– By Bob Cooper of Elite Worldwide

Before you start giving out raises for tenure alone, consider this: outside of raises that are based on an increase in the cost of living, all raises should be commensurate to the productivity of the employee. If you decide to give pay-raises as a way to reward loyalty, then be aware that you’re heading down a dangerous road. The employee will continue to get their raises for the same level of productivity, and before you know it you are paying them far more than what you would be paying someone else to do the same job (Airlines and many major US companies have fallen into this trap over the years). I’m not suggesting an employee shouldn’t be able to earn more money, because they should! The operative word is “earn.” So when an employee is up for their performance review, if it is clear that they are bringing a greater value to your company and if they have met your predetermined performance standards, then they should get the raise you agreed on because they’ve earned it. So sit down with each of your employees and discuss your expectations and what they will need to do to earn a higher income. Tenure alone should never cut it. Reward tenure with paid get-a-ways, tool credit, etc. Not raises.

For more tips on effective employee management, visit the Elite Worldwide website at www.EliteWorldwideStore.com.