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I got caught off-gaurd today when a direct asked me during her annual review why a colleague of hers who started after she did was getting paid more. She felt she deserved a higher salary because of her tenure. She claims she found out this information when this colleague's paystub without envelope was inadvertanly placed in her box.

The more I think on it, the more dubious I am about how she found out. But, giving her the benefit of the doubt, how do you answer such a question without breaking confidentiality on behalf of the other staff member?

I eventually stumbled to "Okay, I can understand you're upset by that. Let's go over your review and we can talk about the raise you're receiving."

How can I do this better next time? Should I try to learn if she went out of her way to find out what someone else was making?

tlhausmann's picture

I do not recommend investigating how your direct learned of the difference. I am hard pressed to see any positive outcomes.

I also recommend not getting drawn into a conversation making direct comparisons between your direct and their colleague. Instead, have your direct  focus on their performance objectives and accomplishments. Tie compensation discussions to accomplishments, performance, and growth.Their colleague (you do not indicate the other person reports to you) may have skills, qualifications, and responsibilities of which you or your direct is not aware.

Have you reviewed the casts? (part 1 and 2)

http://www.manager-tools.com/2007/10/annual-reviews-and-compensation-par...

ashdenver's picture

I would definitely keep the conversation focused on your DR, not her counterpart.  "This is about you and your opportunities, not about the other person."  (A grown-up version of "keep your eyes on your own paper.") 

I think there might be a difference in what commentary may be required of you depending on the triangle involved here.  Does this colleague of your DR's work for you as well?  If this is an inter-DR issue, it becomes a stickier wicket because your initial DR (with the complaint/inquiry) will have higher expectations of you -- to either provide more details because you know more details about the colleague or to provide some form of substantiation for the disparity within your span of control.  That said, you're not obligated (nor do I think should you) get into either of those areas. 

I have 7 DR's currently and the range of hourly salaries is nearly $11 (or an annual disparity of nearly $23k.)  I didn't have a hand in hiring ANY of them and I didn't make any job offers with any salaries at all which means my hands have been virtually tied with regard to salary distribution.  That said, if your DR doesn't understand "the way the world works" I don't think anything you say to her in a setting of this nature will get through to her.  (The 'setting of this nature' meaning where she is personally and emotionally invested.)  I'm relatively lucky in that I work in the payroll field where all of my people have exposure to the salaries of our clients.  Not that they use this for malicious purposes but they get to see that people who are completely clueless get paid obscene sums and the hard-working, smart, on-top-of-things type of people they deal with get paid peanuts.  They have ongoing exposure to the way the world works and they understand "them's the breaks."

That's not to say I don't also get the questions of "How can I maximize my earning potential in my current role? Where and how can I transfer into roles with greater earning potential?"  Those are MUCH easier to deal with because it's goal oriented with a clear focus on results.  An action plan can be developed, milestones monitored, deliverables achieved and so forth. 

If you absolutely must, I don't think much harm can come from a very brief high-level overview of "the way the world works" before moving into the particulars of how the two of you can work on developing the DR's career path to increase earnings.  In fact, come to think of it, it may be of benefit to your DR because it might show that you're taking her concerns seriously and not brushing past the emotional concerns to focus only on the tangibles.  (I hate to say it but women and men DO communicate differently and, in general, women want to feel heard before moving on to the problem solving phase.)  

(It's probably not wise to mention that one of the best ways to secure a relatively significant pay increase is to move to another company. Internal promotions are usually capped at a corporate-set percentage which can be quite limiting in comparison to being The One that another company wants & is willing to pay for!)

 

jhack's picture

Folks are often concerned about compensation comparisons.  

This old thread is worth reading in its entirety:   http://www.manager-tools.com/forums-2442 

 The short answer I use can be summarized:  

 - Life's not fair

 - You will never be happy if you compare your salary to other people.  

 - There is someone out there making more money than you, and you will be certain they don't deserve it. 

SO, then the conversation becomes: 

 - What number do you want? 

 - Let's talk about what you have to do to get there.  

As a rule, I refuse to discuss comparatives with others.  The person complaining will never be satisfied with any answer you give.  

Finally, as to how they found out?  Remember Horstman's law # 6:  There are no secrets.  Let it go.  Hopefully, her unhappiness will be punishment enough for reading the pay stub.  

John Hack

VPfreedude's picture

 I agree with previous posters here.  How he/she found out isn't all that important.  It is their version, or the two employees talked & discussed salaries or whatever.  The DR won't "unlearn" the fact so it's a bit moot in my opinion.

The next piece (again in my opinion) is not to compare between two DRs but to have a frank discussion about your firm's comp philosophy.  Where I work we are not unionized and thus tenure at our firm plays no part in a staff member's compensation levels (industry experience does as we expect more results from a seasoned professional) but that we are a meritocracy and as such performance dictates pay levels.

The next part is then to explain to the DR what areas they can improve on or additional projects they can take on to become a more valuable contributor so you both can justify a larger salary increase.

Again just my 2 cents but that's what I do with my DR