Cost Of Living Raise
- Thread starter 5.0kid
- Start date
Never got one in my 40 + years of working. Only merit raises based on my performance. Can't help.
5.0kid
Club Member
Same here ive heard 3-5%
99SaleenSpeedster
Club Member
I want to say ours is 3% per year.
DetroitStyle
Club Member
I've never seen more than 3%.
StockNotch
Forum Member
Ours is 0-3% based on performance reviews.
wrath
Club Member
We have merits only. If you don't do 85% or better on your performance review then you get a lump sum percentage. If you do really poorly you get a plan and nothing.
For those that do get a merit it is usually 2%-5.5% based on performance. The whole department gets a pool of money, usually in the 2.5-3.2% range and you divide it up based on performance. If you're a high performer paid well in a group full of high performers not paid well you get screwed vs being a low-paid high performer among a bunch of mediocrity that is well-paid.
This will probably be another year that I will get 4-5.5% and my coworker who makes way less than me anyway will be paying for my raise by not getting much of one.
For those that do get a merit it is usually 2%-5.5% based on performance. The whole department gets a pool of money, usually in the 2.5-3.2% range and you divide it up based on performance. If you're a high performer paid well in a group full of high performers not paid well you get screwed vs being a low-paid high performer among a bunch of mediocrity that is well-paid.
This will probably be another year that I will get 4-5.5% and my coworker who makes way less than me anyway will be paying for my raise by not getting much of one.
black88coupe
Club Member
I'm in a salary position but in a union- it's weird. I don't get bonuses on performance I only get what the union is able to get us when negotiations come around.
Zarken
Club Member
Had one many years ago. At that time, inflation was estimated at about 3.5% and the cost of living adjustment came in at 2%. With that being said, the one piece of advice I can give is make sure that a cost of living increase is not to replace a normal performance increase. If it is to replace it, it should be over 5%. The bad part of this is that the lower wage guys will get screwed on the percentage.
2% of $10 versus 2% of $30. That low wage guy is still fucked. So in a good situation, you may see a 15% on the low guy and a 1% on the high guy.
How is that a good situation? That would only be valid if the low-paid guy was adding more value relative to his position than the high paid guy. What if the high paid guy works his butt off and deserves a huge raise for the value he provides, and the low paid guy sits around adding no value? if it's performance based the high paid guy still gets the higher percentage raise. If it's wealth re-distribution based, then you ignore performance and give the low paid guy a bigger raise, regardless of his performance. Merit raises should not be based on the workers current wage. Now if the low paid guy performs really well, then a promotion may be in order. At that point, it may make sense to give him a 50% raise or whatever.
5.0kid
Club Member
Its not a replacement just something extra the owner wanted to start doing. We get a budget performance bonus every month and I have received many raises due to my performance. Everyone is supposed to get a quarterly review but in 6 years ive yet to have a evaluation on my skills or performance but others have and its usually to tell them why they haven't got or are not going to get a raise lol.
RyeLou
Club Sponsor
This site has decent info, specific to the Detroit area: https://www.bls.gov/regions/midwest/news-release/ConsumerPriceIndex_Detroit.htm According to what I see, break even with just an increase to cover the cost of living is 1.7% as of October. With the upward trend, I'd say about 2%. There's a note in there saying the December update will be on 1/18/17, so we'll see in 12 days.
That's good info Ryan. I wonder if that is what companies actually use to determine COLA increases. Makes sense I guess.
Zarken
Club Member
This isn't about a performance raise. Strictly cost of living. That's how "in a good situation" makes sense. You have to look at just the numbers and not the back breaking hours at a desk or in the field a person works.
$10/hr @ 40 hours = 20800/yr ~. $20/hr @ 40 hours = 41600/yr~.
If it was a blanket 2% raise to cover cost of living, which is what they are discussing in OP, then.
$10.20/hr @ 40 hours = 21216/yr ~. $20.40/hr @ 40 hours = 42432/yr~.
So the low guy gets $416/yr for cost of living and the high guy gets $832 for cost of living. You know because the higher paid guy needs more money to live off of right? And as the base wage increases so would any gains for cost of living. By making the swing offset for the lower wage guys, the companies total expense would be the same but it would improve the status of the lower guys when it comes to cost of living.
That's the main reason I stated about the separation of performance versus cost of living. If they are combined. It needs to be 5% minimum for the low guys because $8/week don't do dick for helping with bills with your new tax up there for the roads.
Yeah I see what you're saying now. It's hard for me to understand COLA because I never got one and they just seem contrary to common sense. Merit raises are the only thing that seem logical to me. Guess I'm a capitalist.
Zarken
Club Member
At the time I got my COLA, I was making over 80k. So 2% was nothing to sneeze at. Plus I was getting merrit every year. With that being said, My current field allows me to be in direct control of pay for the people actually doing the work on the floor. And because I interact with them on a daily basis, that is why my thought path for COLA with higher percentages to the lower wage guys is the way it is. And for my group of guys, it actually saves the company money on the big end. But at the end of the day, I want my money too! So I do my best to keep the guys doing the labor happy so that my pay and bonus keeps growing to make me happy.