Why It’s Cheaper To Pay You More

My client recently sent me a whatsapp message, after she had handed in her resignation a few weeks prior. That resignation came at the back of having been denied a long overdue salary adjustment:

“I just found out that my role will be taken over and divided by 2 people because they have reached the conclusion that one person cannot handle it alone. It made me laugh, because at the end it will cost them more anyway.”

I hear this over and over again from clients and others: they leave their current company because they found another organisation that values their work more, and then the original company needs to replace them with two people. Or three. Or more.

This is obviously terrible for the company’s bottom line. Paying two or more people to do the original job will very likely be more expensive than giving your one employee a salary raise.

And even just replacing someone with one other person is expensive.

The research varies, but on average it costs between 200 – 400% of an employee’s annual salary to replace that person, in recruitment, onboarding, lost network, etc. For more information, watch my TEDx talk on that exact subject here.

But besides the cost savings, I have found something interesting after having guided hundreds of women intensively in their career processes.

When a woman feels valued and empowered, as achieved at least in part by receiving a fair (or dare I say it: great) salary for the value that she brings, there’s an energy that is released within her, that will blow you away. The results that this energy, coupled with inspiration and commitment, brings to the company, will far outweigh the raise needed to get to that point.

So if you’re a leader in a company: please do me a favour and reconsider that salary raise request you received from your employee. Or if you are an employee in dire need of a raise: ask for it. Not because it’s the nice thing to do, but because it’s the SMART thing to do.

If you want help lowering employee attrition + unleashing that potential in your organisation, send me a message. If you are an employee and you want help negotiating a pay rise or promotion, PM me too. It’s what WIN is all about.