Asking for a raise?

[dragonwalker]

I’ve been working for my current company now for about 4.5 years. When I first started I worked in a back office support unit, did well received a promotion after 1.5 years and then another one 1.5 years later into my current role.

I am currently a Business Analyst and the role is a departure from my previous role at this company but related to my experience in banking where I worked at another institution for 8 years and before that I was in college. Our company has pay bands and I was promoted into this position and paid at the 25th percentile of the range of the entire pay band. The company literature has stated that the midpoint of the pay band should represent someone fully capable in their position.
In the time I have been in my position I have taken on tasks well beyond my job description as defined by documentation on my role. I feel that my manager has worked with me to be involved on projects and taken lead on several minor projects when my role calls technically for assisting in those projects. He and I have coordinated on doing this in preparation to eventually move into the next level in the department.

When it came to evaluation time this year for my 1st full year in the department I was a bit surprised that I got a 3 out of 5 which is equivalent to “meets expectation”. There was nothing in the evaluation that mentioned anything wrong or mistakes, it was filled with my accomplishments and the next steps to do to go onto future roles. I spoke to my manager about the rating, but it held in the end. I had received a 4 out of 5 or “exceeds expectations” like I have every year before but this was the first full year I was being evaluated in the department. Technically this rating does affect a yearly merit increase that we get.

I had already felt my pay which is $66K was quite low. Outside market sources appear to indicate the going rate for my level of experience is at least $75K. My company is a credit union but with recent news about some high profile banking failures and the industry being on edge I have already been told this year there really isn’t a budget for promotion. The company itself claims to be doing well. 

I really feel like I should ask however the less than stellar evaluation, and industry difficulties make me question if I should even asking. Last year based on a higher rating and supposed inflation adjust bump I got 4.25%, with the rating this year I am thinking I will probably get 3.25% however I am considering asking for the midpoint at around $74K which would be a 12% jump which is nearly double what I got even from a promotion and I know I won’t get but I wanted to give plenty of room for them to go down. I’m really just hoping to get $70K which is about $2K more than I’m estimating I will get.

Under the circumstances should I even ask? I don’t want to seem ungrateful because the company is helping to pay for my graduate schooling and sending me through a company leadership program however that is not directly out of the budget for promotions and merit increases. I have never asked for a raise at this company before.   

[Wolfpack Mustachian]

Anything could happen, but your request is well reasoned. Even at "meets," if the rating is valid, you're meeting the expectations of your job but at a lower percentage of your pay band.

If you provide them with all of this information in a professional manner, and it goes poorly, that's a reflection on them and possibly an indication that this is not the company for you. By poorly, I mean they get upset about the request. They could certainly say no without issues, but then, there's no harm.

[Freedomin5]

I have never had luck asking for a raise…without a competing job offer in hand. If the company values your contribution and is worried about losing you, they may be more amenable to granting a raise in order to keep you. I’d start putting out feelers, quietly, if only to give you a bargaining chip. It also provides external validation of your worth (in terms of salary, not as a person) which puts you in a stronger bargaining position.

[dragonwalker]

Thanks for the feedback. A few things I should mention. The company just had some recent layoffs after not having had any in a very long time in real estate departments due to the recent rise in rates and slowdown in RE production. This is not a department that I am tied to.

Coincidentally, our CEO had a company wide meeting to address recent concerns in the banking industry and to reassure everyone of our own financial strength. The tone was positive but tightening of operating expenses was specifically addressed as well as a much more granular look at future hiring. It was mentioned that there isn't a hiring freeze but the message was that further hiring would be much more carefully scrutinized. Nothing was mentioned about raises or promotions.

In light of this information would timing my request at this time before our annual merit increases be prudent? I think if anything it gives an easy out for management to move away from granting a request. I'm not sure if this thinking is right but I wanted to be somewhat careful when asking for a raise since if I'm denied there would be a period of perhaps 1+ year before considering asking again to see how things have changed and not to be perceived as focused just on the raise.

However, it's also possible at a future date that we might be in a recession and the company might even have a greater reason not to. I believe the request even if supported by my immediate management would require CEO approval so I am even more pessimistic about the possibility.   

[GuitarStv]

Thanks for the feedback. A few things I should mention. The company just had some recent layoffs after not having had any in a very long time in real estate departments due to the recent rise in rates and slowdown in RE production. This is not a department that I am tied to.

Coincidentally, our CEO had a company wide meeting to address recent concerns in the banking industry and to reassure everyone of our own financial strength. The tone was positive but tightening of operating expenses was specifically addressed as well as a much more granular look at future hiring. It was mentioned that there isn't a hiring freeze but the message was that further hiring would be much more carefully scrutinized. Nothing was mentioned about raises or promotions.

In light of this information would timing my request at this time before our annual merit increases be prudent? I think if anything it gives an easy out for management to move away from granting a request. I'm not sure if this thinking is right but I wanted to be somewhat careful when asking for a raise since if I'm denied there would be a period of perhaps 1+ year before considering asking again to see how things have changed and not to be perceived as focused just on the raise.

However, it's also possible at a future date that we might be in a recession and the company might even have a greater reason not to.

Hard to say.  If there are lots of layoffs in your industry and you can easily be replaced then there will be no motivation for management to keep you.  If they laid off enough to keep a barebones crew going and you're considered essential/hard to replace then they are likely to wiggle a bit.  Is there anyone higher up in management that you know well enough to talk with?

[dragonwalker]

That's an interesting perspective about the layoffs. However in total it was about 1% of the total workforce and was very specific to one working group so I don't think it was a matter of keeping the essentials. Therefore I don't think there is much positive leverage I can conclude getting from that. In theory there is a person at a higher level my manager would speak to that I could speak to first but almost certainly this person would rely on my managers input on the request before going even further so I think my best bet if I tried is to speak to my immediate manager. I also have the best working relationship with my manager and feel this person would be my best advocate. 

[Finances_With_Purpose]

Ramit Sethi writes some good tips for this.

First, go ask your boss what to do in order to earn a raise.  Second, go do those things. 

Third, go back and point out that you've done the things, and that you had talked about what was needed. 

It's a hard ask to turn down.  I've had that approach work for me.  I've also had the job-in-hand approach work, but that can also be dangerous, depending upon your employer and how you frame that. 

All of that said, you are picking a terrible time market-wise for a small bank, so it may not matter much until the next few months shake out and things get a little more back to normal. 

[GilesMM]

I would start interviewing at better employers and see if you can get an offer to either match or take.

[dragonwalker]

The suggestion to interview at other places has come up recently a few times and I agree I should do this to see my worth. I don't think I can reasonably leave as my current employer is helping me pay for school and I'd have to pay back $20k+ but I guess I'll never know until I try. It might give me develop more interview confidence.

[Freedomin5]

Well, if the new job offers you a $30k+ raise, it might make sense to pay back the $20k and then take the new job. Your tuition benefits shouldn’t act as golden handcuffs.

[Newday]

You can also get a good signing bonus to pay some of the costs..

[dragonwalker]

This is certainly true and it's possible but I'm being realistic and it's unlikely. Coincidentally there is a possibility in the nearish 1-2 year term it would make a lot of sense to relocate for personal reasons so even more of a draw to leave even if I had to pay it back.

I am about half way through my program and have about 1 more year to go. My assumption is that the best offers are likely to come after I have obtained my degree but would being within 1 year of finishing have nearly the same weight or is it night and day the offers I may receive? Ofcourse not only is there the benefit of not having to pay back funds if I left later, I would prefer to give my employer a chance to retain me with degree in hand or be accepted into a higher position.

[Sibley]

https://www.askamanager.org/2018/02/the-ask-a-manager-guide-to-asking-for-a-raise.html

This might be helpful as well. Good luck!

[trollwithamustache]

I'd say ask and be OK with them saying no.

Before you ask, do take a good look at the band system and the bands. Salary bands are handcuffs that make stupid companies do stupid things. Can you ask to be upped to the next band based off of experience or something else? You probably need to be in the next band for it to be easy for them to give you more $$$. If you are tapping out your current band or even trending into the top 25% of pay in that band, it's almost "impossible" for them to give you more money.

[dragonwalker]

@Sibley Interesting article, I have seen many of those points and saw some new ones as well. One that stood out was considering What's likely to happen if I [the manager] says no?, ironically I think because my boss knows I'm getting money from the company for school that would have to be paid back if I left it would be very unlikely I would leave. Also, something interesting happened just today. My boss's boss just got promoted and his current position will be open. My current boss is I think the best and most obvious candidate. I'm not sure if this changes the timing if I should ask but I think it's a more favorable situation as they are both in a good mood and hopefully generous.

 @trollwithamustache There is no way I can be in the next pay band without being promoted. I brought the topic of working toward a promotion up very early on in my current position and we have been working toward that goal since then. As far as where I am in the band, I guess the good news is that I'm near the bottom around the first 25th percentile so in theory it should be very easy to justify increasing me. In fact I am more than 10% in my salary away from the 50th percentile. I am absolutely the lowest paid person in the department no doubt.

I have scheduled a face to face meeting with him this coming Monday. I wanted to ask everyone regarding the particular sentence I use to describe how I feel about being underpaid and what you think of it. I think this sentence in particular is most important in the conversation but I feel it could be the most sensitive.

Just getting some thoughts but if after explaining some points of what I have to say and then saying, "I feel financially undervalued with how much I am being paid now." Am I being overly analytical but is that too harsh of a thing to say? I am going to preface this with a discussion of sincere gratefulness for what I have learned, my time at the company, and opportunity coming in. I plan to have information detailing market comparable salaries, what I have done extra above my position. I plan to conclude on the big items underway professionally and developmentally. I am not going to mention anything about leaving if I don't get what I want. I will deliver the message confidently.     

I know my immediate manager will not have the final say but his input will be sought after and he will be the only one I will present my case to. I still view rejection as a very high and most likely possibility but I feel if I don't do it I will regret it and every cent gained has ripple effects for as long as I am in this company. Frankly I will take anything more I can get.

[Wolfpack Mustachian]

I would personally avoid any statements that imply your "feelings" are involved. Your feelings of undervaluation are certainly valid, but feelings are always subjective. I would emphasize the feelings on the good side of things as you said, your feelings of gratitude and other positive things.

For the actually statement, I would try to keep it as factual as possible. Something to the effect of, "Given the information I just presented, I believe that the work I am doing merits more income than I am currently making" or something similar, perhaps less formal. The big thing I see is, present the facts and then conclude with, given all of this, I believe I am being underpaid.

[dragonwalker]

That makes sense and I will make the adjustment to how I deliver the request. In my research on my pay raise I discovered something interesting. I found an internal company documenting the the minimum pay for someone entering any job due to a promotion should be 90% of the midpoint salary. I did some calculating and determined I was made at 89.3% of this number instead. The money amounts to a different of about $500-600 but I'm wondering how should I address this discrepancy in light of my raise request. I plan to bring it up as another example of how I am underpayed however if my raise request is denied should I ask HR directly about this?

[Newday]

I think if you focus on 89.3 vs 90 - you can get that corrected - but you will lose lot of bargaining power ... Focus on what you really want - to increase your salary to what % - and go at it.

Skip the feelings talk and focus on what the current market salary is for your skills/experience/value you add etc. IF you are already doing above and beyond your current role, this is the time to talk about it. Also, do some research on what other colleagues in similar role are being paid - so you get a range on what you should ask for. Ask for the higher end of that range.

[Wolfpack Mustachian]

I think if you focus on 89.3 vs 90 - you can get that corrected - but you will lose lot of bargaining power ... Focus on what you really want - to increase your salary to what % - and go at it.

Skip the feelings talk and focus on what the current market salary is for your skills/experience/value you add etc. IF you are already doing above and beyond your current role, this is the time to talk about it. Also, do some research on what other colleagues in similar role are being paid - so you get a range on what you should ask for. Ask for the higher end of that range.

I very much agree with most of this. The only thing I'd be wary of, depending on where your are geographically, is mentioning colleagues salaries (not that this was recommended by the other poster). Use it as information, but bringing it up could be very problematic.

[dragonwalker]

Ok, so I had the conversation today. I think overall it went well. I stuck as much as possible to the facts, didn't compare, didn't talk about things everyone is going through like inflation. I did bring up some specific numbers calling attention to my compensation relative to where it was in the pay scale. I talked about accomplishments, wanting to do more, being involved, doing extra, working toward the next position.

I felt my manager was sympathetic but in the end he said he didn't control salary and he could bring it up the chain and make a case. To my benefit his boss just got promoted to a higher position effective on this same day so maybe that will help me more but even though this person is quite senior in the organization probably needs to go through HR.

Although it would be ofcourse great to get what I asked, I'm looking for something. To me it's more of an acknowledgement of effort. He asked me a few interesting questions like on a scale of 1- 10 how I felt my current job both taking salary into consideration and not. I said taking it into account I felt like a 5 and without an 8.5. I felt I answered confidentially when he asked if I could handle the next level. He asked what I would do if I did not get what I wanted. I replied I would be disappointed but would continue to work to the best of my ability but that the request was about bringing my pay to the level as described by company.

At this point is there anything else I can do to make this more successful? The only thing I can think of to do is if I hear anything but the full amount to ask for more specifics on how to get to the next level.

[Freedomin5]

What I hear when he asked what you would do if you didn’t get what you wanted is him really asking, “How likely are you to leave?” If you’re going to be disappointed but work even harder to get to the next level then there’s really no incentive to pay you more since Not paying you more will cause you to work harder.

If it were me, I’d start looking for another job. If there’s nothing out there then stay in your current position until you find something suitable. If there is something better out there, then jump ship.

But that’s just me, and I’m not in HR, so I could be totally wrong.

[dragonwalker]

Part of the challenge with conveying a message that suggests I may leave is the fact he is aware that the company is currently paying for my graduate education and leaving at this time means I have to pay a large sum back so it's very unlikely I would be leaving. I hope that him asking me the earlier question about my satisfaction on the job both considering and not considering the money may hint to him that should I not receive the salary I want I may leave for another role within the company which would be the same as losing me in the job.