Promotion without a raise is more common in Singapore than expected

For many in Singapore, taking on more responsibilities doesn’t necessarily score them a pay rise. An annual study done by Robert Half has indicated that only “17% of Singaporean companies always provide a pay rise following a promotion”.

Interestingly, the study also showed that medium-sized companies (21%) are more inclined to give pay rises with the promotion, as compared to large companies (15%). This may be due to the fact that 43% of these companies would like to “assess a promoted employee’s performance before offering more pay”.

Other reasons for companies not giving the pay rise include lack of financial resources (22%), needing the job to be filled urgently (11%), followed by remuneration being too high for the previous role (7%).

Matthieu Imbert-Bouchard, managing director, Robert Half Singapore, said: “While receiving a promotion is a clear sign of confidence in an employee, taking on a more senior role and more responsibilities without getting a salary increase can negatively impact an employee’s motivation which in turn can influence their decision to change jobs.”

“With Singapore’s tight labour market and low unemployment rate, and in order to hold on to their top performers, employers need to reward their best employees by giving them career advancement opportunities. However, pay rises are a very effective retention tool. Many employees are prepared to work hard knowing the reward will be a promotion with a better salary and bonus.”

“When employees don’t receive a salary increase when promoted, it is vital to explain the reason, as well as potential targets that the employee needs to reach within a certain timeframe in order to receive a salary rise.” In such situations, Imbert-Bouchard encourages the use of “non-financial benefits”.

Photo/ 123RF