How to tackle pay negotiations in these tough economic times

Knowing what to ask for and what to offer can lead to win-win solutions for employees and companies. Because money is tight, all parties should be putting creative alternatives on the table. By

Like global counterparts, South African companies and workers are grappling with a gloomy economy. And as salary and incentive negotiation season nears, both parties face the question of what constitutes fair compensation in the prevailing climate.

As much as employers might want to keep pace with inflation, the pressures are many and varied. Companies will want to play it safe and resist big increases and bonuses to keep the balance sheet stable. But that does not mean employees have no negotiating power and that companies can’t find other ways to invest in their people.

With not much extra cash on the table, companies need to get creative to ensure they keep teams in healthy shape and the bottom line resilient.

The key to solving this seemingly impossible equation is for the employer to introduce, and/or the employee to request, investment in career development and working conditions.

This eases financial pressures and ensures improved future career prospects for workers and a stronger talent pipeline for companies.

The two biggest bargaining chips are flexibility and career development.

We would all like to earn more money, and most good companies would like to offer loyal employees better pay. But, if money is tight, other ways must be found to attract and retain talent and options must be available during wage negotiations.

Some alternative solutions for both companies and employees are:

Flexible work arrangements

Earlier this year, many employers called for an all-hands-on-deck return to work of most employees. However, given that the environment remains dynamic and volatile, and the fact that most infrastructure to allow for successful work-from-home arrangements remains in place, providing greater flexibility can be a powerful incentive. It cuts costs for all parties, reduces work stress and contributes to employee loyalty.

Mapped-out career progression

Companies can actively facilitate the career progression of employees, with relatively low-cost investment in the moment, but the promise of dividends for both company and employee down the line.

A key factor for career growth is exposure to things outside the current area of expertise or duties.

Employees can, for example, ask to attend industry conferences and events in the coming year, and be assigned to different projects or teams, giving them experience in different parts of the business.

Another mutually beneficial carrot is the plethora of online programmes, accessible globally. Yale and Harvard, for instance, offer online leadership programmes at a fraction of the cost of traditional MBAs.

MorE tImE off or sABBAtICAls

A break from work stress is a great benefit, especially if it is of sufficient duration to allow for personal pursuits such as volunteer work, travel or doing a course. The benefit to the company is a person returning refreshed, possibly brimming with new ideas.

Mentorship and coaching

Companies can provide dedicated mentorship to employees. Having access to senior executives within an organisation can help emerging leaders navigate issues such as corporate politics, career progression, conflict and workplace culture. This allows for knowledge transfer and development of problem-solving skills.

Coaching is more affordable and productive than ever before, through organisations such as Virtual Coaching Partners. A good coach can help experienced and emerging leaders identify weaknesses or blind spots and show how to get the best out of people.

Mental health support

A focus on accessible, anonymous and ongoing support by mental health professionals is a win-win for everyone.

Relatively low-cost career development solutions, combined with flexible work solutions and mental health support, can change the remuneration game.

The world is gearing for a tumultuous road ahead, at least in the short to medium term, but ensuring employees are confident they are going somewhere, focusing on building relationships, staying the distance and using time wisely can ensure companies and teams emerge stronger.