With inflation currently at about 4.5%, should companies give their employees annual pay rises to at least match this so that their workers are not getting effectively poorer every year?
Do your company pay schemes give inflationary annual pay rises whether performance-related or otherwise?
2007-12-07 07:17:07 · 13 answers · asked by jj 3 in Business & Finance ➔ Corporations
Yes, I can see the point that small companies would struggle. I'm really directing this question at larger companies with million or billion dollar turnovers - anyone work for such a company? Do they give performance-related inflation-busting pay rises?
2007-12-07 07:35:40 · update #1
I think it should be performance driven, not driven by outside factors. If you keep ratcheting up salaries to meet inflation, that by itself helps "inflate" things even more.
No free lunches, pay on performance.
2007-12-07 07:20:39 · answer #1 · answered by gato_del_sol_3 4 · 1⤊ 1⤋
Companies give raises when they are afraid their employees might quit and go find another job.
They do not give raises when they cannot afford to.
Corporate executives should be required to get approval from shareholders before giving themselves raises.
Many employees own stock in their company.
The employees who own the company stock would be more willing to give the executives a raise if they received a raise first.
Ron Paul wants to stop inflation by taking some powers away from the Federal Reserve.
He is a Republican candidate for President.
He talks more about stopping inflation than any of the other candidates.
2007-12-11 06:26:04 · answer #2 · answered by Eric Inri 6 · 0⤊ 0⤋
This question has been thrown around since the Industrial Revolution. Companies should reward their employees appropriately, and especially in recognition of hard work. The award should not come automatically, and should not be of a size which will eventually mean layoffs because of failing returns.
Probably the best arrangement is an employee ownership, like John Lewis, where the employees work towards a known objective, and get rewarded accordingly.
2007-12-07 07:25:52 · answer #3 · answered by Anonymous · 0⤊ 0⤋
It would be nice but it is related to company performance. Wages and salaries are a major cost in any business and if the total goes too high it will make the company uncompetitive, loose market share and effect staff numbers. It therefore has to be a trade between inflation, efficiency and industry standards rates.
2007-12-07 21:11:54 · answer #4 · answered by Barbarian 5 · 0⤊ 0⤋
Afraid not. They are only obliged to pay you national minimum wage which does normally increase every October. Otherwise you are only entitled to a pay rise if your contract of employment gives you this right or if you have always had a pay rise in the past and you can prove that this is now a right through custom and practise.
2016-05-22 01:08:50 · answer #5 · answered by ? 3 · 0⤊ 0⤋
The problem with that approach is that you never get a real-terms increase, you are effectively having your pay frozen.
Pay rises should at least match inflation, otherwise it is effectively a pay cut. To get higher pay rises we need more union membership and collective bargaining agreements. And a higher minimum wage.
Another way of combatting low pay is to quit your job for a better one. Companies think again when staff are hard to keep.
2007-12-07 07:20:44 · answer #6 · answered by Phil McCracken 5 · 1⤊ 1⤋
Nice thought and the augment is used by unions. But every dictator raises wages by 100% and then blames everyone else for inflation
2007-12-08 06:30:20 · answer #7 · answered by Scouse 7 · 0⤊ 0⤋
we have minimum wage so they have to conform to that. but as a worker on minimum pay i am with the companies. the staff have been reduced from five to just me. i am having to work harder for my money knowing that the business could go under any day due to increases in inflation. workers have less money to spend but the business still has bills to pay which have also increased. its a no win situation. we asked for minimum wage and got higher prices and less hours work... hence less money overall. catch 22.
2007-12-07 07:24:33 · answer #8 · answered by samjo 2 · 0⤊ 0⤋
No because small companies sometimes just cannot absorb the cost at a particular time and may go out of business, resulting in everyone being out of work.
2007-12-07 07:28:35 · answer #9 · answered by resignedtolife 6 · 0⤊ 0⤋
yes, and as someone pointed out on here just now, the real cost of goods is way more than inflation, ie travel goes up by 15%, council tax by about 10% etc etc
2007-12-07 07:20:17 · answer #10 · answered by Anonymous · 1⤊ 0⤋