Q: “I have employees who have been with me for quite a while and I’d like to give them raises, but I can’t afford a higher payroll. What are my options?”

A: It’s been years since employees realized a noticeable increase in wages. Unfortunately, those 1 percent to 3 percent increases are just as likely to shift your employees to a higher tax bracket, so their paychecks end up shrinking. As companies have struggled to survive the past seven years, employees are also struggling to live on static wages.

Giving an employee a raise has a rippling financial effect. Your payroll taxes and your workers’ compensation insurance premium will go up because they are based on overall payroll. It’s also hard to reduce those wages if hard times return. You can do it legally, but it’s hard to retain employees when a pay cut is necessary.

Now is the time to think about other options. Perks have always been standard in management positions, and it’s time to consider what perks you might implement for the rest of your staff. This is becoming a popular method for rewarding employees when raising wages isn’t an option.

Here are a few possible perks to consider:
• If you don’t offer any paid vacation time, develop a bonus program that rewards employees with paid days off instead of cash.
• Give an occasional discretionary bonus. Even if it equals what they might earn with a pay raise, it still costs you less overall.
• Cover a higher percentage of health insurance premiums or add an additional insurance.
• Pay for a gym membership.
• Provide commuting subsidies.
• Create a monthly bonus plan where they can choose their bonus from a group of items you have available. These are typically items for personal use, ranging from a $25 gift card for a local restaurant to an electric toothbrush.
• Provide tuition reimbursement if your company encourages continued education.
• Add paternity leave if your employees are family-oriented.
• Award $25 to $100 gift cards for outstanding performance.
• I know a company that provides a turkey and a $300 grocery store card just before the holidays.
• Add another holiday just for this year.
• Arrange for a dry cleaner to come to your facility to pick up and drop off cleaning.

Deciding which perks to offer is a matter of testing to see what works best and will be most appreciated by your employees. Just because you love a particular perk doesn’t mean they will. Make sure this is a positive experience for them.


About Your Columnist

CJ Westrick is a featured columnist for Women Taking Charge, the official blog of Connected Women of Influence, where she covers all things human resources and managing people in the workplace. CJ Westrick, SPHR, has been in human resources (HR) management for over 20 years and has maintained her SPHR (Senior Professional in Human Resources) national certification since 2002. She started HR Jungle, a human resources consulting firm, in 2006 to provide senior-level HR expertise to businesses without internal HR.’


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