Prepare for a compensation conversation.

Pay conversations are often the ones managers feel least equipped for. Fill in the context and answer five questions. You'll get a prep sheet that helps you walk in clear and grounded.

Question 1 of 5

Who is this conversation with, and what's their role?

Name and role — enough to personalise what comes next.

Question 2 of 5

What type of conversation is this?

Pick the one that best describes what you're walking into.

Context

Their compensation picture, before you go in.

Fill in what you know. Leave blank what you don't — but the more complete this is, the more grounded you'll be in the room.

Start date

Time in this role

Seniority / level

Last pay increase

Market benchmark

How does their pay sit relative to the market for this role, level, and location? Even a rough range matters — it changes what "fair" means in the conversation.

Internal pay comparison

What do others doing equivalent work earn here? Include where you can — level, tenure, and if you know it, gender.

Gender pay gaps usually happen through individual decisions — like this one — not through company policy. Check where this person sits before you go in.

Younger employees are increasingly likely to talk openly about what they earn. You can't stop it, and you shouldn't try. Make sure the picture is one you'd be comfortable with.

Question 3 of 5

What's the decision or situation you're going into this conversation with?

Be specific — the number, the band, the constraint, what was approved. Vague prep leads to vague conversations.

Question 4 of 5

How do you think they'll receive it — and what are you most worried about?

Name your honest read. If you're expecting disappointment, relief, or pushback — say so. It changes how you prepare.

Question 5 of 5

What's the one thing you want them to leave feeling clear on?

Not what you want to say — what you want them to understand. There's a difference, and it matters.

Compensation Prep Sheet

Conversation with —

The Person

Who you're going into this with

Context

Their compensation picture

The Situation

What's decided — and what context they need

Their Likely Response

Your honest read going in

The One Thing

What you want them to leave understanding

Opening

How to start the conversation

Before you go in

Record this conversation →

Resources

Frameworks, language scripts, and guidance for every kind of pay conversation. Open what you need.

Before any compensation conversation. The clarity you bring in is the clarity they can leave with.

The number or decision is confirmed — you're not going in to discuss, you're going in to communicate
You know what's in and out of scope — what can change and what can't
You understand the band, the process, and the context well enough to explain it simply
You can name the path forward — what would change the outcome next time
You've thought about how they're likely to react and have a response ready
HR is looped in if needed — especially for sensitive cases or equity concerns
Private setting confirmed — never in an open plan space or back-to-back
Enough time blocked — 30 minutes minimum, 45 if it's likely to be difficult
You're not going in with unresolved personal feelings about the outcome

Each type of compensation conversation has a different centre of gravity. Knowing which one you're in helps you prepare the right thing.

Delivering a pay review

Lead with the outcome, then the reasoning

State the outcome clearly at the start — don't build to it. People can't process the reasoning until they know the number. Give the increase (or explain the no-change), then explain what drove it: performance, market data, band position, or budget. End with what the path forward looks like.

"I want to start with the outcome: your salary is moving to [X] from [date]. Let me explain how we got there and what it means for where you sit in your band."

Responding to a raise request

Take it seriously before you respond to it

Acknowledge the ask before you answer it. Ask what's driving it — is it market data, a life change, a feeling of being undervalued? Understanding the source changes how you respond. If the answer is no, explain specifically why, and name what would need to change for the answer to be yes.

"Thank you for raising this directly — it's the right thing to do. Can you tell me more about what's prompted this conversation? I want to make sure I'm responding to the right thing."

Explaining a no-increase outcome

Be honest about the reason — don't soften it into vagueness

Vague explanations feel like deflection. If the reason is budget, say that. If it's band position, explain the band. If it's performance, say so clearly and make sure this isn't the first time they're hearing it. Then name — specifically — what a different outcome would require.

"There's no increase this cycle, and I want to be honest about why. [Reason]. That's the real answer. Here's what I think changes it: [specific path forward]."

The "am I paid fairly?" conversation

Don't dismiss it and don't over-promise

This question usually means something — a comparison they've made, a market check, a feeling of being undervalued. Ask what's behind it before you answer. If you genuinely don't know how they sit relative to the market or the team, say so and commit to finding out. Don't guess and don't make promises you can't keep.

"That's an important question and I want to give you a real answer. Can you share what's prompting it? And if I don't have everything I need to answer it fully today, I'd rather come back to you with the right information than guess."

Ready phrases for the moments that usually get muddled. Edit to fit your voice.

Opening — when the outcome is good news

"I want to start with some good news. Your salary is moving to [X], effective [date]. I'm really pleased we were able to make this happen — I think it reflects what you've contributed this year. Let me walk you through the thinking."

Opening — when the outcome may disappoint

"I want to be straight with you about where things landed. [Outcome]. I know this may not be what you were hoping for, and I want to take the time to explain the thinking properly and make sure you have the full picture."

When they say "that's not enough"

"I hear you, and I'm not going to dismiss that. Can you help me understand what you'd need it to be — and what's driving that number for you? I want to make sure I understand your side before I respond."

When they bring up a colleague's pay

"I'm not able to speak to what others earn — that's not information I can share, and I wouldn't want someone sharing yours either. What I can do is explain clearly how your pay was determined and where you sit in the structure. Let me do that."

When they mention a competing offer

"I appreciate you telling me — it takes courage to have this conversation directly. I want to understand what's driving it: is it primarily the money, or is there something about the other opportunity that's appealing beyond that? I want to give you a real response, not just a reaction."

Naming the path forward

"I want to be specific about what a different outcome looks like, because I think you deserve a real answer — not a vague 'keep doing what you're doing.' Here's what I think would need to be true: [specific criteria]. That's what I'll be looking for, and I'll tell you directly when I see it."

Pushback in a pay conversation is normal and usually means the person cares. The goal is to stay honest and grounded — not to win, and not to cave.

If they get emotional

Give it space before you respond

Pay is personal. Disappointment, frustration, even tears — these are normal responses to news that feels unfair. Don't rush to reassure or pivot to logistics. Say something human first: "I can see this is landing hard. Take a moment." Then continue when they're ready.

"I don't want to rush past how you're feeling right now. This matters to you — I get that. Let's take a breath and then I'm happy to go through the detail or answer whatever is most useful."

If they say the process is unfair

Don't get defensive — get curious

Ask what specifically feels unfair. Sometimes there's a real concern worth taking back. Sometimes it's frustration looking for an outlet. You can acknowledge the feeling without agreeing with the premise: "I hear that this doesn't feel right to you. Help me understand what specifically feels off."

"I'm not going to dismiss that. If there's something in the process that wasn't fair, I want to know. Can you be specific about what you mean?"

If they threaten to leave

Take it seriously without panicking

Don't make promises in the room that you can't keep. Don't dismiss the signal either. The right response is honest: "I hear you, and I don't want to lose you. I'm not in a position to change the outcome today, but I want to understand what would need to be true for you to want to stay — and I'll take that seriously."

"I'm glad you're telling me rather than just deciding quietly. Can we talk about what staying would need to look like for you? I can't promise outcomes, but I can promise to take it seriously."

One of the biggest mistakes in pay conversations is over-promising under pressure. Being clear about what's in and out of your hands protects both of you.

Things you can commit to

Within your control to follow through on

You can commit to: being specific about what a different outcome would require; revisiting the conversation at a defined future point; advocating for them in the next cycle; sharing what you know about how pay decisions are made; following up with information you don't have today.

"What I can commit to is this: I'll review this with you again in six months, and I'll be specific between now and then about what I'm seeing."

Things you cannot commit to

Outside your control — say so clearly

You cannot commit to: a specific outcome in the next cycle, what someone else earns or has been offered, changing a decision that isn't yours to change, guaranteed promotion timelines, or matching any external offer without going through the right process. Vague over-promises damage trust more than a clear no.

"I can't promise you a specific number next time — that depends on factors neither of us fully controls. What I can promise is that it won't be because I didn't make the case."

When you genuinely don't know

Say so and commit to finding out

If they ask something you don't know — how they compare to the market, what the band ceiling is, whether a mid-year review is possible — say you don't know and name when you'll come back. Guessing in a pay conversation creates confusion that outlasts the meeting.

"I don't have that answer right now and I'd rather be honest about that than give you something inaccurate. Let me find out and come back to you by [date]."