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When Is a Salary Raise Justified?

Pay raises happen for a variety of reasons, such as through policy, contracts, cost of living and, often, just asking. "There are two sides to the pay raise story," says Monica Richter, a human resources director in Toronto. "Your justifications may be valid, but your company may not be in a position to meet your request, so the timing is off. However, your salary follows you through your career. Treating salary increases as a process, rather than events, may improve your satisfaction with how your pay evolves."

RELATED: How to Make the Case for Higher Pay

Company-Based Raises

Increases based on policies aren't exactly justifications, but in some companies with thorough guidelines or tight union collective bargaining agreements, following an established road map may be your only way to an increase. "It's important to know what increases are structured into your job and your company," says Richter. "Your boss probably isn't thinking about your salary as he goes about his daily work, so if you've reached a company threshold, it's fair game to bring it up with him." Richter suggests consulting your boss even if your company supports direct contact with the human resources department in such cases. "Keeping him informed is a courtesy that supports communication," she says.

Performance Appraisals

Annual increases are often tied to performance appraisals, but making your case with your boss may be too late, says Richter. "A fiscally responsible company may request salary estimates months ahead of your review. By the time you meet with your boss, your increase may already be set and approved." Career coach Lee E. Miller, writing for the website The Ladders, agrees. He suggests building your case and approaching your boss months ahead of reviews so that you can be heard in time to make a difference. Even better if you know when budgets are due, says Richter. Discussing your salary raise justification in advance of budgets may help your manager with the budget process, she says.

Salary Inequities

In a 2011 story in CBS News.com, human resources writer Suzanne Lucas describes situations in which new hires come in to a company at higher salaries than existing employees, a common occurrence in the contemporary workplace. This can lead to sizable inequities in the salary scale. If your company hasn't kept pace with competitors, you may also find yourself working for less that your value on the open market. "When you discover a big difference between your salary and what others doing the same job are making, approach your boss about correcting your salary, not raising it," says Richter. "The distinction is important, since a raise may have informal limits. Adjusting your salary closer to market value may be more palatable to the company than an out-of-the-ordinary raise."

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Making Your Case

No matter what justification you have for a salary increase, how you approach your boss has much to do with the success of your request. As Tara Siegel Bernard writes in The New York Times.com, ultimatums and threats are counterproductive. Richter agrees. "Even if you're successful this time, you suggest that your needs come before the company." You should be prepared for rejection, Bernard says. A "no" answer today may set the wheels in motion for success down the line. You've opened the dialogue with your boss, and you can gain valuable insight into how to build your worth -- and your future raise -- proactively.

Photo via monkeybusinessimages/iStock/Getty Images

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