Promotions come without salary increases: Survey

by HRD19 Oct 2016
A recent survey conducted by recruitment firm Robert Half found that “a pay raise after a promotion is more likely to be the exception rather than the rule”.

In a survey of 100 chief financial officers and finance directors in Singapore, only 17% of companies guarantee a salary increase with a promotion.

In terms of company size, medium-sized companies that have between 150 to 499 staff were the ones more likely to give a pay raise while only 15% of small and large companies said the same.

Forty-three per cent of those surveyed said that the “main reason for not attaching a salary increase to a promotion is because they want to assess an employee’s performance first,” said a report by AsiaOne Business News.

Another 22% cited lack of financial resources while 11% said that there was just an urgent need to fill the position.

“Interestingly, 7% of firms stated that they did not raise the salary of a promoted employee because their remuneration was already too high for the previous position,” added the report.

Matthieu Imbert-Bouchard, managing director at Robert Half Singapore, advised companies not to discount the effectiveness of a salary increase as a retention tool.

“While receiving a promotion is a clear sign of confidence in an employee, taking on a more senior role and more responsibilities without getting a salary increase can negatively impact an employee's motivation which in turn can influence their decision to change jobs," he cautioned.

“When employees don't receive a salary increase when promoted, it is vital to explain the reason, as well as potential targets that the employee needs to reach within a certain timeframe in order to receive a salary rise.”

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