Work and Salary Expectations

[citygirl]

Most upper management worked hard to get there. And while some are slackers (as in every level in a company), there are a lot of us that work hard. It's never as easy as it looks from the outside.

Nothing is stopping any person from going out and starting his or her own business. Power to those that do and if you are motivated to work harder than you ever will working for a corporation, it's a great way to earn money. It's also a great way to learn why capitalist pigs think the way they do Sitting on the other side of the desk is an eye-opening experience.

And as I've mentioned, we are a small company. I've tried my best to pay the employees well, I've fought with the US parent company to get them huge raises, we provide great benefits and have bent over backwards to be flexible and helpful including offering them the option to work at home at least 1x a week to avoid the commute.

I am just running out of ideas. As a small company that provides outsourcing, I can't go back to my clients and demand an increase in prices of 30 or 40%. So we've taken a hit in our profits in order to provide for our employees. And yet it's not enough.

So again - I'd love to hear some ideas on how people keep their employees motivated. B/C annual raises of 25% just aren't in the cards, let alone more for high performers.

 

[harrisonba]

Citygirl, have you considered asking each individual staff member (perhaps at performance appraisal time) what rewards he or she would value, huge raises aside? The answers may surprise you. As an added benefit, this will perhaps prepare them for the fact that huge raises are not in the cards.

My staff surprised me by asking for a paid day off on their birthday, an extended lunch break once/week, and a flex day (work a longer day and get a Monday or Friday off every two weeks). It sounds like you are a great manager and onto some great ideas -- you would think working from home one day/week would be a valued perk! Best of luck.

 

[starlucia]

We simply aren't in a position to offer the 30 or 40% raises that employees seem to feel are warranted on an annual basis.

Sometimes I wonder how many workers actually understand how the world of business works, or how costly running a business en blanco is in BA. It doesn't take a Nobel-prize-winning economist to realize that if a small-or-mid-sized business doesn't turn a healthy profit, it will shut down or be acquired, and then there won't even be jobs, much less raises, for the staff. Sometimes I hear these calls for 40% yearly raises, and I wonder, "WHERE do they think this money is coming from??"

In the US, companies that pay higher than the market average and treat employees well have a happier, more productive staff, and yay, everyone wins. A mediocre workplace retains mediocre employees, since the talented ones will be poached by more lucrative offers. But if an employee wants to earn a salary comparable to upper management's, then he or she would probably be better suited to self-employment, or starting their own business.

 

[MizzMarr]

I was just going to say what citygirl said. Any "employee" can save their money and take a huge financial and personal risk by starting their own company. The people "up top" have generally worked hard to get there and have taken many risks along the way. It's a lot easier to sit back as an employee and collect a paycheck. Nobody is forcing anybody to take a job, but a harsh reality of the world we live in is that you need money to survive, and ingenuity to succeed.

 

[Guillo]

Being on the other side (an employee), on the IT sector, I can give you some insight into the problem.

Some jobs, more than others, have been historically very well paid. People having a really nice salary, after inflation, see their salary get lower and lower compared to the costs of living. Unluckily for you, any raise under inflation (which is really not under your control, and even worse, not officially measured properly) will leave your employee feeling like loosing their status quo. And will pin it to the employer.

So people have expectations to have at least inflation adjustment (not be making actually less), and that raise, while good, doesn't mean much to them. Anything over inflation, well that's different.

So, thinking like this, a 30% raise, is actually a 5% raise (over inflation of about 25%), which is to say, not exactly what someone overperforming or having a promotion was expecting as a yearly raise.

On the other hand, anything under 25% is losing the value of the salary.

So, how to deal with this.... I really don't know if there is a way.

Everyone is expecting to have some kind of inflation-based raise and it should be clear that is what is when you give it out.
Then, according to merit, be clear that on top of the inflation raise, you are giving something extra.

The problem: those overperforming, the "stars", will usually end up with a raise that is not much more of those underperforming. And they will run for the hills unless they love the project, or have something (growth oportunities, for instance) that will make them want to stay.

I wouldn't want to be on your situation, is like a loose-loose proposition, specially if you cant raise your prices to compensate.

 

[ghost]

Most upper management worked hard to get there. And while some are slackers (as in every level in a company), there are a lot of us that work hard. It's never as easy as it looks from the outside.

Nothing is stopping any person from going out and starting his or her own business. Power to those that do and if you are motivated to work harder than you ever will working for a corporation, it's a great way to earn money. It's also a great way to learn why capitalist pigs think the way they do Sitting on the other side of the desk is an eye-opening experience.

And as I've mentioned, we are a small company. I've tried my best to pay the employees well, I've fought with the US parent company to get them huge raises, we provide great benefits and have bent over backwards to be flexible and helpful including offering them the option to work at home at least 1x a week to avoid the commute.

I am just running out of ideas. As a small company that provides outsourcing, I can't go back to my clients and demand an increase in prices of 30 or 40%. So we've taken a hit in our profits in order to provide for our employees. And yet it's not enough.

So again - I'd love to hear some ideas on how people keep their employees motivated. B/C annual raises of 25% just aren't in the cards, let alone more for high performers.

I feel your pain and understand your position. You shoulder the risk and worry, they show up on time and expect a 40% salary increase. Which in Argentina costs you closer to 65%-70% +. Which means that next years 40% will blow the lid off of 120% in a 13.5 month span. I'm not sure about you but I have never received a raise based on inflation [way back when I was an employee], or a bonus for punching the clock. Productivity merits increases, breathing and taking up space does not.
Further, employees who don't have the common courtesy to simply thank an employer for recognizing their effort are ingrates and have the mind set that is typical here for the adversarial employer/employee relationship that exists. Adding that relationship to the government's adversarial attitude regarding businesses and you have a nearly imposable situation.
OK, sorry for the rant. But I think you need to sit down with yourself and examine your true motivations for doing business in a hostile environment. You may find that your personal goals are out of sync with corporate goal and with long term reality projections.
This process was very painful for me after 8 years or so but the situation demanded that the business model needed radical change. And that's what it got and that's what you get paid to do. Feel the pain.

 

[jb5]

Do employees really believe they can get inflation based raises and companies will remain in business? Surely there is much written about this that should result in an understanding that many would be without jobs if employers were to keep up with Argentina's crazy inflation.

How do global companies deal with this? I can't believe Microsoft and IBM are handing out 30% raises.

Citigirl, are your employees educated/professionals? Do they understand the premise of outsourcing--that labor rays need to be low to make it worth your company being there as opposed to in India, China or Mexico?

What's the unemployment rate?

Do professionals and rank and file workers look at this the same way?

Ghost, how did you change the model?

 

[citygirl]

Thank you everyone. To address a few specific points:
Harrisonba - thank you. I have already done a few surveys. One of the big ones was working at home which we instituted. Another was after-office or something like that which I try to do on semi-regularly. They wanted more time off as well but unfortunately, that's not really an option given they already have study days (I think it's 10 a year) plus holidays and vacation days and sick days.

Guillo - thank you as well for that perspective. Let me ask you, as an employee, what else would you look for besides an increase in salary?

And ghost, believe me, I am feeling the pain We've already made the difficult decision to put new projects elsewhere given this environment.

Again, this wasn't a "personal" decision - the parent company values me but not enough to start up a subsidiary company just to make me happy We have had really good work quality here, we can support LATAM and still be near-shore to the US and from a performance level, I'm very pleased with my employees. Again, they have worked hard and I have worked hard to be fair to them. But huge increases simply aren't in the agenda for the foreseeable future. It isn't possible.

If there are ideas out there other than raises, I'm definitely open to them and I am always interested in learning from others. I do want the business here to succeed as we invested a great deal of time and money in getting this operation up and running. And obviously, from a personal level (although not professional), I would like the business to succeed because this is my home. I don't need to have the company here to work - my job duties are not location specific but it does make me happy to contribute something to the place where I live.

 

[fifs2]

Thank you everyone. To address a few specific points:
Harrisonba - thank you. I have already done a few surveys. One of the big ones was working at home which we instituted. Another was after-office or something like that which I try to do on semi-regularly. They wanted more time off as well but unfortunately, that's not really an option given they already have study days (I think it's 10 a year) plus holidays and vacation days and sick days.

Guillo - thank you as well for that perspective. Let me ask you, as an employee, what else would you look for besides an increase in salary?

And ghost, believe me, I am feeling the pain We've already made the difficult decision to put new projects elsewhere given this environment.

Again, this wasn't a "personal" decision - the parent company values me but not enough to start up a subsidiary company just to make me happy We have had really good work quality here, we can support LATAM and still be near-shore to the US and from a performance level, I'm very pleased with my employees. Again, they have worked hard and I have worked hard to be fair to them. But huge increases simply aren't in the agenda for the foreseeable future. It isn't possible.

If there are ideas out there other than raises, I'm definitely open to them and I am always interested in learning from others. I do want the business here to succeed as we invested a great deal of time and money in getting this operation up and running. And obviously, from a personal level (although not professional), I would like the business to succeed because this is my home. I don't need to have the company here to work - my job duties are not location specific but it does make me happy to contribute something to the place where I live.

Marcsoc aside this has been a refreshingly honest chain from all involved with a "who knows the real answer" as being the result. I can only say that the Y generation needs lessons in good manners, even if a 30% pay increase only equates to 5% after inflation it is given with much effort and affection particularly if the company (ours) is actually being asked to reduce its prices because the whole world except Latam seems to be in crisis. I would never have dreamt of not saying thank you for such, nor the bonuses,employee awards & recognitions, which never seem to be enough...for us once salary review time is over the complaints about the type of yerba start...we only have 5 types of olive oil on offer, 3 types of yerba and 2 types of coffee...but for a PYME employee (80 staff) it is considered disgraceful...Hello!

If its any comfort, Brazil which does have a more stable workforce due to <5% inflation has less issues with the details of the store cupboard but equally less manners...for them the issue last year was why the seniors got to get their twice weekly massage before the less seniors...
Message:get a grip because some day you may find yourself grateful for a good job, massage,yerba or not...not to mention gym, healthcare, pension, viaticos etc...

 

[Ashley]

I have to completely agree with Guillo on this one.
I am an employee here (in an Argentine company with some international clients) and haven't had a pay rise for over a year. About 18 months ago, I got a 10% increase - effectively meaning that what I earn is worth about 50% less than 2 years ago.
I do understand that most companies are completely unable to give annual raises in accordance with inflation (let alone bring performance into the mix) and it does leave employees, however well-treated, feeling somewhat embittered. I think a big part of the problem (for me, at least) is seeing other companies (usually bigger, multi-nationals) give employees higher raises or seeing union protected employees get raises. It makes you feel like you should just ditch your current job and go and work for one of those places. I mean, "if they're getting 30% raises in (wherever), why aren't I?" For me, I feel particularly bad when I see my boss increase his own fees and not pass that down the ladder a bit (though I am sure it is more complex then that) or hire temporary freelancers on good rates.
Having said that, I do get good benefits at work - homeworking, flexible hours, understanding when it comes to time off, etc...all of which help. I think any further perks (gym membership or employee discounts) would actually make it worse ("Just give me the money, dammit).
I think the best thing that you can do is be understanding and patient...the situation sucks for everyone atm. Perhaps offer more training opportunities or a chance to work-shadow people higher up the ladder. That way, you feel like you're "going somewhere" even if your salary isn't. At the moment, that's pretty much the only thing keeping me in my job!