How can I keep my star employee without paying him more?

If your finances don’t allow for pay raises, find out what benefits or perks your employee might want instead

A veterinary practice owner writes:

I have an absolutely fantastic vet tech who has been with us for just under two years. He has almost 10 years experience, all in large, reputable hospitals. He was impressive during his interview, but during his time with us, he has exceeded all my expectations.
 In addition to his flawless technical skills, he has a great attitude, is reliable, an excellent team player and repeatedly goes above and beyond for clients and patients.

At the time of his annual performance review, almost a year ago, I gave him a pay rise — and lots of praise!

It’s now almost time for the review again, and unfortunately, I am not able to offer him a pay raise. There is no doubt in my mind that he deserves it — it’s simply that the business is not in a financial situation at the moment where that would be possible.
 He is involved with industry associations and is a great networker, so I suspect it’s only a matter of time before someone else realizes how amazing he is and makes a better offer.

I don’t want to lose him — what can I do to keep him around, without paying him more?

I think you need to have an honest conversation with him and try to explain all of this to him. Conduct the performance review as per normal and give him lots of specific examples in his feedback, even if they are all positive.

A few specific points I would address with him, in this order:

Ensure he understands he is an extremely valuable member of the team.

Don’t assume that he knows this. Even if he does, it’s always nice to hear that you are valued and needed. It’s important that you are genuine in telling him this — don’t sound patronizing and like you’re just saying what you think he wants to hear.

He needs to know that he deserves a pay raise.

Knowing you’re valued and hearing your manager say “you deserve a pay raise” are not the same thing. The latter is very powerful and puts you both on the same page — he probably feels like he deserves one, too! Let him know that you would like nothing more than to give him a pay rise.

Presumably, if you can’t offer your star employee a pay raise, no one else is getting one either?

If this isn’t the case, it should be. Pay raises should be tied to performance, and if he is the star performer in your team, he should be first in line. Let him know that you’re not able to give anyone on the team a pay rise now (provided this is true, of course).

Share your hospital’s financial information with him.

I’m a big believer in sharing P&L’s with the entire team, so if you’re already doing this, it may not come as a surprise to anyone that there is no money for wage increases. If you’re not already doing this, this is the perfect opportunity to start. It validates what you’re saying and helps him understand where all the money he is seeing come into the practice is going.

Acknowledge that you do not want to lose him, but understand that he may get better offers.

This is ultimately your concern, right? It’s probably the most genuine thing you can tell him. This builds trust and loyalty, and I don’t know about you, but I have stayed in positions in the past because I felt a strong sense of loyalty to my employer.

Discuss what else you may be able to offer him instead.

This is where you start to look for a solution together. Research has shown that financial compensation is not even in the top five reasons employees are engaged in the workplace and remain with an employer.

Talk to him about his goals.

If you simply ask him, “So, what else can I offer you instead,” you probably won’t get anywhere. Instead, try asking what his goals are, both personal and professional, and this will give you some ideas and get the conversation started in a positive direction.
 Here are some examples: His personal goals may be to spend more time with his young family. Can you offer him a more flexible schedule or some time off?
 His professional goals may be a certification or other professional development. Maybe he even has a specific role he would like to take on in the future. Can you offer him additional CE allowance? What about a promotion, with a new title and a career path?

Let him know when the next salary review is.

Finally, don’t keep him hanging. Let him know when you will sit down with him again to review the P&L and revisit the possibility of a pay rise. Better yet, set some clear, financial metrics that will signal you can afford to increase his wages. Is there anything he can do to directly influence this? For example, sell more wellness plans?

Good people eventually leave if they are not being fairly compensated. You can have the above conversation with him once, maybe twice, but be prepared for his departure if you’re not eventually able to put your money where your mouth is.


Want to submit a HR question of your own? Send it to hr@consultmates.com.

Consultmates is a global marketplace for practice management. We connect veterinary practice owners with practice management experts, without the cost and hassle of annual contracts. Browse top consulting talent on demand, with transparent, Pay-As-You-Go hourly fees.

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