Iyfjky

Question

I live in eastern Europe, and I work for a mid-sized (West European) IT Company, where all salary-related issues are handled directly by the CEO. About six months ago I requested a series of documents from my employer, in order to get a mortgage to buy an apartment.

Later on, I had my annual performance/salary review. I was met with a lot of praise regarding my activity, but also with a very firm response of "no budget for a raise this year". I was told that maybe there'd be another discussion about it in six months. The outcome had nothing to do with my performance.. He stated that I was a high performer, and gave me more responsibilities.

The CEO's reasoning was that my current salary was "more than enough" to cover living costs -- and in particular, he mentioned me as still being able to cover my mortgage payments with my current salary. He warned me that: "it would be very risky to try and find another job", as if my having a mortgage makes it impossible for me to just quit.

Where I live, it's not possible to get a loan/mortgage from a bank without one's employer being involved. I really don't feel comfortable about my employer using this kind of information as leverage against giving me a raise.

Is there anything I can do to prevent this information from being used as a bargaining tool against me, and still maintain a good professional relationship? Or is this justifiable? Should I have anticipated this happening?

Any reason you can't start looking for another job while continuing the current one until you have a new one? — May 16 '16 at 13:27
@PatriciaShanahan: I don't think it would be difficult for me to find a new job, but I want to explore all my options. Also, there may be others in a similar situation, with less marketable skill sets - for whom switching would be a difficult choice to make. — May 16 '16 at 13:54
"Very risky" Where those his exact words? It's one thing for a CEO to use inane arguments to talk people out of a raise. That you could maybe reason with. It's something else entirely to threaten someone's livelihood when he makes for a case when he's obviously underpaid. — May 16 '16 at 18:21
The "very risky to try and find another job" comment is weird - surely you can start looking without leaving this one? It veers close to the sunk costs fallacy; it completely ignores the "risk" of staying at a company who seem to be content giving you more work and more responsibilities without giving you more pay to reward you for it. If you're a high performer, then you're valuable to them. Perhaps you should remind them that underpaying such a high-performing employee creates a risk that they may get fed up and decide to leave... — May 17 '16 at 15:42
Does it matter whether this was unethical or not? Seriously. Sounds like your CEO just told you that he sees you as an asset to be exploited, and all your high-performance work isn't going to be rewarded because he doesn't have to. Doesn't even matter if he's right or not about that, at the end of the day, this is not someone you want to work for if you have other options. If you have other options, exercise them. If you don't... my condolences... try to find some. — May 17 '16 at 16:45

Mave 1033 · Accepted Answer · 2016-05-19 09:53:49Z

As long as your employer knows how much money you are making (which they do of course) and what your major living expenses are (home mortgage, auto loan etc.) through whatever legal means necessary, you my friend, unfortunately, are "s#!+ out of luck" as we say in this part of the world. Is it ethical? Absolutely not ! Is it legal? Depends on your country their laws, but in eastern Europe, it usually goes without saying, laws are pretty much a joke if you know the right people.

So, if your employer knows you have a big financial burden that you can not undertake without your current salary, and they also know, there are not many places who can pay you as much as they do (i.e. job mobility is non-existent), what would be their incentive to give you more money? Absolutely none.

I strongly advise, despite how bad it might be out there, I don't know, you start looking for new employment. Because, if you don't, your current employer will have you under the gun as long as you work for them.

And to add insult to the injury, if you have people who you can really call friends, working for the same company in a somewhat similar position, ask them how much raise they got. I am sure at least one or more of them did not have to hear the "no money in the budget for raises" bull crap and got something.

Just my observation.

Comments are not for extended discussion; this conversation has been moved to chat. — May 18 '16 at 3:18

user8365 · Answer 2 · 2016-05-16 15:42:27Z

In any negotiation, what one party is willing to accept is always a factor. Personally, I think your boss was an unethical fool for even mentioning this. If the company can't afford it, that's it, but to insinuate you're trapped in this is just a bad idea. It would be terrible if he found out you or a family member had a costly illness and he used that against you. Many would find that unethical.

There is little incentive for you to produce at such a high-level. This owner believes he is doing you a favor when in fact, you're excelling and make his business better. Take pride in being a good professional, but you don't owe this company any more than that.

Where are they going to find someone as good as you willing to work for your salary? Not everyone has a mortgage. I'm not suggesting you intentionally should hold back on your efforts. I find it difficult to want to put forth any extra effort. This owner may fire you out of spite, so be careful.

Keep checking the job markets. Many banks don't care if you change jobs as long as you stick with a similar salary and job description. You can check with them if you think it could be an issue. I don't think you owe much loyalty to someone who is so brazen to throw your financial situation in your face when asking for a well-deserved raise.

Unethical fool indeed. Your financial situation should be completely irrelevant unless the boss wants to help an employee who is in trouble through no fault of their own. And what he did completely destroys any loyalty; many employees would actually try to leave in a way causing maximum problems for the employer. — May 18 '16 at 15:34
I don't know what the mortgage contract says, but it does not seem likely that it could require you to stay in your current job or one like it. I imagine your obligations do not extend much beyond the principal one of making payments on time, and it is not in the bank's interest to foreclose so long as you are doing so. — May 18 '16 at 20:14

score 25 · Answer 3 · 2016-05-17 16:45:05Z

up vote
25
down vote

Your boss has told you, in not so many words, that the company owns you. You are a working-class slave.

If I were you, I would begin to quietly start planning my exit strategy. You are dealing with a bully, plain and simple.

"When someone shows you who they are, believe them the first time." -- Maya Angelou

edited May 17 '16 at 16:45

answered May 17 '16 at 16:34

Xavier J

26.3k104797

4

I disagree, his CEO merely stated that he has no financial grounds for a raise and that he does not see his a unbalance in his wage vs his performance
â€“Â Raoul Mensink
May 18 '16 at 12:15

6

Throwing in on disagreement with this....so much incendiary language re:slaveThe company is a buyer.The 'employee' is a seller. The company simply said it will not pay a higher price for the OP's product. OP's negotiating ability is impacted by his walkaway power and his walkaway power is impacted by his economic circumstances.The buyer thinks his intimate knowledge of the seller's finances gives him a leg up in bargaining, so decided not to flex on his price.Buyer is speculating that the OP's walkaway power is low and will have to accept a price lower than OP would expect to receive.
â€“Â K. Alan Bates
May 18 '16 at 14:47

9

Without going as far as slavery, it seems the 'buyer' is bullying OP. 'Warning' an employee finding a job might be difficult after refusing a raise is a way to say no, but not the nicest one...
â€“Â FranÃ§ois Gautier
May 18 '16 at 15:07

1

@Raoul Mensink you said "CEO merely stated that he has no financial grounds for a raise" however, this: "The CEO's reasoning was that my current salary was "more than enough" to cover living costs -- and in particular, he mentioned me as still being able to cover my mortgage payments with my current salary" disagrees
â€“Â industry7
May 19 '16 at 15:58

@industry7 could you clarify your point/argument?
â€“Â Raoul Mensink
May 20 '16 at 7:23

Â |Â
show 1 more comment

Jim 4,475623 · Answer 4 · 2016-05-16 17:21:34Z

When negotiating, it might help for you to try to address the issues, rather than fight their existence. For example you could respond with, "In the future, I hope that I am rewarded with exceptional pay for exceptional performance, not sufficient pay for exceptional performance."

If you are comfortable with your salary and you just feel undervalued, then you should probably address that along with the budget. "I understand the budget concerns. I work hard so that I can have extra income to enjoy my time out of the office more. I hope that soon there will be budget for a much better raise than normal so I can feel like the company values my work, and the raise will allow me to enjoy my time outside of work as much as possible by providing me with financial rewards greater than what I am getting now, regardless of whether my current pay is sufficient in the eyes of the company."

Besides that, while your boss knows about your house, he does not have all information. Also, who is he to judge what is 'more than enough' in terms of salary? You may have less tolerance for debt payments, expensive schools for your kids, etc.

You might also consider using additional personal tactics to encourage him to change his mind. For example, "Well, I gave up a lot of personal time and took out a loan that was larger than I was comfortable spending because I really expected a raise. I feel very let down that there is not enough budget to provide me a raise. I will probably need to make some personal changes to get through this."

I would avoid outright lying like, "The loans you know about are not the only debts we have. So this will be a very hard year for me without a raise." But if something like that happens to be true, it would be excellent to mention.

Taking this approach, in the future your boss may want to stay more focused on performance and measures of your job, rather than try to assess your personal life and personal decisions.

Good luck!

"The loans you know about are not the only debts we have. So this will be a very hard year for me without a raise." Who would take a loan based on a possible future raise? — May 16 '16 at 19:31
@Marc: Not saying it's correct behavior, but I think people do it when they win the lottery or something like that. They quit their job and/or start buying stuff before they even have the money in their pocket. I believe this is also a factor in how people become severely in debt over a period of time. I'd probably ask, who would give a loan based on a future raise? — May 16 '16 at 19:48
Someone eager to provide for their family or under family pressure to buy a house (new child arriving?) may ask for loans from friends or family, and they may hand them out. The point is, make the boss aware that he has limited personal information and probably doesn't want to know more, because then the discussion of salary is not about employee performance. That's a bad place for the boss to be. — May 16 '16 at 20:23
If the boss has already shown that he's capable of taking the low road, and has basically told the OP that he's a slave, how is any of this going to make a difference? — May 17 '16 at 16:29

score 6 · Answer 5 · 2016-05-16 15:24:05Z

Do you know for a fact that the CEO is withholding a raise because you've taken out a mortgage? It seems his explanation was that there's not a budget for one; that raises other questions which are discussed below. Not giving raises to people after they purchase homes would only work well in job markets in which there are few openings and little mobility. In markets with lots of openings and mobility, excellent performers would just find a new job if their employer stopped giving them raises after they bought homes. (The local housing market would have something to do with this too - if homes sell quickly and easily, people won't feel too tied to a location, compared to a housing market where homes stay on the market a long time before they sell.)

Is this normal? No, at least not in a robust job market, as I indicated above. However, it's not entirely unheard of. This sort of attitude is why some employers are known to prefer married workers with children and mortgages who aren't likely to job hop.

What can you do? Probably nothing positive, if finding a new job isn't a possibility (if it is a possiblity, I'd recommend it, as either your boss is treating you unfairly (and possibly dishonestly) just because you bought a home, or the company is in trouble). You said in comments that you live in eastern Europe; I'm not familiar with laws and regulations there, but it seems unlikely there is much to prevent this sort of thing; you'd need to consult a legal expert for that anyway. Otherwise, some of the ideas I can think of are:

You could question the owner about the viability of the business, since he's basically told you there's no budget for a raise for a top performer. Unfortunately, I doubt that gets you what you want if the CEO is really doing what you suggest.

You might try to have a conversation with your boss about what it will take to ensure a raise when the six month period is up (and maybe what size that raise will be). This sends the message that you definitely want to see an increase in your salary, and makes it clear what the boss wants; it also makes him obligate himself to giving you that raise.

Let me make clear that I recommend that you keep your disappointment to yourself around your fellow employees. I include the following idea to show why it would be a bad idea: You might consider spreading rumors that you were told that you couldn't be given a raise because of budget issues, implying financial difficulties for the company. Such rumors might cause co-workers to leave, freeing up financial resources to give you the raise you want. However, this is likely to create more problems than it solves: It could turn out to be true and the loss of employees accelerates the demise of the company, or the CEO could find out the source of the rumors and punish you, possibly with a firing.

I think that questioning the viability of the business would be counter-productive in negotiating salary. He can always say that the business is indeed at the limit, so we all need to make concessions (me first, of course)... — May 16 '16 at 21:19
@Elaela: It may be counter productive as a negotiating strategy, but it's important to know if your employer is about to shut down. If the boss does tell you that belt tightening is needed, then you should ask how bad things are ... and get your resume on the street as soon as you can. — May 17 '16 at 2:01
+1 for "have a conversation with your boss about what it will take to ensure a raise" --- A very good strategy. If they don't respond with detailed requirements, you might follow up with, "thank you for adding responsibilities X & Y to my position. I'm eager to add more value to the company. If I execute responsibilities X & Y, bringing new value to the company, will this be reflected in my salary after the next performance review?" In general, adding responsibilities without a raise is not sustainable, taken to its extreme you could be doing CEO work for a janitor's salary. — Apr 16 at 12:48

coteyr 8,83511433 · Answer 6 · 2016-05-16 16:46:59Z

Unfortunately your employer has both sides of the equation. That makes it a tough spot for you. Ethics is a tricky situation. A lot of people will say that you should be evaluated for a raise no matter what. Or that you should get a raise every year no matter what. I don't agree with them.

Back to your question though. It seems to me that you were given a straight answer. They don't have the budget for raises. Now on that info alone you have to decide rather or not you want to "jump ship". I wouldn't. Companies have these issues short term. I would stick it out a year and see if the raise freeze is released next year (or in 6 months).

Mentioning that "you make enough" could be an attempt to explain that what tiny budget that exists is going to go to employees that don't "make enough". Rather that is ethical or not is going to be region and circumstance specific. Personally on this front, I would be taken aback by the comment, but it also depends on circumstance. How big is the company, how many other people work there, have other things been cut. Is this person really trying to make it through a lean time, and just being (overly) honest?

What you have to decide, and only you can, is was this statement "ha, I got you now" or "look I'm trying to make this work for everyone". If your in the first situation, go look for a new job. This type of employer sucks, but will likely give you raise once they figure out they "don't have you". If it's the second, then keep a close eye out for other finical problems, but you need to decide if you want to stay there and work through the lean times, or if you want to move to a more stable company. Working through the lean times is not all bad, but it certainly has it's risks.

"A lot of people will say that you should be evaluated for a raise no matter what. Or that you should get a raise every year no matter what. I don't agree with them. " Companies refuse to give our reasonable raises... and then companies complain when their workers leave their jobs for better paying ones... — May 19 '16 at 16:01
But "reasonable" is subjective, specially when employees, in general, don't want to "give back" those raises during a lean year. So should raises be "when the company is profiting more" or "in line with inflation" or "adjusted to the regional average"? What about when those numbers go down? It there is a cost of living decrees should the employer adjust your earnings down? Reasonable is very subjective. I was simply stating that my advise comes from me, and I do not think that I company should always give a raise. Of course as an employee you always have to evaluate if your making the right $. — May 19 '16 at 17:12

user50700 · Answer 7 · 2016-05-18 11:49:57Z

It has nothing to do with employer knowning your personal situation. Even if they don't know, they still know the typical expenses of people in your situation and they still would claim that you earn more than you actually need (which is almost certainly true, people in IT earn in Eastern Europe about 2-3 times the average).

It's quite typical for employers to claim how lucky you are to have stable and secure job, and how dangerous there is outside. Is it ethical? I think most of them really believe in what they are saying, nevertheless they use fear against you.

Another observation for Central/Eastern Europe - it's much easier to find new job with higher salary then get satisfying raise for current one.

Unfortunately your last comment is quite true in western Europe too. I can't speak for anywhere else. Often the best way to get the raise that you deserve is to get another offer and use that as a negotiating point. — May 18 '16 at 11:55
@zelanix It's mostly true in the United States as well. Your wage is determined by what your second highest offer is (a function of Expected Delta MRP2). The buyer just has to pay a token more than the 2nd highest offer to price them out of the running for your product. So...the best way to increase your price is to let the market do the work for you when you can get an offer that is higher than your current one. Your current buyer will either agree to an increase in your labor price or they will let themselves be priced out of the market. — May 18 '16 at 15:20

score 0 · Answer 8 · 2016-05-19 13:25:31Z

To answer the title:

Is it unethical for an Employer to use personal (financial) information in negotiating salary?

Depends on the following:

Are you getting hired? Yes.

Are you trying to get a raise? No.

Are you getting a reduction in pay? Yes.

In your case I don't think it is unethical. You have not given any facts that he would otherwise have given you the raise would you not have had the mortgage. If anyone with similar positions is getting a raise, but for without a mortgage or loan, then it is unethical.

The warning can be taken both as concern that you could get into debt if you leave or as a way to Keep you in the Company. Unless proven otherwise I am going to assume it is the first.

Why is it ethical to do the same thing in a hiring interview that would be unethical in a performance review? I'll give you a hint - it's not. — May 18 '16 at 22:34
@HopelessN00b my personal Information is given to my employer, he has the right to use it, not abuse it. And as i mentioned there are no Facts provided that would Point to abuse. — May 19 '16 at 13:32

Graham 2,616617 · Answer 9 · 2016-05-18 10:27:12Z

I'm guessing that you work more than the "official" hours. Then a simple answer is to tell your boss that as long as you are not receiving any recompense from the company for extra work, you will not do any extra work. It's called work to rule. You can't be fired for doing just what your contract requires.

Meantime, as others have said, make your exit plans.

You can't be fired for doing just what your contract requires. You don't know that. He could live in an at-will-employment jurisdiction, or (as he's suggested) a part of the world where corruption is the rule, rather than the exception. It's entirely possible (even probable) that he could be fired for any reason at all, or no reason at all. No, as is almost always the case, it's better for you to look like a high-performing, happy, productive employee right up to the point when you put in notice or quit. — May 18 '16 at 22:33

Thomas 1 · Answer 10 · 2016-05-18 10:26:04Z

up vote
-4
down vote

Maybe you should suggest that if exceptional performance will not be valued at all then you will have difficulties in motivating yourself to perform exceptionally in the future. Since you get good money, performing "good" (which is still more than "average") should be fine...

answered May 18 '16 at 10:26

Thomas

1

3

I would be against using passive aggression in this situation (in any situation?). 'Threatening' to decrease the productivity shouldn't be on the table. Stating you disagree with the decision and highlighting you think your work deserve a better pay should be the way to go. It might imply you could go for a higher bidder or you would decrease your productivity to match the pay, but you are not threatening anyone: you just disagree.
â€“Â FranÃ§ois Gautier
May 18 '16 at 15:14

suggest improvementsÂ |Â

Mave 1033 · Accepted Answer · 2016-05-19 09:53:49Z

As long as your employer knows how much money you are making (which they do of course) and what your major living expenses are (home mortgage, auto loan etc.) through whatever legal means necessary, you my friend, unfortunately, are "s#!+ out of luck" as we say in this part of the world. Is it ethical? Absolutely not ! Is it legal? Depends on your country their laws, but in eastern Europe, it usually goes without saying, laws are pretty much a joke if you know the right people.

So, if your employer knows you have a big financial burden that you can not undertake without your current salary, and they also know, there are not many places who can pay you as much as they do (i.e. job mobility is non-existent), what would be their incentive to give you more money? Absolutely none.

I strongly advise, despite how bad it might be out there, I don't know, you start looking for new employment. Because, if you don't, your current employer will have you under the gun as long as you work for them.

And to add insult to the injury, if you have people who you can really call friends, working for the same company in a somewhat similar position, ask them how much raise they got. I am sure at least one or more of them did not have to hear the "no money in the budget for raises" bull crap and got something.

Just my observation.

Comments are not for extended discussion; this conversation has been moved to chat. — May 18 '16 at 3:18

user8365 · Answer 12 · 2016-05-16 15:42:27Z

In any negotiation, what one party is willing to accept is always a factor. Personally, I think your boss was an unethical fool for even mentioning this. If the company can't afford it, that's it, but to insinuate you're trapped in this is just a bad idea. It would be terrible if he found out you or a family member had a costly illness and he used that against you. Many would find that unethical.

There is little incentive for you to produce at such a high-level. This owner believes he is doing you a favor when in fact, you're excelling and make his business better. Take pride in being a good professional, but you don't owe this company any more than that.

Where are they going to find someone as good as you willing to work for your salary? Not everyone has a mortgage. I'm not suggesting you intentionally should hold back on your efforts. I find it difficult to want to put forth any extra effort. This owner may fire you out of spite, so be careful.

Keep checking the job markets. Many banks don't care if you change jobs as long as you stick with a similar salary and job description. You can check with them if you think it could be an issue. I don't think you owe much loyalty to someone who is so brazen to throw your financial situation in your face when asking for a well-deserved raise.

Unethical fool indeed. Your financial situation should be completely irrelevant unless the boss wants to help an employee who is in trouble through no fault of their own. And what he did completely destroys any loyalty; many employees would actually try to leave in a way causing maximum problems for the employer. — May 18 '16 at 15:34
I don't know what the mortgage contract says, but it does not seem likely that it could require you to stay in your current job or one like it. I imagine your obligations do not extend much beyond the principal one of making payments on time, and it is not in the bank's interest to foreclose so long as you are doing so. — May 18 '16 at 20:14

score 25 · Answer 13 · 2016-05-17 16:45:05Z

up vote
25
down vote

Your boss has told you, in not so many words, that the company owns you. You are a working-class slave.

If I were you, I would begin to quietly start planning my exit strategy. You are dealing with a bully, plain and simple.

"When someone shows you who they are, believe them the first time." -- Maya Angelou

edited May 17 '16 at 16:45

answered May 17 '16 at 16:34

Xavier J

26.3k104797

4

I disagree, his CEO merely stated that he has no financial grounds for a raise and that he does not see his a unbalance in his wage vs his performance
â€“Â Raoul Mensink
May 18 '16 at 12:15

6

Throwing in on disagreement with this....so much incendiary language re:slaveThe company is a buyer.The 'employee' is a seller. The company simply said it will not pay a higher price for the OP's product. OP's negotiating ability is impacted by his walkaway power and his walkaway power is impacted by his economic circumstances.The buyer thinks his intimate knowledge of the seller's finances gives him a leg up in bargaining, so decided not to flex on his price.Buyer is speculating that the OP's walkaway power is low and will have to accept a price lower than OP would expect to receive.
â€“Â K. Alan Bates
May 18 '16 at 14:47

9

Without going as far as slavery, it seems the 'buyer' is bullying OP. 'Warning' an employee finding a job might be difficult after refusing a raise is a way to say no, but not the nicest one...
â€“Â FranÃ§ois Gautier
May 18 '16 at 15:07

1

@Raoul Mensink you said "CEO merely stated that he has no financial grounds for a raise" however, this: "The CEO's reasoning was that my current salary was "more than enough" to cover living costs -- and in particular, he mentioned me as still being able to cover my mortgage payments with my current salary" disagrees
â€“Â industry7
May 19 '16 at 15:58

@industry7 could you clarify your point/argument?
â€“Â Raoul Mensink
May 20 '16 at 7:23

Â |Â
show 1 more comment

Jim 4,475623 · Answer 14 · 2016-05-16 17:21:34Z

When negotiating, it might help for you to try to address the issues, rather than fight their existence. For example you could respond with, "In the future, I hope that I am rewarded with exceptional pay for exceptional performance, not sufficient pay for exceptional performance."

If you are comfortable with your salary and you just feel undervalued, then you should probably address that along with the budget. "I understand the budget concerns. I work hard so that I can have extra income to enjoy my time out of the office more. I hope that soon there will be budget for a much better raise than normal so I can feel like the company values my work, and the raise will allow me to enjoy my time outside of work as much as possible by providing me with financial rewards greater than what I am getting now, regardless of whether my current pay is sufficient in the eyes of the company."

Besides that, while your boss knows about your house, he does not have all information. Also, who is he to judge what is 'more than enough' in terms of salary? You may have less tolerance for debt payments, expensive schools for your kids, etc.

You might also consider using additional personal tactics to encourage him to change his mind. For example, "Well, I gave up a lot of personal time and took out a loan that was larger than I was comfortable spending because I really expected a raise. I feel very let down that there is not enough budget to provide me a raise. I will probably need to make some personal changes to get through this."

I would avoid outright lying like, "The loans you know about are not the only debts we have. So this will be a very hard year for me without a raise." But if something like that happens to be true, it would be excellent to mention.

Taking this approach, in the future your boss may want to stay more focused on performance and measures of your job, rather than try to assess your personal life and personal decisions.

Good luck!

"The loans you know about are not the only debts we have. So this will be a very hard year for me without a raise." Who would take a loan based on a possible future raise? — May 16 '16 at 19:31
@Marc: Not saying it's correct behavior, but I think people do it when they win the lottery or something like that. They quit their job and/or start buying stuff before they even have the money in their pocket. I believe this is also a factor in how people become severely in debt over a period of time. I'd probably ask, who would give a loan based on a future raise? — May 16 '16 at 19:48
Someone eager to provide for their family or under family pressure to buy a house (new child arriving?) may ask for loans from friends or family, and they may hand them out. The point is, make the boss aware that he has limited personal information and probably doesn't want to know more, because then the discussion of salary is not about employee performance. That's a bad place for the boss to be. — May 16 '16 at 20:23
If the boss has already shown that he's capable of taking the low road, and has basically told the OP that he's a slave, how is any of this going to make a difference? — May 17 '16 at 16:29

score 6 · Answer 15 · 2016-05-16 15:24:05Z

Do you know for a fact that the CEO is withholding a raise because you've taken out a mortgage? It seems his explanation was that there's not a budget for one; that raises other questions which are discussed below. Not giving raises to people after they purchase homes would only work well in job markets in which there are few openings and little mobility. In markets with lots of openings and mobility, excellent performers would just find a new job if their employer stopped giving them raises after they bought homes. (The local housing market would have something to do with this too - if homes sell quickly and easily, people won't feel too tied to a location, compared to a housing market where homes stay on the market a long time before they sell.)

Is this normal? No, at least not in a robust job market, as I indicated above. However, it's not entirely unheard of. This sort of attitude is why some employers are known to prefer married workers with children and mortgages who aren't likely to job hop.

What can you do? Probably nothing positive, if finding a new job isn't a possibility (if it is a possiblity, I'd recommend it, as either your boss is treating you unfairly (and possibly dishonestly) just because you bought a home, or the company is in trouble). You said in comments that you live in eastern Europe; I'm not familiar with laws and regulations there, but it seems unlikely there is much to prevent this sort of thing; you'd need to consult a legal expert for that anyway. Otherwise, some of the ideas I can think of are:

You could question the owner about the viability of the business, since he's basically told you there's no budget for a raise for a top performer. Unfortunately, I doubt that gets you what you want if the CEO is really doing what you suggest.

You might try to have a conversation with your boss about what it will take to ensure a raise when the six month period is up (and maybe what size that raise will be). This sends the message that you definitely want to see an increase in your salary, and makes it clear what the boss wants; it also makes him obligate himself to giving you that raise.

Let me make clear that I recommend that you keep your disappointment to yourself around your fellow employees. I include the following idea to show why it would be a bad idea: You might consider spreading rumors that you were told that you couldn't be given a raise because of budget issues, implying financial difficulties for the company. Such rumors might cause co-workers to leave, freeing up financial resources to give you the raise you want. However, this is likely to create more problems than it solves: It could turn out to be true and the loss of employees accelerates the demise of the company, or the CEO could find out the source of the rumors and punish you, possibly with a firing.

I think that questioning the viability of the business would be counter-productive in negotiating salary. He can always say that the business is indeed at the limit, so we all need to make concessions (me first, of course)... — May 16 '16 at 21:19
@Elaela: It may be counter productive as a negotiating strategy, but it's important to know if your employer is about to shut down. If the boss does tell you that belt tightening is needed, then you should ask how bad things are ... and get your resume on the street as soon as you can. — May 17 '16 at 2:01
+1 for "have a conversation with your boss about what it will take to ensure a raise" --- A very good strategy. If they don't respond with detailed requirements, you might follow up with, "thank you for adding responsibilities X & Y to my position. I'm eager to add more value to the company. If I execute responsibilities X & Y, bringing new value to the company, will this be reflected in my salary after the next performance review?" In general, adding responsibilities without a raise is not sustainable, taken to its extreme you could be doing CEO work for a janitor's salary. — Apr 16 at 12:48

coteyr 8,83511433 · Answer 16 · 2016-05-16 16:46:59Z

Unfortunately your employer has both sides of the equation. That makes it a tough spot for you. Ethics is a tricky situation. A lot of people will say that you should be evaluated for a raise no matter what. Or that you should get a raise every year no matter what. I don't agree with them.

Back to your question though. It seems to me that you were given a straight answer. They don't have the budget for raises. Now on that info alone you have to decide rather or not you want to "jump ship". I wouldn't. Companies have these issues short term. I would stick it out a year and see if the raise freeze is released next year (or in 6 months).

Mentioning that "you make enough" could be an attempt to explain that what tiny budget that exists is going to go to employees that don't "make enough". Rather that is ethical or not is going to be region and circumstance specific. Personally on this front, I would be taken aback by the comment, but it also depends on circumstance. How big is the company, how many other people work there, have other things been cut. Is this person really trying to make it through a lean time, and just being (overly) honest?

What you have to decide, and only you can, is was this statement "ha, I got you now" or "look I'm trying to make this work for everyone". If your in the first situation, go look for a new job. This type of employer sucks, but will likely give you raise once they figure out they "don't have you". If it's the second, then keep a close eye out for other finical problems, but you need to decide if you want to stay there and work through the lean times, or if you want to move to a more stable company. Working through the lean times is not all bad, but it certainly has it's risks.

"A lot of people will say that you should be evaluated for a raise no matter what. Or that you should get a raise every year no matter what. I don't agree with them. " Companies refuse to give our reasonable raises... and then companies complain when their workers leave their jobs for better paying ones... — May 19 '16 at 16:01
But "reasonable" is subjective, specially when employees, in general, don't want to "give back" those raises during a lean year. So should raises be "when the company is profiting more" or "in line with inflation" or "adjusted to the regional average"? What about when those numbers go down? It there is a cost of living decrees should the employer adjust your earnings down? Reasonable is very subjective. I was simply stating that my advise comes from me, and I do not think that I company should always give a raise. Of course as an employee you always have to evaluate if your making the right $. — May 19 '16 at 17:12

user50700 · Answer 17 · 2016-05-18 11:49:57Z

It has nothing to do with employer knowning your personal situation. Even if they don't know, they still know the typical expenses of people in your situation and they still would claim that you earn more than you actually need (which is almost certainly true, people in IT earn in Eastern Europe about 2-3 times the average).

It's quite typical for employers to claim how lucky you are to have stable and secure job, and how dangerous there is outside. Is it ethical? I think most of them really believe in what they are saying, nevertheless they use fear against you.

Another observation for Central/Eastern Europe - it's much easier to find new job with higher salary then get satisfying raise for current one.

Unfortunately your last comment is quite true in western Europe too. I can't speak for anywhere else. Often the best way to get the raise that you deserve is to get another offer and use that as a negotiating point. — May 18 '16 at 11:55
@zelanix It's mostly true in the United States as well. Your wage is determined by what your second highest offer is (a function of Expected Delta MRP2). The buyer just has to pay a token more than the 2nd highest offer to price them out of the running for your product. So...the best way to increase your price is to let the market do the work for you when you can get an offer that is higher than your current one. Your current buyer will either agree to an increase in your labor price or they will let themselves be priced out of the market. — May 18 '16 at 15:20

score 0 · Answer 18 · 2016-05-19 13:25:31Z

To answer the title:

Is it unethical for an Employer to use personal (financial) information in negotiating salary?

Depends on the following:

Are you getting hired? Yes.

Are you trying to get a raise? No.

Are you getting a reduction in pay? Yes.

In your case I don't think it is unethical. You have not given any facts that he would otherwise have given you the raise would you not have had the mortgage. If anyone with similar positions is getting a raise, but for without a mortgage or loan, then it is unethical.

The warning can be taken both as concern that you could get into debt if you leave or as a way to Keep you in the Company. Unless proven otherwise I am going to assume it is the first.

Why is it ethical to do the same thing in a hiring interview that would be unethical in a performance review? I'll give you a hint - it's not. — May 18 '16 at 22:34
@HopelessN00b my personal Information is given to my employer, he has the right to use it, not abuse it. And as i mentioned there are no Facts provided that would Point to abuse. — May 19 '16 at 13:32

Graham 2,616617 · Answer 19 · 2016-05-18 10:27:12Z

I'm guessing that you work more than the "official" hours. Then a simple answer is to tell your boss that as long as you are not receiving any recompense from the company for extra work, you will not do any extra work. It's called work to rule. You can't be fired for doing just what your contract requires.

Meantime, as others have said, make your exit plans.

You can't be fired for doing just what your contract requires. You don't know that. He could live in an at-will-employment jurisdiction, or (as he's suggested) a part of the world where corruption is the rule, rather than the exception. It's entirely possible (even probable) that he could be fired for any reason at all, or no reason at all. No, as is almost always the case, it's better for you to look like a high-performing, happy, productive employee right up to the point when you put in notice or quit. — May 18 '16 at 22:33

Thomas 1 · Answer 20 · 2016-05-18 10:26:04Z

up vote
-4
down vote

Maybe you should suggest that if exceptional performance will not be valued at all then you will have difficulties in motivating yourself to perform exceptionally in the future. Since you get good money, performing "good" (which is still more than "average") should be fine...

answered May 18 '16 at 10:26

Thomas

1

3

I would be against using passive aggression in this situation (in any situation?). 'Threatening' to decrease the productivity shouldn't be on the table. Stating you disagree with the decision and highlighting you think your work deserve a better pay should be the way to go. It might imply you could go for a higher bidder or you would decrease your productivity to match the pay, but you are not threatening anyone: you just disagree.
â€“Â FranÃ§ois Gautier
May 18 '16 at 15:14

suggest improvementsÂ |Â

Search This Blog

Iyfjky

Is it ethical for an Employer to use personal (financial) information in negotiating salary?

10 Answers
10

protected by Communityâ™¦ May 18 '16 at 11:49

10 Answers
10

10 Answers
10

protected by Communityâ™¦ May 18 '16 at 11:49

Comments

Post a Comment

Popular posts from this blog

What does second last employer means? [closed]

List of Gilmore Girls characters

Confectionery

Category

Random preview

Is it ethical for an Employer to use personal (financial) information in negotiating salary?

10 Answers 10

protected by Communityâ™¦ May 18 '16 at 11:49

10 Answers 10

10 Answers 10

protected by Communityâ™¦ May 18 '16 at 11:49

Comments

Post a Comment

Popular posts from this blog

What does second last employer means? [closed]

List of Gilmore Girls characters

Confectionery

10 Answers
10

10 Answers
10

10 Answers
10