6 tips for having easier salary review discussions

Salary reviews may seem like a touchy subject, but they don’t have to be.

You can handle salary review requests and salary review expectations through clear communication and planning in advance.

You have a range of options

Setting a schedule or framework for salary reviews is not “one size fits all.”

Design a program that works for you and your business.

Although there are many options, here are a few to consider:

  • Set reviews in stone and % increase as per budget forecast
    • Note: these are usually carried out around July linked to a performance / professional development review. However, this could be any month that works for your business and budgeting process
  • Follow CPI increases with automatic increases made in line with amount
  • Uncapped (either for all or particular roles), set with 3 year expectations linked to performance
  • Yearly reviews (any of the above) with quarterly check-ins to review progress and goals

By establishing a framework for your salary review, employees know when to expect conversations and possible pay increases.

Consider the time and effort involved

Having conversations, reviewing performance and adjusting payroll all take time and energy.

Be sure your salary review schedule makes sense from a business and resource standpoint.

You want to keep employees engaged and motivated, but not make it a tedious or wasteful process.

Making a plan

Whichever schedule you choose for salary reviews, it’s critical to:

  • Formally write down the plan
  • Set calendar reminders or other ticklers
  • Schedule ample time on your calendar to complete your end of the work
  • Formulate a communication plan for employees

By giving your salary review plan adequate structure, you’re more likely to stick to it and follow through with it.

Communicate, communicate, communicate!

An often-missed step in the process of salary reviews is communicating with your employees about how and when salary reviews will take place.

Amy Gallo shares in a recent Harvard Business Review article, “It’s a critical part of a manager’s job to have frank and open discussions with employees about pay.”

So be sure to clearly communicate when employees can expect to hear about their salary.

And what their possible increase will be based upon.

What not to do: Forgo telling staff and expect them to know how the business — and they — are performing.

6 tips for salary review discussions

To keep discussions clear and comfortable, here are my 6 key tips:

[vc_row][vc_column width=”1/2″]Tip #1: Communicate upfront[/vc_column][vc_column width=”1/2″]Share with current and future employees the plan for the year. Let them know what to expect and when to expect it.[/vc_column][/vc_row]


[vc_row][vc_column width=”1/2″]Tip #2: Let them know it’s on your mind[/vc_column][vc_column width=”1/2″]During one-on-one conversations, feel free to remind employees that you look forward to discussing their salary review. This will make them feel valued and cared about.[/vc_column][/vc_row]


[vc_row][vc_column width=”1/2″]Tip #3: Involve others’ feedback and input[/vc_column][vc_column width=”1/2″]Include managers and senior leaders in determining new salaries or bonuses (if possible). This allows any personal bias to be balanced out.[/vc_column][/vc_row]


[vc_row][vc_column width=”1/2″]Tip #4: Prepare for the discussion[/vc_column][vc_column width=”1/2″]Think ahead about what you’re going to say during a positive or more neutral salary review.[/vc_column][/vc_row]


[vc_row][vc_column width=”1/2″]Tip #5: Be clear about their value[/vc_column][vc_column width=”1/2″]No matter what type of a salary adjustment you’re communicating, share the employee’s value and sincere appreciation you have for them.[/vc_column][/vc_row]


[vc_row][vc_column width=”1/2″]Tip #6: Explain decisions[/vc_column][vc_column width=”1/2″]Depending on the reaction of the employee, you may wish to explain how you came to your conclusion about their salary. Provide context or share business decisions so the employee knows it’s not personal.[/vc_column][/vc_row]


In addition to the expert tips above, I want to share one extra special tip with you.

  • Bonus tip: Let new staff know when they will get included in any new salary reviews.

Many companies don’t communicate this and employees are left wondering when their salary will be reviewed — and if it’s even on anyone’s radar.

Stand above the crowd and be the one to communicate with new hires.

Any questions?

If you have questions on this topic or any others, feel free to reach me by email or set up a free one-on-one consultation session, or drop me a comment below.

Thanks for sharing!