Question

Dear HR Professionals,

My company currently is facing a very bad cash flow issue and one of my service support just pass his certificate to me indicating that he has completed his Diploma in Commerce (Marketing Management).

He joined us in July'17 and we have just adjusted his salary in Dec'17

Question here is do we need to adjust his Salary as currently he draw a salary of S$2K. with a transport allowance of S$450 (he drive motor bike).

How much should we adjust and if we adjust his salary right now, our cash position will be very tough.

Thank you

Karen

Reply 1

If your company has a policy of granting salary increment for passing examination, then it may be crucial to discuss with management on when and how much increment is appropriate. The amount to adjust depends on type of industry. Based on my experience, the adjustment range can vary from $50 to $300.

If your company does not have a policy to adjust employee’s salary when they pass an exam, then the additional academic achievement, if relevant to the job, may be taken into consideration during annual salary adjustment exercise.

Lam

Reply 2

In my view, you should think about the job. According the job description how much should the company pay for. Then based on this person’s performance and other expectation from the supervisor. Education certificate is not the only measurement.

Selina

Reply 3

Is there a psychological contract or company policy that states salary increment will be awarded to staff who upgrade their qualification? Or is there an existing culture being practiced? If there is, then the company should be consistent in their internal practice, subject to financial performance and annual budget allocation for salary.

If there is no such policy, and assuming staff current salary falls within his designation's salary scale, I would suggest for salary increment to take place after the year's annual performance appraisal exercise. His salary increment may then factor in his annual performance as well as his new qualification attained.

Azirah

Reply 4

Salary adjustment is done based on the salary structure. If your salary structure has been changed and you need to adjust the staff salaries based on the approved new salary structure you should follow the relevant grades and steps.

In case if you are adjusting a position which is not fitting in your current scale. You need to adjust it as per your salary structure i.e. grades and steps. Most of the organization in our country think of the increment for the staff and not bringing their wages down but in minor cases the wages may be decreased just for the salary adjustment issue to ensure all salaries are in alignment with the approved salary scale.

Daudzai

Reply 5

Go with the batch review like annual staff appraisal would be better. I understand your worries of losing this talent if the increment exercise is done late. Actually if he is ‘worthwhile the urgency’, his dept head could actually make the adjustment recommendation. I myself do not second immediate gratification with each new cert a person grabs.

Ddksw

Reply 6

It depends on your company’s compensation philosophy, whether the employee will be eligible to get a salary increment after obtaining a diploma. Salaries should be aligned with the job requirement; if a diploma is not needed for his current role, and there is no change in job scope even after obtaining his diploma, then a salary increase doesn’t seem justified.

Doreen