94% of company finance executives would promote employees without offering them a pay rise, according to research by recruitment service provider Robert Half.
Among the 200 chief financial officers (CFOs) and finance directors (FDs) interviewed, 42% would promote without raising pay so that employee performance can be assessed in the new role.
The other main reasons cited for promoting employees without a pay increase were:
- Lack of resources (27%)
- The need to fill the vacancy quickly (18%).
Other findings from the research:
- 28% of CFOs and FDs recommend making a request for higher pay at a ‘business critical juncture’ such as the start of a new project
- 11% believe the best time is at the end of a project
- The major factors affecting whether a company increases its remuneration budget are company performance and the economic and political climate.
Phil Sheridan, senior managing director of Robert Half UK, UAE and South America, said:
“Offering your employees increased responsibility and the opportunity to learn and develop can be 1 way to boost your employee retention, loyalty and motivation, even when the funds may not be available for a pay rise.
The risk with this approach in the long-term is that employees start to feel undervalued and with the new skills they have developed, they look to greener pastures to receive a competitive remuneration.”