How often should your company give raises?

Employee raises should be handled with consideration.

Employee raises should be handled with consideration.

What employee doesn't want a raise? Raises can be a great way to reward employees for doing great work. It has the potential to lead to increased job satisfaction as receiving a raise may make workers feel more valued.

An Inc. article discusses the trend of employers handing out smaller raises multiple times each year. While this might sound like a good idea, the article brings it into question, noting that in practice it may be difficult to sustain. 

Most people want to be paid well. It's nice to be rewarded for the time and effort that goes into doing a great job at work. However, just because you give your employees frequent raises, it does not mean that gesture will automatically translate into being happy at work. As Inc. points out "assuming pay equals happiness" can be a mistake.

As HR is responsible for attracting and retaining talented workers, as well as payroll concerns, raises are an important consideration. If an employee is truly unhappy at their job, a raise in and of itself will not be a solution, only a temporary fix. Employees that are too stressed out or frustrated with a work situation may begin to look for another job, and as HR departments know, the cost of finding, hiring and training a replacement can be significant. 

If you do intend to hand out multiple raises, there are numerous considerations to account for, including being sure that the amount of the raise is reflective of performance and noticeable enough to make a difference. HR software solutions can develop the system that will help you company track and manage important payroll details.