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My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:20 pm
by Elsebet
Hi all, thank you as always for your great advice.

I am looking for some words of wisdom to console what I feel is a bit of a let-down at work. I'm 41 and have worked in IT for my MegaCorp for 4 years now. The first two years I was here I had terrible managers and left both teams (the second team was disbanded soon after I left). I've been on my current team for two years and the manager and senior members of the team really like my work. I work hard and strive to be a high performer. Last year I received a really low raise, my lowest in my entire career, even when I had a great year. My boss was apologetic and explained that I had reached the top salary for my grade and therefore he couldn't give me a higher raise until I was promoted. It took until yesterday (almost a year) for my promotion to go through but I received no increase in salary. My manager I feel is genuinely upset about not being able to give me any more money with the promotion, but he says I can now get the usual 2-3% raise per year now that I'm no longer capped.

We do not get any bonus or RSU's, the only increase I can get is either promotion or the annual raise. Since I didn't get any increase for my promotion I am stuck waiting for the annual increases and hoping I get close to 3%. I feel like there is little point to working hard at this job if I'm going to get a similar increase to those who just put in the bare minimum. Yes, I am thankful to have a good job, manager, and team. It's just disappointing to not be financially rewarded for going above and beyond. I am trying to focus on the intangibles like the work-life balance (which is I'd say TOO good and delays work), an easy commute, and a solid team. However I live in an HCOL area (Seattle) and my property tax goes up a lot each year, nullifying much of my raises.

I intend to work until 59.5 and I'm aware of the ageism issues, so jumping ship right now might not be the best idea. I do not NEED more money; I make a good salary, max my retirement funds, and we keep our expenses low. At our current pace/savings we should be fine when I'm 59.5. My company will not allow my manager to give things like extra vacation in lieu of an increase, I already asked for that and was declined.

Any advice for a good mindset to have in this situation? At all of my other companies I was well rewarded financially for being a high performer and it's hard adjusting to this new reality.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:26 pm
by lthenderson
No real words of wisdom other than to say, been there, done that. My best pay raises were always when I switched companies or threatened to leave a company. Smaller companies seemed to reward hard work more than large megacorps where you are just a numbered resource. At the end of the day, if it becomes a big enough issue you can't sleep at night, I would suggest looking elsewhere. If you really like it where you are at, you might be able to use another job offer to leverage yourself a raise... or leverage yourself out the door. I've done both.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:33 pm
by fabdog
based on what you wrote, it sounds like you are very highly paid vs how they have you placed in their compensation structure... you were "topped out" in your position before the promo (based on boss comment you had reached the top of the pay range). If you hadn't been a good/great performer the raise would have likely been a zero.

To get a promo to the next grade level and no raise with it means you are pretty highly paid in that range as well (the pay bands likely have a lot of overlap) and with his mention of now you could get a more standard raise you're likely still over the mid point of that grade.

Do your annual reviews or the promo come with any documents that show your pay range and how that lines up against your current salary? Say it says you got 1% raise and salary is now 79,700 and your pay range is $70K to $80K? Or after promo you now make $79,700 and you range is $74K to $84K?

Did you get a large raise when you joined this firm? Ask you boss if you can see the pay scales... what would it take to get moved up another level?
Or as noted.. explore what other companies are willing to pay for your skill set

Mike

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:34 pm
by N10sive
lthenderson wrote:
Thu Sep 28, 2017 2:26 pm
No real words of wisdom other than to say, been there, done that. My best pay raises were always when I switched companies or threatened to leave a company. Smaller companies seemed to reward hard work more than large megacorps where you are just a numbered resource. At the end of the day, if it becomes a big enough issue you can't sleep at night, I would suggest looking elsewhere. If you really like it where you are at, you might be able to use another job offer to leverage yourself a raise... or leverage yourself out the door. I've done both.
I believe most people experience this and recently I was in this exact scenario. I had gotten a promotion to put on my business card but not a raise. Around 8 months passed and I decided to leave with offer in hand. Got a 25% raise offer. Decided to stay until a job opportunity came up with similar pay but a company I wanted to work for. Ended up getting another 15% raise offer, even more than the company I was looking at but decided not to stay. Pretty much got a 40% raise offer within 4 months. I wish I would have tried to leave a lot sooner, the second raise just left a bad taste in my mouth as in they just never wanted to pay me what I was worth, so I left. I left a lot of money on the table during those month and even years previously not asking for a raise. This was a small company though, not a megacrop. I am in I guess a megacrop which I believe if I were to try this it wouldn't go the same way.

Now how to go about that is going to be tricky. Ill let others give advice on that.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:36 pm
by Steve723
Yes, I can see why you are disappointed. I'm a little surprised that MegaCorp has no bonus or equity program, as often times a promotion can lead to a larger total rewards package, even if one component (such as base in your case) isn't uplifted.

That being said, if what your company says is true, and you truly are at the top end of your pay range, then aren't you already being fairly compensated and differentiated from those that perhaps have fewer skills/lower performance levels than you?

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:37 pm
by bottlecap
When is the next annual increase? If in January, I wouldn't sweat it. If your manager is on your side, perhaps the manager will advocate a bigger (or the biggest the company can give) annual increase come Jan due to the circumstances.

But realize this is the operative word: Megacorp.

You likely get a higher salary than those in small outfits, but in exchange, you salary is adjusted by a bureaucratic formula, not by economic justice. If you aren't willing to leave, from the higher up's prospective, what incentive do they have to pay you more than they have to?

Good luck and, in any event, congrats on the promotion.

JT

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:45 pm
by random_walker_77
Elsebet wrote:
Thu Sep 28, 2017 2:20 pm
Yes, I am thankful to have a good job, manager, and team. It's just disappointing to not be financially rewarded for going above and beyond. I am trying to focus on the intangibles like the work-life balance (which is I'd say TOO good and delays work), an easy commute, and a solid team.
Keep in mind that inflation runs about 2%, so you'd really like to see 2% just to break even.

You've got some good things going here, which I've bolded. A job with a horrible manager/team can be soul-sucking and unsustainable even with really high compensation.

Does your promotion make you more marketable to other companies? Or increase your market worth after you gain some experience at the new position?

There's little downside to floating your resume to see what market compensation is at. When you're happy with your job, it's also easier to negotiate harder to see if another position would make it worth your while to leave your current job.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:47 pm
by jabberwockOG
What you earn is based on what you are worth in your local market. Getting that rate takes some work and not taking your current employer's "no" for an answer. The dirty little secret is that employers (even at megacorp) hand out big raises and stock options all the time to valuable employees who have job offers in hand while the rest of the workforce gets very little. This "exception" process is kept very quiet for obvious reasons.

Polish up your resume and do a little networking. If you have valuable skills and you are actually underpaid relative to your local market you will soon have one or more outside job offers with higher salary.

Once you have a valid job offer in hand take that to your manager and tell them that you want to stay with them but they need to come up with a salary/stock/benefit increase that comes close to matching or exceeding your offer. If you manager truly values your skills/contribution they can easily take the job offer to HR and get a salary increase and hopefully a match or exceed.

Most managers will respect an employee that requires compensation that matches with their skill-set and value to the market. Making that happen does require some work and some risk. Usually only the deadwood accept terrible raises and empty promotions.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:49 pm
by denovo
Here's my advice. Everyone thinks they are unpaid. The way you'll find if you really are is if you look for work in another company and find out if they will pay you more for similar work. There's probably no point in arguing with your bosses for money. Looking for new work is hard, but that's really the only way.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:50 pm
by KlangFool
OP,

I had been in the same pay range for the last 10+ years.

A) Enjoy your life! Appreciate your work-life balance. Put in enough hours for the high priority stuff. The rest just let it slides.

B) Your pay raise will be on your investment from now on. There will be a point when you will laugh at the bonus and/or pay raise that you get. You will smile say "thank you" to your boss. But, in the back of my mind, you will say thank goodness that I am not counting on this money.

C) You are in a good place in life. Please note that the extra hours you spend on the employer would not be financially rewarded.

<<However I live in an HCOL area (Seattle) and my property tax goes up a lot each year, nullifying much of my raises.>>

D) Do you get pay enough to stay at this area? This is one of the questions that you have to answer.

KlangFool

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 2:58 pm
by CaliJim
As a stock holder (via VTI): I think your pay is just fine, in fact, maybe you are overpaid. :twisted:

As a fellow human being, and as others have said: you are free to try to sell your services elsewhere.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 3:34 pm
by Watty
The part that is missing from your post is how your salary compares to what you could be making somewhere else. The percentage changes each year don't make a lot of difference if that is what you market value is.

Any career has peak earning years that are often when people are around 50 but my impression is that in IT people have their peak earnings much earlier than that.

https://en.wikipedia.org/wiki/Peak_earning_years

I retired out of corporate IT as a software developer when I was 58 and for the last ten years I was basically doing the same job and at the top of what that skillset would pay so I was doing good to get an inflation adjustment each year. I was still well paid but adjusted for inflation I was making less when I was 58 than I made when I was 48.

Part of that was that I did not have the right personality to go into management and the few times I tired that I hated it. Early in my career I made the decision to stay on the hands on technical side of things which limited my advancement potential, that was the right choice for me since I was able to work as long as wanted to.

One other concern is that meager raises can be a sign that the company or your group is not doing very well and your job may not be secure.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 3:45 pm
by mdavis6890
Stop waiting for your company to pay you more and take control of the situation. Whether you like where you work or not - shop around. Go on a few interviews. Ask about comp, schedule, benefits and such. Maybe it'll make you grateful for the job you already have. Or not. Maybe you WILL find a better place to be. Anyway, you'll be taking control of your life instead of waiting for someone to give you something.

Thoughts:
- Why did you accept a promotion without a raise, or at least having that conversation?
- How much you can make at a company is not just based on how good you are - it's based on a lot of other things including the overall revenue per employee that company has. Companies with high revenue/employee can pay more, as can companies that are growing and performing well overall. A lot of this has nothing to do with you.
- IT is always a cost to the business and is ALWAYS fighting for dollars. The CIO himself will be begging for budget. Consider moving into a different related field, like maybe devops or technical sales where companies are "investing" money instead of "spending" it.
- Contrary to what others have suggested, I do NOT suggest that you try to leverage another offer against your company and plan to stay there. Doing so will often put you in a bad position. The company will then start pressuring you for more work/results and probably consider you a flight risk that they will want to replace. If you do get another offer that you would take, then just leave gracefully and hope that you all get to work together again soon. Maybe you will.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 3:48 pm
by KlangFool
mdavis6890 wrote:
Thu Sep 28, 2017 3:45 pm
Stop waiting for your company to pay you more and take control of the situation. Whether you like where you work or not - shop around. Go on a few interviews. Ask about comp, schedule, benefits and such. Maybe it'll make you grateful for the job you already have. Or not. Maybe you WILL find a better place to be. Anyway, you'll be taking control of your life instead of waiting for someone to give you something.

Thoughts:
- Why did you accept a promotion without a raise, or at least having that conversation?
- How much you can make at a company is not just based on how good you are - it's based on a lot of other things including the overall revenue per employee that company has. Companies with high revenue/employee can pay more, as can companies that are growing and performing well overall. A lot of this has nothing to do with you.
- IT is always a cost to the business and is ALWAYS fighting for dollars. The CIO himself will be begging for budget. Consider moving into a different related field, like maybe devops or technical sales where companies are "investing" money instead of "spending" it.
- Contrary to what others have suggested, I do NOT suggest that you try to leverage another offer against your company and plan to stay there. Doing so will often put you in a bad position. The company will then start pressuring you for more work/results and probably consider you a flight risk that they will want to replace. If you do get another offer that you would take, then just leave gracefully and hope that you all get to work together again soon. Maybe you will.
mdavis6890,

<<- IT is always a cost to the business and is ALWAYS fighting for dollars. The CIO himself will be begging for budget. >>

That statement is not true if the employer is an IT vendor/supplier. In that case, IT is a revenue/profit generator.

KlangFool

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 3:53 pm
by Pacman
Hi Elsebet - I've worked with people like you in the sense that they were high performing but received minimal raises each year. In each of the cases, I think management viewed them as 'low flight risk' & 'comfortable' so didn't feel the need to allocate more money to them. Instead, the money went to assertive people who would be confident enough to jump ship if management didn't recognize their contributions. Not saying this is you; but just my observations in the corporate finance/accounting world.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 3:54 pm
by mdavis6890
mdavis6890,

<<- IT is always a cost to the business and is ALWAYS fighting for dollars. The CIO himself will be begging for budget. >>

That statement is not true if the employer is an IT vendor/supplier. In that case, IT is a revenue/profit generator.
Far be it from me to disagree with you sir, as much as I've enjoyed so many of your comments - but I'll try to make a semantic argument anyway:
If your employer is an IT vendor/supplier and your work is billable to customers, I would argue that you aren't really in IT, you're part of a services product.

Anyway, I agree that if you are providing IT services to your company's customers, then you are in a much better position being tied directly to revenue. Especially if the customers like you :-)

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 4:33 pm
by mouses
Elsebet wrote:
Thu Sep 28, 2017 2:20 pm
Last year I received a really low raise, my lowest in my entire career, even when I had a great year. My boss was apologetic and explained that I had reached the top salary for my grade and therefore he couldn't give me a higher raise until I was promoted. It took until yesterday (almost a year) for my promotion to go through but I received no increase in salary. My manager I feel is genuinely upset about not being able to give me any more money with the promotion, but he says I can now get the usual 2-3% raise per year now that I'm no longer capped.
As I read this, it sounds like annual salary increase time is any time now, is that right?

I got run over in terms of salary my first few years at Megacorp, my first job out of college. Like an idiot, I assumed I was being paid fairly. They I got promoted to a supervisory position and discovered that the guys (all men) I was supervising were being paid about 30% more than I was. I managed to get my salary increased, but never got the retroactive amount.

I learned from this that you have to politely be a squeaky wheel. Nothing like, raise my salary or I'm leaving, which may result in your being unemployed, but rather come up with some plan with your manager.

Also, as others have said, I would also definitely start interviewing. A better job may be out there. If not, you will at least get information about what you are worth in terms of salary.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 5:44 pm
by gunn_show
CaliJim wrote:
Thu Sep 28, 2017 2:58 pm
As a stock holder (via VTI): I think your pay is just fine, in fact, maybe you are overpaid. :twisted:
Was my first thought as well CaliJim, but I don't think she is at the Bezos farm. They offer RSU's (at least all friends I know working there had them), so unless she is in the wrong dept, she is not there. Could be Expedia or Boeing or any number of megacorp's in Seattle, I think folks would be surprised how many are there.

I see 3 options (as a high tech megacorp employee)

Stay at this org and this team ... knowing what that means in terms of limited pay and upside

Stay at this org and find a new team.. although it is uncertain if that will really benefit you long term, if all roles/teams are under the same pay constraints you have now

Leave ... perhaps the best option. You say "I intend to work until 59.5 and I'm aware of the ageism issues" and I somewhat agree.. but then you say "so jumping ship right now might not be the best idea".. which I think is backwards. You are better off moving around NOW, while still 'more-employable' at 41, than waiting till later 40s or early 50s. I also don't believe in this "I do not NEED more money" if you are a hard worker, and climbing the ladder, you deserve appropriate pay. COL goes up, taxes go up, inflation is real, you can always use more money. You are not getting it now:

--Stagnant wages... "at best" 2-3% raise and even after a promotion you got ZILCH
--No bonus opp
--No RSU opp
--No money with promotion you earned and deserved
--You "can now get the usual 2-3% raise per year now that I'm no longer capped".. sorry, that is capped... 2-3% raise would be a disappointment for me, if that is your annual ceiling. I do agree the pay band question comes into mind, but you should have jumped into a new one with a promotion, so no associated raise is straight BS to me.

Thus ... "I feel like there is little point to working hard at this job"

So, sounds like you have to think hard as to whether you stay and accept your fate... or go find a better job. LinkedIn / recruiters are your friend.

Re: My first promotion without a pay increase

Posted: Thu Sep 28, 2017 6:45 pm
by Christine_NM
Elsebet -

This happened to me once when there was an overall restructuring of the company's hierarchy. I was offered a move from the tech ladder to a higher paid ladder, but there was no money to give me a raise until the next year. Everyone involved seemed embarrassed at this oversight since theoretically many could have been tapped for a move up, but no money had been budgeted for immediate raises. In reality most positions were renamed but unchanged in salary.

I took the position offered on the new ladder without a raise, and told my manager that I trusted the salary would catch up eventually. I knew that by next year the offer may not be there and everyone would have forgotten this particular restructuring so I'd look like I belonged where I had been.

That may not be exactly the same as your situation, but I was counting on a few people being embarrassed enough to make sure my raises brought me up to speed in a couple of years. I was not disappointed.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 9:38 am
by Elsebet
Thanks all for the advice so far, I've read every one and will try to address some questions:

1. Yes, review/raise time is in October, but at best I will see a 3% and that is rare per my manager.
2. In regards to being a low flight risk, my manager is pretty candid with me and told me that I am one of two people on the team that he is afraid will leave. I believe that is why he fought for the promotion even without a raise, at least he got something for me.
3. To give more insight into my second point, my company is very seniority oriented and newer people are generally not as valued as long-time employees who worked their way up from the retail locations. They are also very arrogant and don't seem to care if people leave because "everyone wants to work here". Only within the last few years did they really start hiring people outside of the company for IT positions. Believe it or not this is a company in the Fortune 20 list. They are a good company but very behind the times IT-wise kind of like Vanguard.
4. I do keep my LinkedIn profile updated and respond to recruiters, but so far the positions are either going to be a horrible commute or require relocation. We will be open to relocating in a year or two.
5. When I took this job I relocated from Ohio to Washington. The company paid for that and at the time I was starry-eyed at the opportunity to live on the West Coast. The salary was definitely not as high as it should have been considering the COL difference and in hindsight I never should have taken the job without negotiating a higher salary. That is totally my mistake.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 10:22 am
by financeidiot
Elsebet wrote:
Fri Sep 29, 2017 9:38 am
Thanks all for the advice so far, I've read every one and will try to address some questions:

1. Yes, review/raise time is in October, but at best I will see a 3% and that is rare per my manager.
2. In regards to being a low flight risk, my manager is pretty candid with me and told me that I am one of two people on the team that he is afraid will leave. I believe that is why he fought for the promotion even without a raise, at least he got something for me.
3. To give more insight into my second point, my company is very seniority oriented and newer people are generally not as valued as long-time employees who worked their way up from the retail locations. They are also very arrogant and don't seem to care if people leave because "everyone wants to work here". Only within the last few years did they really start hiring people outside of the company for IT positions. Believe it or not this is a company in the Fortune 20 list. They are a good company but very behind the times IT-wise kind of like Vanguard.
4. I do keep my LinkedIn profile updated and respond to recruiters, but so far the positions are either going to be a horrible commute or require relocation. We will be open to relocating in a year or two.
5. When I took this job I relocated from Ohio to Washington. The company paid for that and at the time I was starry-eyed at the opportunity to live on the West Coast. The salary was definitely not as high as it should have been considering the COL difference and in hindsight I never should have taken the job without negotiating a higher salary. That is totally my mistake.
If I were an executive at your company and considering your position and flight risk, I would not give you a raise based on the information you provided. Here's why:
1. You're not actively looking for another job. If you were serious about potentially leaving, you would be networking, sending out job applications, and actively seeking a job rather than waiting for one to come to you. You're comfortable where you are, even if you're not 100% satisfied.
2. You've already accepted more responsibility for the same pay and lower raises in the past. If you were willing to leave, you would have put up more of a fight or come back with a competing job offer before. You're going to do what's best for the team, so I don't need to worry about you.
3. You listen to your manager and don't raise a fuss. I'm sure your manager is nice, maybe he/she really is "fighting for you," but it's notable that you're not fighting for yourself. You accept that the company just simply won't give you the raises you feel you deserve. You accept their backwards seniority preferences. If you already accept these assertions as facts, you've talked yourself out of a raise. Any manager would tell any employee that any raise is "what the company can afford right now," that they're "doing their best," that you're a "flight-risk" and they're getting "special" concessions for you. It's not your manager's job to get you paid. In fact, it's your manager's job to pay you just enough to keep you around.

Ultimately, if you are ok with your job, and you don't want a longer commute, and you don't want to move, you're stuck where you are, regardless of salary. You've even accepted more responsibility for free! That's excellent value for the company.

Pick some dream jobs that you might want, send out some applications, and see what comes back. Either you're paid appropriately and you will have a better appreciation for what you have, or you will find something better.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 10:57 am
by financeidiot
financeidiot wrote:
Fri Sep 29, 2017 10:22 am
3. You listen to your manager and don't raise a fuss. I'm sure your manager is nice, maybe he/she really is "fighting for you," but it's notable that you're not fighting for yourself. You accept that the company just simply won't give you the raises you feel you deserve. You accept their backwards seniority preferences. If you already accept these assertions as facts, you've talked yourself out of a raise. Any manager would tell any employee that any raise is "what the company can afford right now," that they're "doing their best," that you're a "flight-risk" and they're getting "special" concessions for you. It's not your manager's job to get you paid. In fact, it's your manager's job to pay you just enough to keep you around.
To clarify, I don't think your manager is doing anything malicious, they're just repeating what they're manager said to them, and what their manager's manager said to them and so on. It's a long chain of ignorance and incompetence. Outdated rules continue until they become so untenable that an organization must act. For example, when all the IT talent quits and gets better jobs :wink: .

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 11:17 am
by Afty
I agree with the advice to start looking for another job. There are a lot of tech companies in Seattle that do give bonuses and RSUs, and if you are a high performer, they can become a large fraction of your total compensation. IME, salaries at Megacorps are somewhat set in stone given a job title, but bonuses and RSUs vary greatly depending on performance.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 11:24 am
by gunn_show
financeidiot wrote:
Fri Sep 29, 2017 10:22 am
Elsebet wrote:
Fri Sep 29, 2017 9:38 am
Thanks all for the advice so far, I've read every one and will try to address some questions:

1. Yes, review/raise time is in October, but at best I will see a 3% and that is rare per my manager.
2. In regards to being a low flight risk, my manager is pretty candid with me and told me that I am one of two people on the team that he is afraid will leave. I believe that is why he fought for the promotion even without a raise, at least he got something for me.
3. To give more insight into my second point, my company is very seniority oriented and newer people are generally not as valued as long-time employees who worked their way up from the retail locations. They are also very arrogant and don't seem to care if people leave because "everyone wants to work here". Only within the last few years did they really start hiring people outside of the company for IT positions. Believe it or not this is a company in the Fortune 20 list. They are a good company but very behind the times IT-wise kind of like Vanguard.
4. I do keep my LinkedIn profile updated and respond to recruiters, but so far the positions are either going to be a horrible commute or require relocation. We will be open to relocating in a year or two.
5. When I took this job I relocated from Ohio to Washington. The company paid for that and at the time I was starry-eyed at the opportunity to live on the West Coast. The salary was definitely not as high as it should have been considering the COL difference and in hindsight I never should have taken the job without negotiating a higher salary. That is totally my mistake.
If I were an executive at your company and considering your position and flight risk, I would not give you a raise based on the information you provided. Here's why:
1. You're not actively looking for another job. If you were serious about potentially leaving, you would be networking, sending out job applications, and actively seeking a job rather than waiting for one to come to you. You're comfortable where you are, even if you're not 100% satisfied.
2. You've already accepted more responsibility for the same pay and lower raises in the past. If you were willing to leave, you would have put up more of a fight or come back with a competing job offer before. You're going to do what's best for the team, so I don't need to worry about you.
3. You listen to your manager and don't raise a fuss. I'm sure your manager is nice, maybe he/she really is "fighting for you," but it's notable that you're not fighting for yourself. You accept that the company just simply won't give you the raises you feel you deserve. You accept their backwards seniority preferences. If you already accept these assertions as facts, you've talked yourself out of a raise. Any manager would tell any employee that any raise is "what the company can afford right now," that they're "doing their best," that you're a "flight-risk" and they're getting "special" concessions for you. It's not your manager's job to get you paid. In fact, it's your manager's job to pay you just enough to keep you around.

Ultimately, if you are ok with your job, and you don't want a longer commute, and you don't want to move, you're stuck where you are, regardless of salary. You've even accepted more responsibility for free! That's excellent value for the company.

Pick some dream jobs that you might want, send out some applications, and see what comes back. Either you're paid appropriately and you will have a better appreciation for what you have, or you will find something better.
Based on Elsebet's candid response, I think this is excellent insight by financeidiot, pretty similar to what I would have read-into and replied with. You give all the signs of "resigned" to what you have been given, without enough fight to your manager and company, and they are reading you better than you are reading them, as financeidiot is noting. While this sounds nice - "fought for the promotion even without a raise, at least he got something for me" that "something" doesn't help you pay the bills or for the next vacation, or even for a single visit to Costco on Sunday (you see what I did there OP..). So they successfully "made you happy" with a surface promotion and it cost them nothing. Zilch. "Maybe" it costs them 2-3% at next review period, maybe not. So far it was a free promo for them with no cost attached. There is 0% chance I would have accepted that, none. Honestly I would take it as a bit of a slap in the face to be candid. What is a promotion if -all- the spoils don't come with it? It's nothing. It's like a participation trophy with no real reward attached. Empty calories.

No one will ever fight for you.. like you will.

"financeidiot's" last two lines/paragraphs are spot on: You are at a crossroads where you either stay at this gig knowing how they treat you and will continue to treat you, or you get looking.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 11:26 am
by ClevrChico
The pay grade rules and increase amounts are pretty standard industry wide in tech. I'd suggest looking at other internal positions or other companies. It's possible you won't find anything better, but you might!

And yes, you may be working too hard. I see people sacrificing their lives in tech by being workaholics for maybe $10k extra net annually.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 11:43 am
by djpeteski
The way you make money in IT is by "moving across the street". The market is really tight right now so you may be able to take your pay "to the next level". I did that about 1.5 years ago (at age 49), and am very happy I did. I feel ageism is less important in IT as the non-big names are just looking for anyone with the skills that they need. Many people are losing H1-B types due to more restrictive immigration. Also ageism is less important as the typical work tenure is so short. Who cares if you are 50 years old if you will probably only stay 2-3 years anyway?

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 2:05 pm
by mayday23
denovo wrote:
Thu Sep 28, 2017 2:49 pm
Here's my advice. Everyone thinks they are unpaid. The way you'll find if you really are is if you look for work in another company and find out if they will pay you more for similar work. There's probably no point in arguing with your bosses for money. Looking for new work is hard, but that's really the only way.
Agree with this 100%. Look for a new job, if you can't find one, then maybe you are not underpaid. If you do find one, then you make the determination if you want the risk/reward of switching to a new company. For me, just letting this sit and stew would not do my mind or my work any good and I'd become more bitter at work, which would probably lead to my homelife as well.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 2:41 pm
by Pajamas
Elsebet wrote:
Thu Sep 28, 2017 2:20 pm

I intend to work until 59.5 and I'm aware of the ageism issues, so jumping ship right now might not be the best idea.
I don't see the connection between ageism and not jumping ship. Are you worried that you might be laid off in the future at another employer during a rough spot because of your age? Discrimination in employment exists, but it does not prevent people from getting a job, it makes it harder or impossible to get a particular job.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 4:15 pm
by CAP_theorem
Not enough information.

How much are you paid? What type of work do you do? What types of software/hardware do you work with and what is your level of expertise with it? Are you good at interviewing? What kind of Mega corp? Facebook/Amazon/Google/Netflix type mega corp? Do you look and act younger than your age or older than your age?

Forget whether you need more money. Your time is precious. Don't squander it earning less than you possibly could for equivalent work. The only reason to back off the gas pedal is if jockeying for position ends up stressing you out.

Last time someone gave me a 3% raise I quit and left for a 27% bump. Retention is their job not yours. You put in four years it's enough. No one is entitled to your labor in an at will environment. You only need to put in enough to maintain your brand.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 4:17 pm
by Elsebet
financeidiot wrote:
Fri Sep 29, 2017 10:22 am
Pick some dream jobs that you might want, send out some applications, and see what comes back. Either you're paid appropriately and you will have a better appreciation for what you have, or you will find something better.
OP here. I quoted this one but a lot of people gave similar advice and I will do this. As always thanks for the tough love!

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 4:44 pm
by CAP_theorem
Elsebet wrote:
Fri Sep 29, 2017 4:17 pm
financeidiot wrote:
Fri Sep 29, 2017 10:22 am
Pick some dream jobs that you might want, send out some applications, and see what comes back. Either you're paid appropriately and you will have a better appreciation for what you have, or you will find something better.
OP here. I quoted this one but a lot of people gave similar advice and I will do this. As always thanks for the tough love!
For many dreams jobs are something you grind out not something that just happens. Don't just send out some applications without having a plan to make your end goal a reality.

I know too many people doing worse work for less money than what they could achieve if they treated the job hunt like a real job.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 5:05 pm
by gunn_show
CAP_theorem wrote:
Fri Sep 29, 2017 4:44 pm
I know too many people doing worse work for less money than what they could achieve if they treated the job hunt like a real job.
CAP_theorem wrote:
Fri Sep 29, 2017 4:15 pm
Forget whether you need more money. Your time is precious. Don't squander it earning less than you possibly could for equivalent work. The only reason to back off the gas pedal is if jockeying for position ends up stressing you out.

Last time someone gave me a 3% raise I quit and left for a 27% bump. Retention is their job not yours. You put in four years it's enough. No one is entitled to your labor in an at will environment. You only need to put in enough to maintain your brand.


Excellent, excellent advice CAP. 100%

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 5:06 pm
by tcassette
There is one other thing to keep in mind. If your company decides to downsize or outsource IT, one of two things will probably happen to you. Either you will be laid off, or you will be one of the "lucky ones" left to do your AND your departed colleagues' work, probably with no pay increase. That is how it works these days. You may think you are valuable to your company and highly regarded, but many times that does not translate into benefits for you.

Re: My first promotion without a pay increase

Posted: Fri Sep 29, 2017 5:25 pm
by BogleMelon
The way I look at it is: We sell our time and energy for the money. The company takes a piece of our lives for money. If the company wants to take more piece of our lives as in the case of getting promoted (AKA now you sell time, energy and responsibility) at the same salary then you are selling more at the same price. Promotion should equal to more $$, otherwise it is just additional responsibility on you (now they can blame you for more stuff at the same pay!). I am not saying to jump off the ship, but if I were you I would shop around and see what is currently in the market. You may find out that you are already getting paid what you should get anywhere else, which means you are fairly compensated, and thus working happily ever after without changing employers. But till you do that research you will never know if you are getting paid fairly or not.

That reminded me of the question of "What is the fair price of xyz stock?", the fair price is always the market price.. It is the price that others are willing to pay.

Good luck!

Re: My first promotion without a pay increase

Posted: Sat Sep 30, 2017 9:29 am
by JoeJohnson
BogleMelon wrote:
Fri Sep 29, 2017 5:25 pm
If the company wants to take more piece of our lives as in the case of getting promoted (AKA now you sell time, energy and responsibility) at the same salary then you are selling more at the same price. Promotion should equal to more $$, otherwise it is just additional responsibility on you (now they can blame you for more stuff at the same pay!)
I didn't see any mention of extra responsibility that came with the promotion. The promotion sounds like it was recognition of past work so that OP could get out of the previous salary band. OP is/was a high performer; doesn't necessarily mean taking on extra work after the promotion (nor should OP given the current situation).

Re: My first promotion without a pay increase

Posted: Sat Sep 30, 2017 11:43 am
by Traveler
fabdog wrote:
Thu Sep 28, 2017 2:33 pm
based on what you wrote, it sounds like you are very highly paid vs how they have you placed in their compensation structure... you were "topped out" in your position before the promo (based on boss comment you had reached the top of the pay range). If you hadn't been a good/great performer the raise would have likely been a zero.

To get a promo to the next grade level and no raise with it means you are pretty highly paid in that range as well (the pay bands likely have a lot of overlap) and with his mention of now you could get a more standard raise you're likely still over the mid point of that grade.

Do your annual reviews or the promo come with any documents that show your pay range and how that lines up against your current salary? Say it says you got 1% raise and salary is now 79,700 and your pay range is $70K to $80K? Or after promo you now make $79,700 and you range is $74K to $84K?

Did you get a large raise when you joined this firm? Ask you boss if you can see the pay scales... what would it take to get moved up another level?
Or as noted.. explore what other companies are willing to pay for your skill set

Mike
This is exactly how it is at my megacorp (although I'm not in IT). The pay bands overlap a lot so if you're maxed out at the lower level, you're still over the midpoint of the next up level. That said, at my company, with each higher level, the bonus increases a lot, so there is a fairly large compensation increase even if the base salary barely moves. For instance, I am about 10% above the midpoint for my job. If I were promoted, I would likely get at most a 5% base pay increase, but total comp (base plus bonus) would increase about 25%. Not to mention more going into the 401K and retirement account.

Re: My first promotion without a pay increase

Posted: Sat Sep 30, 2017 12:33 pm
by harrychan
I've been in your position. I was in the same IT megacorp for 14 years except I got regular promotions. In the early days around mid 2000's, I got 10 and even 15% jump in pay after a promotion. Then I became global head and the pay raises became more in the 2-3% range which was supposed to be "good". I did get bonus of 20% but it was contingent on financial achievements of the department, something I had no control over. I finally decided it was time to start looking. Similar to yourself, I wasn't in a hurry as I worked full time from home making over 6 figs. I knew exactly where I wanted to work and started looking at new vacancies that got posted. It was a company that was notoriously hard to get in who still offered retirement and healthcare pension. After 3 years and 40 some applications, I got one interview and got the job. My pay jumped by 45%. It's a sad world where companies indirectly reward switching companies to get ahead. Had I stayed at my old company, it would've taken me 20 years to get to my salary now. I lose some conveniences but now I have much more opportunity and my DW can quit and stay at home at will.

Re: My first promotion without a pay increase

Posted: Mon Oct 02, 2017 1:54 pm
by finite_difference
I would not accept a promotion without a pay increase unless I felt I was at a point where I had given up asking for pay increases and could use the promotion to help me jump to another company.

In your market, are you underpaid or overpaid for your skill set? Reading between lines it sounds like possibly either you are paid a lot for what you do in the local market, or you are paid reasonably well and they don’t consider you a flight risk, so they are going to use their promotion money to increase salaries for those who earn less and they are more worried about potentially losing. I would update your resume and start sending it around to see if you are being underpaid. Always good to look around since you never know what kind of position could open up.

However, I would give your manager a chance here — maybe this Megacorp is really bureaucratic and he/she is doing their best for you. Still, do try to be a gracious but assertive squeaky wheel in terms of making sure your manager understands your pay is important to you and that you appreciate his/her support. I don’t think a 3-4% increase per year for a high performing employee, even at the top of your scale, is greedy on your part. If the company is having financial issues then it’s understandable but then you also want to protect yourself too. If your manager doesn’t deliver next time, then I think it’s fair to lose confidence in him/her.

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 2:05 pm
by Elsebet
JoeJohnson wrote:
Sat Sep 30, 2017 9:29 am
I didn't see any mention of extra responsibility that came with the promotion. The promotion sounds like it was recognition of past work so that OP could get out of the previous salary band. OP is/was a high performer; doesn't necessarily mean taking on extra work after the promotion (nor should OP given the current situation).
OP here. You are correct, there wasn't any additional responsibility added, I was already operating at the level to which I was promoted to. It was precisely a promotion to uncap my salary.

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 2:08 pm
by Elsebet
finite_difference wrote:
Mon Oct 02, 2017 1:54 pm
However, I would give your manager a chance here — maybe this Megacorp is really bureaucratic and he/she is doing their best for you. Still, do try to be a gracious but assertive squeaky wheel in terms of making sure your manager understands your pay is important to you and that you appreciate his/her support. I don’t think a 3-4% increase per year for a high performing employee, even at the top of your scale, is greedy on your part. If the company is having financial issues then it’s understandable but then you also want to protect yourself too. If your manager doesn’t deliver next time, then I think it’s fair to lose confidence in him/her.
OP here - I do trust that my manager is doing his best for me within the confines of MegaCorp policies. I'm going to lightly peek around at openings but I'm not going to really do a lot of that until I see what my raise will be in Oct/Nov. The company is definitely not having financial issues other than being a bit late to the internet shopping party.

Thanks again all for the advice, I've read every reply.

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 3:35 pm
by simple man
I agree with some others that they might not think you are a flight risk....Every now and then, wear a suit to work. Get haircuts regularly and make yourself look more marketable (whatever that means in your situation). Take off a day with very little notice. At the same, make a positive case to your manager that you bring great value to the company and that you think they deserve a raise. All those work together to increase your chances...

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 3:56 pm
by frequentT
Elsebet:

The situation you describe happens all too often. It is the curse of mega corps, tightly bound pay ranges, salary compression, etc. You are being tested. The question is why? Did this promotion only change your title? Increase your responsibilities? Make your more marketable in some other way? You may have good compensation and benefits, however, I am not reading anything about 'golden handcuffs'. Accepting this treatment in a mega corp is tantamount to saying "don't worry about me, I am not a flight risk"--megacorp is free to throw its compensation dollars to other managers to make sure they don't leave.

I agree, it is time to test the market. That is the only way to know if you are being fairly compensated for your services. Your career is in its peak growing period. This is when you have the best chances of increasing your salary, responsibilities and can start to close in on your ultimate career objectives; not a time for stagnation.

I recommend that you quietly get our there and interview to detirmine if there are better opportunities available. Don't waste the next year wondering if your boss is going to bat for you with the HR structure for a pay raise: Best to know your worth before that point.

It sounds like you can handle your current responsibilities with ease. So, you should be able to manage a stealthy search effort at the same time in order to understand your market value. It is completely possible that you may find a much better position with much better compensation!

Good luck!

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 7:01 pm
by KlangFool
Elsebet wrote:
Tue Oct 03, 2017 2:08 pm
finite_difference wrote:
Mon Oct 02, 2017 1:54 pm
However, I would give your manager a chance here — maybe this Megacorp is really bureaucratic and he/she is doing their best for you. Still, do try to be a gracious but assertive squeaky wheel in terms of making sure your manager understands your pay is important to you and that you appreciate his/her support. I don’t think a 3-4% increase per year for a high performing employee, even at the top of your scale, is greedy on your part. If the company is having financial issues then it’s understandable but then you also want to protect yourself too. If your manager doesn’t deliver next time, then I think it’s fair to lose confidence in him/her.
OP here - I do trust that my manager is doing his best for me within the confines of MegaCorp policies.
Elsebet,

What had he done to earn you trust? Did he deliver the good/promise? If not, his best is not good enough. Why should you trust this person to deliver anything for you in the future?

Business is the business. They judge you based on what you had done for them lately. Vice versa. You should judge them on whether they can deliver for you.

The best pay raise and bonuses (quarterly) that I ever get is when my employer was on the verge of bankruptcy. This was when the employer had quarterly laid off too. This was a megacorp. They knew that they had to pay to keep people when they were unstable.

KlangFool

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 7:58 pm
by hightower
Elsebet wrote:
Thu Sep 28, 2017 2:20 pm
Hi all, thank you as always for your great advice.

I am looking for some words of wisdom to console what I feel is a bit of a let-down at work. I'm 41 and have worked in IT for my MegaCorp for 4 years now. The first two years I was here I had terrible managers and left both teams (the second team was disbanded soon after I left). I've been on my current team for two years and the manager and senior members of the team really like my work. I work hard and strive to be a high performer. Last year I received a really low raise, my lowest in my entire career, even when I had a great year. My boss was apologetic and explained that I had reached the top salary for my grade and therefore he couldn't give me a higher raise until I was promoted. It took until yesterday (almost a year) for my promotion to go through but I received no increase in salary. My manager I feel is genuinely upset about not being able to give me any more money with the promotion, but he says I can now get the usual 2-3% raise per year now that I'm no longer capped.

We do not get any bonus or RSU's, the only increase I can get is either promotion or the annual raise. Since I didn't get any increase for my promotion I am stuck waiting for the annual increases and hoping I get close to 3%. I feel like there is little point to working hard at this job if I'm going to get a similar increase to those who just put in the bare minimum. Yes, I am thankful to have a good job, manager, and team. It's just disappointing to not be financially rewarded for going above and beyond. I am trying to focus on the intangibles like the work-life balance (which is I'd say TOO good and delays work), an easy commute, and a solid team. However I live in an HCOL area (Seattle) and my property tax goes up a lot each year, nullifying much of my raises.

I intend to work until 59.5 and I'm aware of the ageism issues, so jumping ship right now might not be the best idea. I do not NEED more money; I make a good salary, max my retirement funds, and we keep our expenses low. At our current pace/savings we should be fine when I'm 59.5. My company will not allow my manager to give things like extra vacation in lieu of an increase, I already asked for that and was declined.

Any advice for a good mindset to have in this situation? At all of my other companies I was well rewarded financially for being a high performer and it's hard adjusting to this new reality.
Sounds like you're doing the right thing already...working hard, saving appropriately. Unfortunately, unless you are willing to shop around for a new job, there's probably not much you can do and the company probably knows it. That's why they aren't handing out raises. Seattle has a competitive job market and a competitive housing market and therefore pay is less generous and housing is expensive. Fortunately, you like your job, it sounds like you have a great work-life balance, and you live close to where you work in an awesome city. I say, just enjoy it while you have it. Nothing is guaranteed in life for anyone. Those are big benefits that others don't always get. I live in the mid-west and would LOVE to live in a city like Seattle where I could be so close to so many wild places (Mt Rainier, Olympic, etc). I make good money and have cheap housing, but I have to travel far for the awesome amenities that you have in your back yard and it costs me a lot of money to do so.
I can totally understand though that it must feel a bit demoralizing to know you're busting your butt every day and seeing such stagnant pay. It really does help to just try to focus on the positives in situations like this and hope for the best. Keep working hard and being kind;)

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 8:25 pm
by sunnywindy
Welcome to the megacorp. You are just a number.

(I know this is awfully cynical, but there is some truth to it.)

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 8:26 pm
by noco-hawkeye
I also work in IT, and have seen and experienced the same thing you are going through. It's very common.

There are two types of people in this situation:

Type 1 wants to keep income coming in, enjoys stability, and wants to progress in his current company. His employer knows this, and gives out small raises because they know he's not going anywhere.

Type 2 picks up some new hot skills, and networks outside his company. He gets a job offer for 75% more money, and his current employer decides they need to offer him 50% more to keep him in place. Type 2 job hops around, and ends up making about twice what type 1 did over a 5 year period.

I've been both, and type 2 is where you want to be. You'll survive as type 1, but type 2 is a lot more fun and lucrative.

Re: My first promotion without a pay increase

Posted: Tue Oct 03, 2017 11:18 pm
by random_walker_77
simple man wrote:
Tue Oct 03, 2017 3:35 pm
I agree with some others that they might not think you are a flight risk....Every now and then, wear a suit to work. Get haircuts regularly and make yourself look more marketable (whatever that means in your situation). Take off a day with very little notice. At the same, make a positive case to your manager that you bring great value to the company and that you think they deserve a raise. All those work together to increase your chances...
Careful. "Looking" like you're disloyal and/or actively job hunting carries potential negative ramifications. For those who are job hunting, these possible downsides are offset by the potential gains from a better job. I'd never recommend bluffing here, as you run the risk of possible downsides, without the corresponding benefits from getting another job. Without an outside offer, you're also not likely to get a last minute raise -- at a megacorp, once the compensation pot has been divided, there's limits to what a manager/director can do. There's probably a reserve to grease key squeaky wheels, but that route has its own pitfalls.

Get an outside offer. If it's good, take it. It's cleaner that way, and better in the long term than trying to extract a matching offer from your employer.

Re: My first promotion without a pay increase

Posted: Wed Oct 04, 2017 8:11 am
by eg1
What will most likely happen this year is that your raise will be better than what it would have been if you hadn't been promoted. Salary bands are the norm at most megacorps and direct managers have very little say what your raises will be. I just interviewed for an internal position that would have been an promotion with significantly more responsibility and the raise would have only been 4%. Not worth it IMO but it depends on how much you value your outside of work time.