When a business begins to grow, you’re going through some exciting times. Finally after all your hard work, you are seeing some tangible growth. It’s not just profits and revenue spikes on a graph chart, you are having to hire more and more employees to keep up with demand. Pretty soon you’ll be expanding to a new office building and then you will arrive one morning to a packed out office to noise and fervour. What happens to many companies during this time, is the ‘hire now and think later’ syndrome. It begins with the urgent need to fill the ranks with fresh minds and new blood. So you hire the best talent you can, as quickly as you can. You will be concerned about who is being paid what salary and for how long later when the dust settles. Yet, it never gets seen to. Slowly but surely, you will begin to realize that you’re paying certain people too much. Employee salaries and bonuses are a massive expenditure in a business, so don’t overlook this.

Does rank justify pay?

This question has been wrestled over by some of the top CEOs in the world. Does the rank of an employee warrant a certain salary level and bonus agreement type? Does a c-suite rank employee automatically deserve a six figure salary, or should you judge them by their performance? This can mean that you have to entice employees by their bonuses and not by their salary. For example, their base and guaranteed salary is $50,000 a year with a 2% rise year on year. But, their bonuses for hitting deadlines and meeting quality standards can be $100,000. Essentially, you’re willing them to work harder and longer for their pay. On the flip side, employees won’t feel secure and this can cause panic to the point that they will leave their roles. So think carefully if you should offer a bonus-heavy style contract to an employee that doesn’t work as hard and a high salary to those that already do.

Who’s in need of increasing?

Employees won’t tell you they’re upset with their salary, they will brood and brood to the point that they will just leave. Many employees that don’t get their deserved pay increases will start to look for other work behind your back. They won’t tell you, they’ll just go. So use payroll service providers that can show you what each employee is being paid right now and for how long. When an employee has shown they are a hard worker over the years, you are less likely to forget they are due for an increase in salary level. Avoiding disgruntled employees just by paying them more for their continued hard work and loyalty can save your business from serious internal decline. It’s also great for surprise promotions as you can track each increase over time and consider increasing their rank and role in your business too.

Employees are a huge chunk of your revenue every year. Paying their salaries and bonuses should not be done nonchalantly. Use a payroll service to keep an accurate eye on who really deserves what they are getting.