We are a small company, and have an employee working with us for about 11 years now. She joined at a salary of about Rs 4500 and now she's drawing a salary of about Rs 27,500 + PF. We are a small organization. We have always given her maximum raise of about 20% as per our company policy and on many occasions even more this. She's an honest and dedicated employee, though not a star performer as far as technically her work is concerned. But she performs her duties well, and has high integrity. I wanted to ask you that since she has always been given maximum increment of about 20% on her gross. She might expect the same increment this time also which will be an amount of Rs 5500.
But then there is a limit to how much increment our company can always give. When her salary was low we always kept her giving increment between Rs 3500-5000 Rs. I mean if we give the same increment this time also then her salary would reach around Rs 33,000 but we can give an increment of about Rs 4,000 which is not bad, and will make her salary Rs 31,500. So my question is that what rationale can be given to her for not giving 20% but may be 18% increment because this is what the company can afford right now. Moreover, she is someone who will be permanent, or will remain for a long time with the company. If we keep giving her 20% increment always, then at a point we may not be able to afford that amount of salary as our company is small with a lesser turnover.
What do you think should be done in this scenario? As the amount of salary increases, does the increment percentage also remain the same?
Please give your suggestions as soon as possible. Thanks.
From India, Faridabad
Acknowledge(0)
Amend(0)
8But then there is a limit to how much increment our company can always give. When her salary was low we always kept her giving increment between Rs 3500-5000 Rs. I mean if we give the same increment this time also then her salary would reach around Rs 33,000 but we can give an increment of about Rs 4,000 which is not bad, and will make her salary Rs 31,500. So my question is that what rationale can be given to her for not giving 20% but may be 18% increment because this is what the company can afford right now. Moreover, she is someone who will be permanent, or will remain for a long time with the company. If we keep giving her 20% increment always, then at a point we may not be able to afford that amount of salary as our company is small with a lesser turnover.
What do you think should be done in this scenario? As the amount of salary increases, does the increment percentage also remain the same?
Please give your suggestions as soon as possible. Thanks.
From India, Faridabad
Acknowledge(0)Amend(0)
you may need to introduce salary scales for various levels. after certain levels money may not be the only motivator. So why don’t you try career advancement, performance linked pay etc
From India, Bangalore
Acknowledge(0)Amend(0)
From India, Bangalore
Acknowledge(0)Amend(0)
Thank you for your reply. However, who is to decide what these salary scales should be? Our company is diverse, with different divisions. Could you please specify some of these options? Do you mean it is not important to give a monetary increment every year? Thank you for your assistance again.
From India, Faridabad
Acknowledge(0)Amend(0)
0
0
From India, Faridabad
Acknowledge(0)Amend(0)CiteHR.AI
(Fact Checked)-The determination of salary scales is typically the responsibility of the employer, taking into account factors like performance, market rates, and company financials. Providing monetary increments annually is important for motivation and retention. Different options for structuring increments can be based on performance evaluations, market benchmarks, and budget considerations. It is essential to balance fairness with the company's financial capacity. Thank you for your inquiry. (1 Acknowledge point)
0
0
CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Salary & Compensation Guidelines.zip
Salary Increment.pps
CiteHR.AI
(Fact Checked)-The user's reply is correct. Introducing salary scales, career advancement, and performance-linked pay can be effective beyond just monetary incentives. (1 Acknowledge point)