The New Person At Work Is Getting Paid More Than I Am! How Can I Handle It?

Bea wrote in with the following story:

I work at a small office and we have lost two employees this year….one left for more salary and benefits and another because they were moving out of state. While I was training one of the new replacements she mentioned her salary, which was $2 an hour more than my own. Now this person’s responsibilities will be equal or less than my own and I have eight years invested in my current position. I decided to discuss this with my boss and this did not go particularly well. I asked for a raise that would at least equal the new employee’s. I was told that I recently had a 50cent/hour raise and that business is slow and that my request could not be granted. When I pointed out the salary discrepancy between my salary and the new employee I was told that it had been difficult to fill the position and my boss had to meet this person’s requirements in order to fill the position. In that case I said I would be giving notice. My boss asked me to reconsider and she would think about raising my salary in 6 months. She asked me to think about it and let her know Monday.

So my question is, how have others in similar circumstances dealt with a situation like this? Any advice for me? Hubby supports my decision to leave if no increase in salary is given, we’ll tighten our budget and deal with it .We currently live on my husband’s salary and use mine for additional savings and the little things that come up.

Let’s isolate the facts here: an employee with eight years’ experience is training a new worker to do a very similar job. This new worker is getting $2 an hour more than the experienced one. When the experienced worker requested a raise, the boss essentially said no and justified the high pay for the new worker by saying the position was hard to fill.

If the boss is telling the full truth about the reason for hiring the new worker, then if the experienced one quits as well, it will cost the company significantly. Not only would they have to hire someone at the higher rate of the new worker, there would also be costs associated with training, plus the loss of productivity associated with moving from an old hand to a new one.

In this case, it pays to play hardball. It makes business sense for that person to pay Bea at least the same as the new worker if she requests it. It also makes business sense for the business owner to not pay Bea the higher rate, but given the alternative of losing an experienced worker, the business owner would decide in favor of the raise.

This, of course, assumes that the business owner is playing fair and also that Bea has a good work record to this point. If either of those assumptions fail, it’s quite possible that Bea could walk out of the job. My feeling is if the situation in the workplace is such that this raise request isn’t met, then it’s probably not a long-term healthy situation. The business owner was able to pay the new worker more – and it would presumably cost that much to fill Bea’s slot – so if Bea is let go, that means the business owner isn’t playing fair (not good) or the business really is in trouble (not good).

Since Bea would be able to quit and survive, my advice to Bea is to keep playing hardball if you believe you are valuable to the business. If you have a good work record and have a plan if you were to lose the job, I would stick to my guns. The other option is to cave, but by doing that, you’re (arguably) making yourself appear like a doormat and likely minimizing potential future pay increases (because the boss will see that you won’t fight for a raise – and thus why should you get any?).

Are there any other suggestions for Bea?

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.