Asking for a raise during a company's difficult time

Question

My company is currently suffering the effect of the crisis, which hit Europe a couples of years ago. Sales dropped, the company went through two big reorganizations, and for two consecutive years it made not enough revenues to actually gain money. It is safe to say that we are in a loss condition.

Generale raises in accordance with what the workers' associations said were shifted by 6 months, and the yearly evaluations of performances (which in my case were always positive -> resulted in a little raise) were delayed too.

During the latest general company meetings, they made projections that would put the company in a very good position by 2018 (lots of revenues).

I wonder if it is acceptable to ask for a raise during these times, and if there is a "sensitive" way to do that. I understand that I am a part of the company too, but I still think that my job is at the moment underpaid.

Answer 1

You can always ask for a raise, but it might not go over well when a company is losing money.

As MSalters notes, your value to the company is set by the market, and this isn't dependent on whether your employer is losing money. In theory, they should assess your value in largely the same way, regardless of their profit margin. If you are valuable, then they stand to lose if you leave--even if they are already losing money.

However, in practice, it's not so simple. Companies in crisis don't always act logically, and there also might be other things that going on that you don't know about.

• General company policies like a pay freeze might be in effect, making it hard to enact a raise.
• If things are really bad, decisions may be driven by short-term thinking (such as trying to stay solvent) that make your long-term value less relevant.
• There may be plans such as a merger in the works, which might completely change these calculations.
• The company might want to shed staff, and thus would not mind if you decide to leave.

Given that your company is doing illogical things like suspending evaluation of employee performance, I think it's quite likely that you will face some barriers to getting a raise.

In addition, you face some reputational risk if you ask for a raise in this scenario:

• Other workers (such as your boss) might feel they are making sacrifices and resent the fact that you are not willing to.
• The possibility of being perceived as selfish/greedy by too aggressively asking for a raise is increased in this environment.

My advice is to be cautious. I wouldn't completely rule out requesting a pay raise, but making this request now is a bit riskier than usual, and probably less likely to be successful.

The recent good projections give you a reasonable cause to at least ask. But still, the fact that normal raises have yet to resume mean some of the above conditions are likely to apply.

Answer 2

The labor market is a market. There are multiple suppliers and customers. Prices vary as supply and demand change. Can you expect a higher price if there's an oversupply? Not realistically.

But we can't answer this question specifically for you without knowing what your circumstances are. You'll have to figure out your relevant market. In particular, what could you make elsewhere? It's reasonable to ask a similar number internally, even if your company would be losing money.

Answer 3

I'd at least consider doing something along the lines of this:

Call a meeting with your boss and make him/her aware it is about your pay and your performance. Don't forget that last bit, "performance" - it is a key.

In this meeting you will, to the best of your abilities, explain how you enjoy your work and teammates (even if you don't) but feel unappreciated because as you see it your salary is what a person less able would get. Don't get testy, angry, sad, or more importantly appear arrogant. Talk about facts first, then feelings. Many would say that how you feel is irrelevant, but au contraire - they are probably the only thing your boss can not argue against.

Now, had your company been in a good position, this would be the end of my advice. It is clearly not. Time to take initiative. Before your boss gets all on the defensive (you have to stop before you are finished if he/she is getting visibly annoyed...) do the pivot. Now say that you fully understand the situation the company and the boss is in at the moment. Empathize with tough decisions and be impressed with how your boss is still managing to motivate people. Ask, as humbly as possible what your manager can do for your salary. If he is at all empathizing with your situation you should be getting somewhere by now, bona fide excuses at the least. Take the initiative in offering to sacrifice current salary for future salary. Lay up a future plan (prepared in advance) with generous raises for 2018-2019-2020 to accomodate for a much diminished 2017. Tell your boss that the promise of pay will at least help you feel valuable and secure. Hope for a successful combination of facts, feelings, humility and self sacrifice, and do not forget GET IT IN WRITING.

That is what I would have attempted.

Answer 4

You can feel the water out by phrasing the question diffently.

Something like

Now that the forecasts are improving when will we be getting pay rises.

By using the word "when" you are stating, obviously that a hiatus on pay rises can't be justified forever. Inflation happens, your skills improve, other companies would pay more for the same skills.

By saying "we" you are not making it personal or greedy, you are merely asking after the welfare of the whole staff.

You could get a flat denial that it will be happening, in which case you can not hold out much help for yourself.

You could get some fluff, in which case also don't hold out much hope.

It is possible also you get a specific date, or at least some concrete information which would help you on deciding if you will get your needs met any time soon.