Five tips for negotiating a pay rise

Five tips for negotiating a pay rise
Preparation is key when asking for more money. Photo credit: Getty.

For employees wanting a pay rise in 2020, with end-of-year reviews looming and little over six weeks to Christmas, now is a good time to prepare.

Pay is often reviewed at the anniversary of the employee's start date, or as part of the annual performance review discussion.  Company policy will usually dictate the best time to discuss a pay rise, but as most companies set budgets in the months leading to 31 March, it's wise to get in before then.  

As money discussions can be delicate, Newshub spoke with a performance coach and an expert from online recruitment website SEEK to find out how to prepare, how much to ask for, meeting etiquette and how to respond if a request is declined.

Be clear on why

While working hard and putting in long hours is one thing, Ruth Christie, a leadership and personal development coach at Transformance, said that it's important for employees to provide evidence of their worth.

"What new projects have you taken on, what skills have you gained [and/or] how can you show that your role has evolved and now has more responsibility?  

"Think through all of these points and prepare some notes so you can clearly state your case to your manager," Christie advised.

In addition to the amount of the pay rise, a high-level career plan will help employees to pursue areas of development and assist with pay rise discussions.

"Pay discussions can sometimes lead to a conversation about career and development, and some employers will only give pay increases when people move into higher-level roles," Christie said.

Set a figure

Understand if the role has a prescribed level and pay band and front-foot the pay rise discussion with suggested dollar value or percentage increase, backed by research.

Kathleen McCudden, Group Human Resources Director at SEEK said that knowledge of current industry pay benchmarks will help people set realistic expectations for themselves and their employer.

"Search similar roles [that are] currently advertised [in your region and] use a salary tool to [check the] ballpark average salary for your industry and role type."

Although it may be unrealistic to expect a large pay rise unless something has changed, as every employer and circumstance is different, employees should provide research for their individual circumstances.

"You might get a bigger rise without changing role if there is a skills shortage for [that] type of role and the market value increases, if the responsibilities of the role have become greater, or if you joined at a lower salary while you were learning and you have gained more skills and expertise," Christie said.

Think wider than the back pocket

While money is important, employee benefits included as part of the remuneration package can help employees to feel valued - and can be brought up in the pay rise discussion.

"Talking to your manager about how you like to receive recognition, such as words of encouragement, public recognition of achievements, or the opportunity to be seconded to high-value projects can have greater positive impact on our long-term earning power and job fulfilment than a pay rise," McCudden said

Examples of wider benefits that an employer may be able to provide include insurance, a staff car park, wellness allowance, gym membership contributions and professional development courses.

Additionally, options that involve little or no cash outlay can be explored.

"Participation in special projects to build skills or exposure, or flexibility in the role or hours [are also common examples]," McCudden added.

Meeting 'do's and don'ts  

Having identified the right time and armed with 'why' and 'how much', Ruth Christie provides the following do's and don'ts for employees during the pay rise discussion.


  • Arrive prepared.  
  • Keep the conversation factual, not emotional.
  • Practice what you plan to say in advance.
  • Know your strengths and your development areas.
  • Remember that a pay rise isn't guaranteed. It's important to ask for what you want and be able to back it up, but you might not get it.


  • Make it emotional.
  • Threaten to resign if you don't get a pay rise.
  • Assume you'll get what you ask for.  
  • Think you're indispensable.
  • Forget that your manager may not be able to approve a pay rise without additional sign-off from someone else.

Handling a 'no' 

If the answer is no, take the opportunity to have an honest and open conversation about the reasons why.

"If the business [can't] afford it at this time, discuss the other benefits that could be included in your contract in lieu of financial remuneration," McCudden suggested.

Another option is for employees and their managers to set key performance indicators (KPIs) together to help set clear expectations of what success in the role looks like. 

"Scheduling a time down the track to revisit the [KPI's] is smart, as it gives you a target to work towards and a timeframe for your manager to be held accountable to," McCudden added.

Successful pay rise discussions are underpinned by preparation and professionalism. As a pay rise isn't guaranteed, employee benefits, training and new projects can increase job satisfaction and future prospects to help employees put their best foot forward.