may see no gain or even lose money.

Case in point: you get a certain salary for your job. You received the full salary last year, regardless of how much or little revenue you were generating on the other end. Your boss probably has his own goals to meet for the entire department, and a budget to boot. He may have missed those goals, or just barely eked out, and/or he may be at his budget limit. You, frankly, don't get access to the details as a working Joe; they aren't your problems to deal with (though you obviously can see the end result). Whether it's anyone's fault or not, the fact remains that your boss was unable or unwilling to give you a raise, at least until revenue picks up and he can renegotiate budget numbers with his own boss. You have your own decision; can you accept that salary, or can you not? The actions to take are obvious.

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