Peanut Butter & Pay Increase
Crazy high inflation, rising interest rates and total economic uncertainty abounds this holiday season. It’s been a long time since I have seen this type of uncertainty in the markets and in Corporate America… everything is so fluid. In my 40 years as a consultant though, one thing I have seen is HR departments wanting to adapt as quickly and as simply as possible in hopes of fulfilling their mission of attracting, retaining, and motivating the talent they need to differentiate in an intensely competitive market. One way that always is discussed in the ACROSS THE BOARD PAY INCREASE… or as I and this article call it, the “Peanut Butter & Pay Increase”.
I have never been a fan. 3 KEY Reasons:
1. Message to HIGH Performers—SLOW DOWN
2. Message to MARGINAL Performers—NO NEED TO WORK HARDER
3. It easily promotes being “average”, mediocre, and can accelerate good employee turnover.
The harder, but better route: PAY FOR PERFORMANCE!
Take the time—it increases dialogue between supervisors and employees as well as increasing retention!
Many years ago, the CEO of one of the largest energy companies and I were talking about this, and he shared “Brent, who wakes up in the morning, stretches and says WHAT A WONDERFUL DAY TO BE AVERAGE”. I just chuckled, since I know of no one… but how we acknowledge, value, and reward for performance is the key to any company being the best it can be.
This article by HR Catalyst does an excellent job discussing.
Merry Christmas and Happy Holidays—be blessed,
Brent & the 1REP Team