Our BSC mastermind group recently hosted a Q&A webinar where our 75 members submitted questions. One of the questions we received – and one I’ve long wrestled with – was this: “Should cleaner pay be increased with each successive year of employment, even when the customer price hasn’t been increased?” There are several tensions at play here. First and foremost, treating our employees fairly is an absolute must. Second, we want and need our team members to stick around. The longer they stay, the better. Finally, the company must make a certain level of profit to maintain stability and provide for future growth. So how do we balance these varying tensions pulling at us? Here are five thoughts on the matter.
Bid your jobs appropriately
The first step in dealing with a problem is trying to prevent the problem from arising in the first place. In the case of cleaner pay rates, the best way to prevent stagnant wages is to bid your jobs with enough margin to make room for pay increases along the way.
Don’t start the pay too high
A common mistake many of us make is starting our team members at the maximum wage built into the budget. While this may help staff the job at the beginning, it creates inevitable tension on the back end when you have no room for pay advancement. To prevent this problem, try to start wages $0.25 to $1.00 per hour lower than the budget, giving yourself room for raises in the coming years.
Strive for regular price increases
While not always possible, your company should strive to make regular price increases a part of every customer relationship. This can be done in one of two ways. First, you can build price increases into the contract. Some customers expect price increases, and when you build them into the contract, you give the customer an expectation of what the coming years will look like. Another way to handle price increases is on a case-by-case basis. As you renew contracts, discuss the need to increase worker wages and negotiate accordingly.
Realize that every job has a cap
When cleaners are asking for pay increases, sometimes we can get frustrated, but other times we can totally understand their desire. If they’ve been doing a great job for an extended period of time, we want to reward them. However, it is important for both you and the team member to realize that all jobs have a ceiling. Instead of just telling the cleaner “no,” you should coach them on the reality of how value is added to the organization. This can often be the launching pad from which they grow in their skill set.
Consider non-pay incentives
Finally, when pay increases are not an option (for whatever reason), you and your management team should spend a considerable effort to offer non-pay incentives to your team. Pizza parties, awards, recognition, training, time off, and other incentives can really boost moral and minimize the pay concern.