« Looks Like Lehman Brothers Forgot Their Mission Statement! | Main | Rick Wagoner on Why GM Deserves “Support” »
Reader Joe Wants Your Opinion
By JLP | November 19, 2008
I received this email yesterday from a reader named Joe:
Hi JLP,
I have been a big daily reader for some time.
Last week at the company meeting (I work at a non profit church in California - 8 years) it was announced that the endowment has been reduced due to the economy.
So, there will be across the board for a staff of 19 no salary increases.
Now, am I being unrealistic?
Since I have been there for some time, and a lot of other folks have arrived in the past three years, their salaries are much higher, so they can ride out this wave.
I really, really depend on the 3% each year. So for the folks making 100,000+ versus my salary which is about 60% lower - why must we all share this sacrifice?
Am I being unrealistic or should I be thankful to have a job in the current economy?
Just wondering and would be interested in what other folks have to say.
Joe,
Yes, I think you’re being unrealistic given the circumstances.
I think you should be thankful you have a job and then I think you should ask yourself why you’re making so much less than the others. Maybe you should start making preparations to go work somewhere else or make yourself more valuable to your church.
Perhaps you could take on another job to make up the difference of $100 per month (3% of $40,000 is $1,200).
What do you guys think? Is Joe being unrealistic?
Topics: Question of the Day |
November 19th, 2008 at 11:05 am
I agree completely. Nobody is paid because of what they think they deserve or need. They are paid on the basis of the value they bring to their employer. Make yourself more valuable or find someone else who will value you more.
November 19th, 2008 at 11:05 am
i hope this isn’t Joe the Plumber asking…;) j/k. If the issue in question that Joe is being unrealistic about is the 3% expected increase, i would say, no, he is not being UNrealistic. a lot of people take that into account, but i would caveat that by saying one should never budget something ahead of time (eg. finance a big ticket item like a car or mortgage) assuming that 3% will be there (they should wait until the 3% happens, then perhaps go for it). however, if the issue is whether he should expect to get a 3% raise while EVERYONE else, higher salary or not, does NOT get it. That would be unfair to them as well. We live in a society where it’s so ME ME ME and we forget how if we were to get something at the expense of others, that’s inequality happening as well.
November 19th, 2008 at 11:09 am
The problem is that if he gets a 3% increase, someone else has to get a decrease. No one likes to have their salary decreased, so probably someone would decide to quit. Unless Joe is willing to quit over the lack of increase, they have no incentive to do anything else.
November 19th, 2008 at 11:35 am
My company recently announced they are doing the same thing for 2009 - everyone from top partner to mail room dude is staying the same in 2009 - no raises or bonuses. Will it be tough? Yes - because in January my 401(k) contribution is set to go up 2%. This increase is usually covered by my raise, but not this time. So in effect, I may see my paycheck go down a few bucks. However, getting a paycheck (even if I keep the same salary for 2 years) means I HAVE A JOB. Something that I feel very fortunate to have given the current economic climate.
November 19th, 2008 at 11:43 am
I agree, Joe is unrealistic. My DH works in gov’t and we went years w/out raises bc the $ just wasn’t’ there (meanwhile, our health insurance went up 50% every year). This is how the world works.
This reminds me of something DH’s old boss did. He decided that it was “unfair” that “everyone did the same work” but new employees earn less than more senior employees. So he made a proclamation that the more senior you are, the less wage you’re eligible for so that things would be “fair.”
The problem is, that’s NOT fair. And I’ll leave the political commentary out
November 19th, 2008 at 12:22 pm
I want to know why you have employees at a non-profit churching earning $100k+. That is too much money, especially in a church setting with tithe/donation money. I’ve worked at a non-profit that employed about 20 and the highest paid person was making $65k, the avg paid person was about $35k.
It was all about the mission not the paycheck.
November 19th, 2008 at 12:42 pm
I work in a small insurance agency in the Chicago area. Costs for everything have skyrocketed, yet the staff excluding owners have not gotten a pay raise for almost 4 yrs. We get at the end of the year a $500 bonus but by the time they take out all the taxes, etc. it is not worth much. Reason for no increases…the sales people are all semi-retired and no one is out selling. Our fault–no!! Choices–stay or leave. In this economy,I will stay.
November 19th, 2008 at 12:43 pm
I don’t think that it is a question of being realistic or unrealistic. Everyone believes that they deserve a raise. However, if you company has decided to not raise salaries, there is little you can do about it.
However, that doesn’t mean that you should not take your career into your own hands. I find that the biggest raises come from finding a new job. So, go out and find a job making more. I bet you can find one that will pay you a lot more than 3% over your current salary.
-Fred
November 19th, 2008 at 12:44 pm
Now hold on. Let’s go back to the comment that he made about new hires hiring in for more than he did. Not every organization pays by worth. We won’t even talk about Unions. I have seen someone who hired in at 40,000, worked for 10 years making their 3% to see someone hire in at the same job doing the same thing for $50K a year. You’re telling me that this guy who’s toiled for 10 years, faithfully, only deserves to make $3k more than a new hire? It may have nothing to do with Joe’s value to the company. I got hired in to my company for 4k more than I previously made. That’s how they determined my starting pay. It had nothing to do with the value of my job or my value (because I am way better than the last guy and my appraisals prove that)
Management are people to and sometimes raises are decided by nothing more than something said last week or a weak appraisal from a manager (who isn’t involved to know).
I also expereinced the “no raise this year” in 2003. It however was across the board and I didn’t feel “cheated”. My only point to this is if other’s are making more than him because they recently hired in, don’t presume that it’s because there is a problem with Joe. If a company only pays a cost of living raise but hires in at the value of the job now, old-timers can get screwed.
November 19th, 2008 at 12:54 pm
PW,
Sounds like an opportunity to me. Why don’t you get your licenses and start working the books?
November 19th, 2008 at 12:58 pm
Patrick,
I based my response on the email. I have no idea what kind of person Joe is or even what kind of job he does.
If Joe sees people getting hired and making more money than he’s making, then he needs to have a talk with management to find out what he can be doing to earn more money. If they aren’t interested in working with him, then he needs to go look somewhere else for a job.
November 19th, 2008 at 1:12 pm
There’s not much Joe can do about the 3% raise issue. The church is being fair to everyone it appears.
My advice to Joe:
Go to your boss for a frank discussion about your peformance, career path, and salary. As part of that discussion, ask for an explanation as to why you’re paid so much less than others.
Do they shoulder more responsibilities?
Do they have more experience?
Are they more educated (and presumably more knowledgable)?
Are they better workers?
Do they have unique skills that you lack?
Approach your boss respectfully and without any agenda. You just want to learn so that you can be a better employee and improve.
If your boss avoids this discussion or can’t give you good explanations, then you need to consider employment opportunties elsewhere or be content to be taken advantage of. The handwriting will be clearly on the wall in that case. Otherwise, if there are good reasons, then ask what it will take for you to improve so that you’ll merit comparable pay. That will point you in the right direction.
Don’t just sit there. You have nothing to lose and very much to gain by being proactive. If things go really well, you may already have a solid case for a substantial raise the next time around.
I was in a similar situation with an employer back in the ’90s and I took this exact approach with my boss. He saw the inequity and went to bat for me. A few months later I ended up with a promotion for the effort. It does work.
Hope it does for you too.
November 19th, 2008 at 1:21 pm
Both my husband’s and my employers have told us the same thing. Our employers are also doing layoffs. We live below our means but we’re very happy to be employed. I hope Joe can find a way to cut back on expenses, ride out the downturn, and appreciate being employed at a place he seems to enjoy.
November 19th, 2008 at 2:05 pm
JLP -
I don’t think you can say one way or another if he is being unrealastic or not. How is it unrealastic to be upset that you aren’t getting a raise because of the economy when others around you are making twice or even three times as much as you are.
On the other hand, there is nothing at all stopping Joe from applying for other jobs, either as a tactic to get a pay increase at his current employer or as a real opportunity to leave his current employer and make more money elsewhere.
Joe, it’s pretty cut and dry. No one is twisting your arm to work there. If you don’t feel you are making the money you should then get out. Go find another job. Freshen up your resume and get the hell outta there!
November 19th, 2008 at 2:18 pm
Christopher,
You better shut up or I’m gonna smack you the next time I see you (FOR THOSE OF YOU WHO DON’T KNOW…Christopher is my brother so I can talk to him like that!).
Although Joe doesn’t say it in his email, I think we have to assume that if he’s making 60% less than others, he’s NOT doing the same job. Either that or they have huge pay discrepancies within their church.
November 19th, 2008 at 2:51 pm
As with most situations like this: It depends. Joe may be doing the most high level work of the other folks and being drastically underpaid. But I doubt that would be the case. (If so, he should start looking but be glad he has a job.)
November 19th, 2008 at 2:55 pm
There’s a flaw in logic when stating that it’s unfair that new hires are starting at the same rate as the ones who’ve been at the company for a few years alreadyt:
The most important to remember is that when a company hires people they are making an investment in what’s in the market. Thus, just like in the stock market where stock prices go up (at least in good times), the same happens in the hiring market. The current employee is stuck making the bond rate: 3-5% raises. The best way to get a higher wage is to take the risk and jump into the hiring market again (but do your research first–the wage increase might not outweigh the risk).
As far as those who have been reliable workers for a decade plus: maybe it’s cause I’m in my 20s but today’s corporate world ain’t what it used to be. Loyalty isn’t a priority anymore–and just like the corporations need to fire people to survive, workers need to go elsewhere or work for themselves if they expect a certain wage. Everyone’s gotta balance their books…
November 19th, 2008 at 8:38 pm
3% of 60K is a big difference from 3% at $100K. I totally understand that Joe could have come in at a lower level and moved up the church ladder. I think Joe should make his case to management that when you’re making $60k and a loyal long term employee, who may have been stuck in a lower pay tercile because of HR guidelines, that if increases are given out to some employees, those at the lower end of the pay scale should be considered first. It shouldn’t be based upon how big your family is or how to devout you are or whether your wives are friends outside of work. It should be based upon socio-economic rationale and meritocracy. I wouldn’t bring seniority into it because those newer employees could end up becoming long termers if they get raises.
November 23rd, 2008 at 4:25 pm
If you think salary freezes are a real bummer, try salary cuts. One year, things were so bad, I had to hand out 10-15% salary cuts to my staff. But, to Joe’s point, it only affected the VP and above positions which were six-figure jobs. The thinking was that junior staff were likely to be younger and with a smaller salary, would have less of a financial cushion. The more senior staff members ideally would have been saving their previously healthy bonuses for a rainy day (though we know it doesn’t always work that way). The reasoning had a certain logic to it that I though made sense.