It’s that time of year when performance reviews roll around, and it could be just the opportunity to secure a pay rise.
Andrew Morris, Director at global recruitment firm Robert Half, says “Performance reviews can be the right time to broach the subject of a pay rise – but enjoying an uptick in pay isn’t just a matter of good timing.”
In many businesses, pay rises are linked to an employee’s performance and results rather than their seniority, and Morris cautions that you need to be prepared to make a strong case to show how your efforts have benefitted the company, and the value you bring to their role.
With this in mind, Morris recommends taking six important steps to gain maximum value from a performance review.
1. Know what to expect
Having a good idea of what will happen in a performance review can help to settle nerves says Morris – and you’re entitled to know what will be asked of you and the benchmarks against which you’ll be assessed. “Don’t be afraid to ask your manager what’s involved with the process,” recommends Morris. “It shouldn’t be one of secrecy.”
2. Make a note of what you’ve done well
Prepare for your performance review by looking back at your achievements, where you’ve done well, and the key performance indicators (KPIs) that you’ve met or exceeded during the review period, advises Morris.
Compile a folder of any positive feedback you’ve received from clients or customers or praise you’ve earned from senior colleagues. “If the feedback was verbal,” says Morris, “ask the source to document it in writing.”
3. Look back over your last performance review
It’s likely you and your boss set some personal goals for you to work towards in your last performance review. Morris says it’s a good idea to revisit these targets, and “consider whether you have achieved what you set out to accomplish”.
If you haven’t reached your previous goals, note the reasons. “Maybe you were called on to assist with a large project, or your department has undergone a shift in direction,” suggests Morris. “The key is to be able to explain why any goals or targets have gone unmet.”
4. Provide evidence of why you deserve a pay rise
When you’re planning to negotiate a pay rise, it‘s good to consider things from your employer’s perspective – will your manager be able to justify the cost further up the chain, and can the company even afford it?
These issues highlight the need to present a watertight case for why you believe a pay rise is deserving. “Look at whether you have taken on more responsibility, trained or mentored other staff, or if you have performed duties outside your job description,” explains Morris.
5. Know what’s a reasonable salary
Rather than simply pitching for the salary you’d like to receive, Morris says it’s critical to do some background research to get an idea of the market salaries that apply for your role and location. “Knowing this information will allow you to make a factually accurate case to your manager when asking for a pay rise,” explains Morris.
A number of resources are available that can provide an idea of market salaries. Take a look at the likes of the Glassdoor salary index, or download the annual salary guides produced by recruitment firms like Robert Half or Hudson.
6. Have a back-up plan
Employers aren’t always in a position to offer a pay rise, and Morris notes that if a boost to your take-home salary isn’t an option right now, it’s worth considering other alternatives that would work for you. Employee benefits such as a car allowance or subsidised childcare or gym membership can still put more money back in your hip pocket – extra funds that could be used to buy your home.
Above all, keep your cool. Morris explains, “You won’t always get what you were hoping for but adopting a professional approach to the performance review can go a long way to getting you a salary increase.”
Talk to your Aussie Broker for more tips on the steps you can take to prepare for a home loan.
You may also be interested in How to earn more money so you can buy a home, Make your money work for you and Boost your borrowing power with alternative sources of income