I'm looking for some guidance on how to handle a touchy situation. 

Due to a mistake by an external recruiting firm, one of my directs has discovered that he is making roughly $10k less than an external hire that we brought in to do the same job.  He has discussed this with me a few times, attempting to leverage that information into a raise or other improvements in his employment status. 

So far I have kept my responses vague, and I would like to get some input from the MT crowd on how to handle this situation going forward. 

I'm trying to imagine WWMMD (What Would Mike/Mark Do?) and all I can come up with is to warn him about over-playing his hand, remind him that I've helped him achieve 2 promotions in less than 2 years, and that internal salary increases are set with a different criteria than external offers. 

He is more of a High D, however, and I can easily see him driving this situation towards an impasse.  I won't be bullied, and the bottom line is that I don't want someone on my team who tries to play such cut-throat politics. 

I hope to draw his attention to the damage he's doing to his own best interests, but maybe I'm being too soft.  is my "High-S" showing?

pucciot's picture

I can relate.

I have a direct that brings up additional compensation every time I ask him to take care of an additional duty task.

I keep telling him I am doing the best I can.  It is mostly a decision made at a level 2 steps up the Admin chain.  I have little control.

You have already explained :

" internal salary increases are set with a different criteria than external offers."
Internal salaries always include roughly an extra 20% value in perks and fringe benefits.
Health plan - 401k etc.  
And it may be time for feedback to your direct.
I don't know when you discuss compensation and merit increases with your directs at your firm.  We only do it once a year.
At my organization I would probably remind the direct that he has already discussed this with me.
Suggested comment :   (You may wish to shorten it into the MT FeedBack model.)
"We can discuss a change in compensation after your next annual goals review, just like we always do.
I have listened to your points and concerns, I have not forgotten about you.
I will take it all in consideration and do what I reasonably can to address the situation.
When you bring it up continuously (3 times or 4 times)  before the annual review it shows a lack of trust and respect for me as your supervisor.
I consider this poor performance and communication.
Please improve you conduct on this matter."
Good Luck

donm's picture

Your firm is willing to pay $10K more for a new hire, but you leave an experienced person's pay lagging. Well, if your firm is hiring for that amount, then I would suspect other firms are hiring for that amount, as well. You're telling the guy, "We hire new people for more money than we would give to loyal and proven employees." It wouldn't take a big leap for the ex-loyal employee to think, "Well, maybe getting hired elsewhere is the way to get that level of money."

I bet he already has his resume out on the street.

The slip up is not with the external recruiter. It's the unfair way you pay your employees doing the same job.

uninet22's picture

pucciot - Great input, I really appreciate it. 

donm - You're absolutely right.  It turns out "Equal Pay for Equal Work" isn't just a problem for one gender or the other.  It can happen to anyone!

I guess this falls under the "No good deed goes unpunished" category.  I saw great potential in this direct and wanted to help him advance in the company.  I suggested he try to qualify for this position that was previously filled by external candidates only.  He doesn't have the official training, certifications or experience required, but I thought he could learn it in his spare time.  To his credit, he did.  After which, I was able to get approval for a promotion and a ~20% raise.  It took an act-of-God to get approval for anything over 10%, but it finally happened. 

The employee discovered what was being offered to external candidates before I made him an offer.  He accepted the promotion in spite of the salary discrepancy.  Now he wants to leverage that information to get further increases.  I can't blame him for doing so. Although I can't imagine my upper management will react well to the "pay-me-what-you're-paying-him-or-I'll-walk" approach.  Plus, since he doesn't have the official training/certification/experience, I'm not sure he could get a similar job at another company.  If he pushes too hard, they might just call his bluff.  And I would hate to see all his hard work come to that. 

I'm sure there are ways to handle the situation that will help us achieve a salary increase for him.  I hope to get more ideas from the MT crowd on how to go about it, as well as how to prevent him from committing some form of career suicide in the meantime. 

donm's picture

If he doesn't have the certifications, then he isn't in the same position as the external hire. That's all the reason you need to keep his pay at the current level. You also didn't say he took the position knowing about the pay discrepancy. He accepted the disparity when he took the position. I would remind him of that the next time he brings it up, and tell him that if his performance is in line with the position, his salary can be discussed during his next review. I would also tell him that we won't be discussing his pay again until that time, and if he brings it up again, remind him that the discussion is over.