How to Provide Raises in a Challenging Economy

By Jim Thomas
February 7, 2011

I speak with many health club owners and operators regarding concerns they have about handing out pay raises when economic times are tough. Although some would like to use the economy as an excuse to not offer raises — even when they are merited — pay raises are essential to retaining talented people. Here are 10 ways to give raises during challenging times, with a focus on production and job descriptions.

Give staff members responsibility for certain budget line items. For example, if the budget for towel service is $2,000 per month, any savings employees can generate in that line item could result in a 50 percent bonus off the total savings. So if someone saves the club $500, he or she would receive a $250 bonus.

Acknowledge that additional compensation does not have to come in the way of direct dollars. Give employees a half-day off, but pay them for the full day.

Make childcare (if your facility offers it) free for employees' kids. Or at least reduce the cost. This offers significant savings for employees with children, as well as the added bonus of convenience.

When possible, offer flexible scheduling. This is another nice perk for those workers with children.

Realize that every employee, regardless of department, is in sales. Have a commission plan for every worker, and teach each one how to promote and sell.

Offer more training and continuing-education opportunities. This will make workers more valuable while also increasing their confidence and self-esteem.

Sponsor monthly contests. A sales contest works, but you could also have a cleaning contest based on daily inspection scores. How many more memberships would you sell, or how many additional members would you retain, with a cleaner facility?

Combine duties. When someone leaves your facility, instead of hiring someone else, take a look around and find a current employee who deserves more money and can pick up some of the vacated duties.

Look at employees as your most valuable asset, not as necessary expenses. You'll be pleasantly surprised.

Remember that you get what you pay for. Hiring people at low wages who are not qualified for specific roles will wind up costing you more in the long run. So go give a deserving employee a raise!