A promotion doesn’t automatically mean a bigger pay cheque for those working in Hong Kong, according to the findings from a research by specialised recruitment company Robert Half, which found that only 1% of Hong Kong CFOs always give a salary increase when promoting an employee.
Six in ten Hong Kong finance leaders say the primary reason for promoting an employee without attributing a corresponding salary increase is because they want to assess an employee’s performance first before remuneration is increased.
Meanwhile, just under a third of respondents (28 percent) feel their business lacks the financial resources to increase salaries, followed by 7 percent who say they are urgently needed to fill the role.
Adam Johnston, Managing Director, Robert Half Hong Kong said: “A promotion is always a clear sign of confidence in an employee, but without a corresponding salary increase it has the potential to negatively impact an employee’s motivation and ultimately influence their decision to look for another job.”
“Hong Kong’s tight labour market and low unemployment rate makes it essential for companies to reward top performers through career advancement opportunities. However, a competitive salary package is a very effective retention tool, and many employees are prepared to work hard if they are confident of being rewarded by a higher salary or bonus.”
In circumstances where a promotion doesn’t go hand in hand with a pay rise, it is vital to explain the reasons why, as well as discuss exactly what an employee needs to do to make that salary increase happen.
Primary reason for promoting an employee without a corresponding pay rise
|Employee performance needs to be assessed first
|Lack of financial resources
|The job had to be filled urgently
|Remuneration was too high for previous position
|We always promote with a corresponding pay rise
Source: Independent survey commissioned by Robert Half among 100 Hong Kong CFOs and finance directors.
Johnston concludes: “Employees who receive a promotion without salary increase should consider negotiating non-financial benefits like flexible working hours or options to telecommute. It’s also worth bearing in mind that taking on a more senior role can be instrumental to long term career advancement, which can compensate for missing out on a pay rise in the short term.”