What do you do when someone asks for more money, but you know they are already overpaid?
I hired a young guy with no experience to work with me and I offered to pay him what the big companies are paying their more seasoned workers. At the moment I am also paying him cash so I am essentially paying him out of my pocket and he isn't claiming it. He asked me the other day if I could pay him more so I explained that what he is making for his position and the hours he works is insane, and the only reason I paid him what I am is because I really like him and I know he can do really well with me in this industry. I am finding it hard to really drive this point home to him and want him to stay with me and be happy.
I don't want to lose this kid as he has made my life a lot easier and together we are generating a lot more income for the company. I told him that any jobs he finds, sells and completes on his own, 40% is his, and any job that I book for him and he completes he gets 10%. That would be on top of his weekly salary also. I think I can adjust these numbers a little as a start to keep him motivated but I am wondering if anyone has any other ideas?
I’ve learned that wanting to keep a great employee and being afraid to lose a great employee are two VERY different things.
Especially when I first started hiring, it was easy to think, “They’re good, they make my life easier, I don’t want them to leave…so how do I keep them happy?”
But you can get yourself into trouble if the answer is always more money.
For us, I want compensation to have some structure behind it. What does this position pay? What does someone need to learn or accomplish to move to the next level? What additional responsibility are they taking on? How can they earn more without me just permanently increasing payroll every time someone asks?
If you genuinely believe he’s already being paid very well for his current position, I wouldn’t feel pressured to raise his base just because he asked. Instead, I’d show him the PATH to making more.
I actually like that you’re already thinking about performance-based opportunities. If he can bring in work, sell it, take ownership of it, or eventually take responsibilities off your plate, give him ways to financially benefit from that growth. (For example, my operations manager started as a cleaning tech. Four years later she’s compensated appropriately for running daily operations and I only get involved for finance or legal things.)
That changes the conversation from “No, I won’t pay you more” to “Absolutely, you can make more, and here’s exactly how.”
I also think sometimes we assume money is the only reason someone stays. Pay matters A LOT, but so does being respected, having good equipment, knowing what’s expected of you, having some flexibility, being recognized when you do a great job, and seeing that there’s somewhere to go within the company.
One thing I’d be careful of is negotiating against yourself because you’re scared to lose him. If he’s valuable to your company, recognize that and create opportunities for him. But whatever compensation structure you create today needs to still make sense when you have 5, 10, or 20 employees asking for the same thing.
That’s something I wish I had understood much earlier: don’t create a compensation plan for ONE employee. Create one you can actually build into your SOPs
