Keep your best people happy with these unique pay strategies
Thursday, February 04, 2016
In the midst of an ever-tightening labor market, employee retention is a hot topic once again.
Here are three ideas about how you can boost employee morale and retention with just a few tweaks to your existing pay policies. Let's face it, those policies were probably written years ago and have nothing to do with today's economics or workforce realities anyway.
Double down on loyalty from day one
Let's say you have a new-hire budget of $9.50 per hour for a 40-hour week, but you luck out and find a great candidate with superb references who accepts your first offer of $9. On the employee's first day, when you spend some one-on-one time together, set clear expectations and cement future loyalty by saying something along these lines:
"I can see you're going to be a real asset to our team, and it's clear to me you'll be a great example of what dependability and great customer care should look like. That's why, instead of the $9 we previously agreed to, I've decided to start you at $9.50 instead. I know you'll prove I've made the right decision."
Skip the calendar altogether
The systematic review and reward systems in place today were created for all kinds of sensible reasons, I'm sure, but things change faster and faster these days. Don't let good people leave because they get a better offer before you're scheduled to give them their annual performance review and/or merit increase.
Give raises to your best people when they earn them — when they take on new responsibilities, when they save the day, when they clearly outperform most others and are most deserving. Don't let the calendar undermine your retention efforts.
The 90-day performance review
Let's say you have a new hire who goes above and beyond to earn that 25¢ per hour raise new hires are eligible for after three months. How much more bang for your buck would you get if you told them instead:
"You have so added so much real value by the way you [specific examples of attitudes and behaviors], that rather than just give you that 25¢ an hour raise starting tomorrow, I'm going to make it retroactive to your first day."
Do the math. You just spent a whopping $120 "extra" to earn an even higher level of hard work and dedication to your cause.
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