A pay rise matters. But knowing what pay is based on matters more

THESIS: For employees, what matters most is understanding what they are paid for and why they are paid this particular amount. A one-off pay rise may calm tensions for a moment. Clear criteria help prevent them from returning.

The paradox of employee expectations

This result says a lot about the current labour market. Employees are asking for rules, not only for higher amounts. In the report Polish Employees on Pay Transparency and Pay Fairness, the most frequently indicated actions were clear pay criteria, transparent bonus rules and clear promotion criteria.

So the problem is often not the salary level itself, but the lack of an answer to one key question: “Where did this amount come from?”. This has a strong business impact because the data shows clearly that a low sense of pay fairness increases the risk of employee turnover and declining motivation. Pay unfairness may be subjective in its experience, but its financial consequences for the company are very real and measurable.

Procedural fairness in HR practice

Does that sound like a paradox? In practice, procedural fairness explains it well. People can accept even difficult decisions if they believe the process itself was fair. They want to feel that they had a chance to present their perspective, that the rules were consistent and that the decision was handled seriously and respectfully. When they do not understand the process, trust declines regardless of the amount shown on the payslip.

Companies often make a costly mistake here: they try to cover up an unclear process with a pay rise. Money may reduce tension for a while, but it does not solve the underlying problem. If decisions remain discretionary, inconsistent, or poorly explained, frustration returns after a few months. Only then is the pay-rise budget smaller, and trust is no stronger.

Three pillars of perceived fairness

A sense of fairness and lasting trust in the system are built on three elements: clear, measurable criteria; consistent application of the same rules across departments; and communication that clearly explains decisions.

Well-structured criteria have one more advantage. They help the company defend its decisions before employees and during an audit. With the burden of proof shifted to the employer, it is no longer enough to say, “That was our decision.” The company needs to show what the decision was based on. That is why clear criteria are not a formality, but real protection for the business.

How to implement this without giving everyone a pay rise

1. Start with a pay gap diagnosis – the first step is not a pay rise budget, but checking where inequalities actually exist in the company. Pay gap analysis shows which groups, roles or departments require attention and whether differences can be justified by objective criteria.
2. Organise roles and pay rules – the next step is job evaluation, which means establishing a hierarchy of roles based on work value, responsibility and competencies, not on job titles, historical decisions or organisational habit. On this foundation, the company can build a pay structure, salary ranges and clear bonus rules. 
3. Document decisions and prepare managers for conversations – even the best system will not work if no one can explain it. Pay decisions need to be documented, and managers need clear arguments for conversations with employees. This helps the company reduce the risk of disputes and build greater trust in the system.

WHAT THIS MEANS FOR YOUR ROLE

HR: shift the focus from the pay-rise budget to the criteria architecture.

Comp&Ben: job evaluation + consistency = defensible decisions in front of employees and during an audit.

Leadership team: well-structured rules mean lower turnover and more predictable costs.

A one-off pay rise may calm the fire. Clear criteria help prevent the fire from starting. Organizations that confuse the two end up paying for it.