Why won’t your company give you more money? Your HR knows but can’t always tell
One of the most important concerns for all employees is money. Let’s face it, that’s why you’re working, right? The number of people who have other sources of income and work only for pleasure is very low. Most of us work for money: to support our families, to buy a house, to buy a car, to buy nice things, to go on vacation, to prove our social status, to feel important…
I’m also sure you must have tried at least once to get more money at some point in your career, and you did it by going to your manager, quitting your job and getting a new one, or applying for a promotion. Many times you have been told NO when you asked for more money. Have you ever wondered why? I am sure that you have… the reasons are multiple, but I will deal here with those that have come from the background. Let’s start…
1. Huge social taxes that companies pay to the state. In addition to your base salary (of which you pay some income taxes), the company is also burdened with other taxes on wages. Sometimes just for you to get 1 USD or 1 Euro or whatever, your company needs to pay 2 more to the state. This is overwhelming and sometimes companies pay money to employees on the black payroll just to avoid those taxes. It’s not pretty because those taxes go to the Retirement Office, the Health Office or the Unemployment Fund for the unemployed, but sometimes companies have to do it to survive. Here are some examples of taxes paid in Europe: United Kingdom and France – 26% (ie for every 100 pounds or euros in the employee’s contract, the company pays 26 more to the state), Germany and Austria – 30%, Italy – 32%, Norway – 36%, Denmark – 41%, Belgium – 43%; These are all huge amounts for a company to handle.
2. Global company policy to reduce costs: It no longer surprises anyone that companies exist for profit, not for charity, not to make employees happy, not to make the world a better place: profit He is the king. So don’t be surprised when a large corporation announces that it is closing a 2,000-employee plant in Western Europe to relocate to India. Imagine that you work in France, you have asked for a salary increase but they simply do not give it to you. Do you still wonder why? Well, think that employees in India accept salaries 10 times lower than yours and they are happy. Don’t be surprised if in a year your job will be transferred there. Eastern Europe and India and now hot spots because of the low level of wages that people accept. Sometimes it goes even further. Renault: Dacia in Romania has unofficially started to think about moving its plant to Morocco because Romanian workers have asked for more money and the costs in Morocco are even lower than in Romania: workers in Romania earn around 300 euros a month. Guys in France, what do you say? 300 euros began to be considered too high for the company to be profitable. Sad no? But let’s be real: the group doesn’t care about any of you in France, Romania or Morocco. They only strive for profit. If Mars becomes more profitable, they’ll find a way to move there.
3. Global company policy to reduce the number of older employees: This is sad and worrying, but it happens. I must admit that this measure is currently closer to me than you think: this is the goal of our HR department for this year. The idea is to accept a certain attrition/turnover rate just because it means older, more experienced, higher paid employees will be replaced by young people who are just learning and obviously earning less. Nobody cares that all these people need to be recruited and trained. It’s not the job of VPs or senior management, it’s the job of local managers and HR and as long as the profits and money keep coming in, which VP do you think cares? If they’re on their yacht somewhere in the Caribbean, they don’t care. Do you understand now why you are not receiving more money? Keep asking and asking and you will be welcome to leave. They will replace you with someone who will accept less money.
4. Top managers get annual bonuses as a percentage of company savings. This is worrying but true. I have faced it at one of my previous companies where management used to cut a lot of the salesperson bonuses just to increase the annual savings. Everything in the company was tightly controlled, even the office supplies. This is a fact and it happens around you more than you think. And since your manager can get a higher bonus if he saves more, do you think he’s motivated to give you a raise? Stop dreaming…
So guys, excuse this bitter article – this is just a dose of reality for those who still dream of a rosy corporate world. Wake up! Does not exist. No one (except those who work around you: your colleagues, sometimes your direct manager, your local HR department) cares. You are just a small cog in the corporate mechanism that produces profit. You’re replaceable if you break down…
We’ll be back soon with a more upbeat article.
Take care of yourself,
Geo