Is there a right to a salary increase due to high inflation?
As the job portal Indeed reports, employers are currently not obliged to compensate for inflation with a higher salary. Even the Inflation Compensation Act drafted by the Federal Ministry of Finance does not change anything. This is an increase in the basic allowance, which means that taxpayers will have to pay less wage tax from 2023. The employee’s initiative is therefore required to negotiate a good compromise. Usually, a salary increase takes place after the successful completion of the probationary period, when a new employment contract is concluded, a fixed-term contract becomes indefinite, the area of responsibility increases or you are transferred or promoted and given more responsibility. A salary increase due to increased inflation is therefore unusual.
Why you shouldn’t use high inflation as an argument in salary negotiations
The job portal kununu strictly advises against using high inflation as an argument for a salary increase. But why? After all, the value of the salary falls due to the high inflation, so it seems only fair to demand compensation? What you should keep in mind, however, is that in this economic situation, companies are also heavily burdened. Because they too suffer from higher costs for energy, transport and logistics. Energy-intensive companies in particular are hit hard by high energy prices and may not even have the means for a salary increase. Nevertheless, the best way to convince here is with the performance provided.
A salary increase due to inflation could also be planned anyway and not lead to the desired relatively higher salary: Four out of ten employers are planning to increase their employees’ salaries more than planned despite or precisely because of the difficult situation, according to a survey by Willis Towers Watson Has.
How do you start a salary negotiation?
First, Indeed recommends doing some research on average salaries in the industry and what would be appropriate for the position and qualifications. You should also specifically name your successes in order to convince your manager of your value for the company. Of course, concrete data and facts work best here – this also makes counter-arguments on the part of the company more difficult, for which one should definitely prepare. Finally, of course, you also have to consider the company’s economic opportunities and not only prepare for good arguments, but also for proper negotiation about the new salary.
Editorial office finanzen.net
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