Motivating in a pay freeze

Over the past ten years thousands of organisations in both the public and private sectors have imposed pay freezes on their staff. The aim is to improve bottom line results by capping fixed costs. The negative side of a pay freeze is that employee motivation can take a nose dive and the organisation can end up losing valuable employees, so the question is….how can you motivate your team in a pay freeze?

The first thing to do is find out the reason for the pay freeze and the length of time you can expect it to be in force. Take the time to explain the purpose and time frame to your team, so they can understand the pressure the business is facing as well as how long they may need to wait without an increase in their remuneration.

Next look for potential flight risks. These could be the people who are most motivated by money, and/or those who genuinely believe their financial rewards are not ‘fair’ for their role. Discuss with your superiors the possibility of a pay adjustment for these people and remember to point out how much more it will cost in terms of recruitment and possible loss of income if they are high performers within the business. Pay freeze does not always mean a complete freeze.

Another option is to look at alternative ways of compensating your workers, such as greater flexibility in working hours, home working or additional holiday time. For many people these could work just as effectively as financial rewards.

Finally remember that not everyone is motivated by money. For many of your employees other factors will be more important to them, such as job stability, working as part of a strong team or creative problem solving. As long as their salary meets their basic living needs they will stay if their other motivators are satisfied.

The key here is to make sure you understand what motivates each member of your team, and to manage their motivation pro-actively so you can ensure their needs are being met. Small changes really can make a big difference, so make sure you explore all avenues rather than assuming there is nothing you can do.