Help! Our employees compare wages
Help! Our employees compare wages.
“I am the head of Human Resources (HR) in a family business that makes metal parts,” says T. “As early as employee orientation, we tell people never to divulge how much they are paid. But many workers gossip about their wages, which makes others envious and angry. People complain a lot. I am thinking of enforcing a discipline policy against those who gossip about their salaries. Do you think this will work? How can we stop people from talking about their wages to others?”
My reply:
The answer is simple: You can’t stop them. Even worse, a discipline policy to penalize people from sharing information, however sensitive, out of their own free will, is senseless—and likely, will backfire on you and on management. Frankly, if your employees are not happy about their wages, then the problem lies with the company—in how compensation is measured, merits are tracked, ranking systems are communicated to everyone.
Before you get defensive, hear me out. As HR head, you have a duty to ensure that the existing pay structure is in line with best practices. Discuss with the owners and managers about performance appraisals and rankings; health, housing, transportation or other benefits; etc., and confirm that the bases for these are objective and measurable—and have been clearly communicated to all employees, ideally, during the same onboarding process you mentioned.
Many businesses are transparent enough to share salary scales with employees, and the bases for such ranges, which include seniority and performance. If you do this well, equitable salary scales can tamp down unfair allegations from unhappy employees. I hope your company has a salary scale based on sound criteria, and I pray that the wages paid are not just based on a whim of the owners!
If you do not have solid bases for salaries and adjustments, it is urgent that you discuss with the higher-ups how to institute a professional structure as soon as possible.
Of course, not every employee complaint is justified. If your company has disseminated the above points clearly—and the complaints are fueled by just a few disgruntled perpetrators—then as HR, you need to address the issue directly and personally with them. If a worker claims that they are performing as well as someone else who received a higher raise, then aside from explaining objective salary scales (for instance, the other worker may have longer tenure), you can directly ask the complainant for proof that they are as productive as they say they are.
I do not know if you are privy to salary increases done by your senior management, but most HR heads in family businesses are. If this is the case, you can even tell the complainant, “We appreciate that you are doing your best. But according to your boss, other people have increased sales for this much percent, more than you have, etc. I can set up a meeting with your boss so both parties can set objective measures, like if you increase profits by this much, in return you may get a certain bonus. If an agreement is reached, you can all sign off on it, which we can abide by next time.”
Filipino employees often cite personal reasons when asking for salary adjustments. Consultant Rey Elbo warns against this in BusinessWorld: “If you decide to turn down a request, it’s important to do it without being unreasonable. Almost all people will accept your decision if your reasoning is carefully crafted and explained. Whatever you do, do not be swayed by the emotions of workers who may cite irrelevant issues like being the family’s sole breadwinner. Personal circumstances and family situations are not a consideration for adjusting salaries. Therefore, focus on the letter and spirit of your management policies. Do not be swayed by desperate, emotional pleas. Otherwise, it will open the floodgates for other employees to do the same thing, to the detriment of the actual high achievers.”
For employees who truly need help, a company no-interest loan or a community pass-the-hat will work better than adjusting salaries for no objective reason. Good luck.
