"Help, my team want's a pay rise, but there's no budget"
What to do to keep them motivated
Hey team,
This weekend I did something I’ve not done in a long time… Spent a full 5 days away from work.
That’s the power of watertight systems and a team that doesn’t just “hold the fort”, but that makes things better in my absence.
It’s what every manager should be aiming for: leading in a way that creates freedom and resilience, so you get to really switch off (because you bloomin deserve it).
Tomorrow I’m back in the office, feeling refreshed AF and ready to dive into our Custard beta launch. We’ve got 20 incredible businesses joinig us, and I can’t WAIT to show you the results.
Now, let’s talk pay rises
They’re more than just money, they’re a symbol of fairness, respect, and care.
In every small business I’ve worked in (including my own now), I’ve always done 6-monthly pay reviews and can confidently say I pay over the odds to keep great people. They’re worth it and they deserve it.
And I will keep fighting the good fight with senior leadership to pay their teams more fairly.
But the annoying truth is, as the managers, we don’t always get a say. Often, we have little or no control over the raises our team gets. Then even when you do give someone a raise, it’s rarely the magic pill you hope it will be. The buzz fades fast.
What actually lasts is how people feel at work every single day.
So when your team asks about pay rises and there’s no budget, I know it’s frustrating, but don’t panic.
Here’s what we can do for them instead, and it might matter more than you think.
What to say when they ask for a pay rise (but you can’t give it)
The most important thing for me here is transparency.
Please never string your team along with false promises. We’ve all been on the receiving end of that, it’s often done with best intentions, but it’s manipulative and unfair.
Instead, we need total transparency, something like:
“You’re absolutely right to ask. Pay matters. At the moment, the budget isn’t there, and I don’t want to disrespect you in any way with false promises. What I can do is make sure we keep your development moving, and look at giving you the flexibility you need to thrive here. And as soon as we’re in a position to revisit pay, you’ll be first in line.”
Then let’s focus on what we could do to keep their morale high…
1. Recognition
Research shows, that once your basic needs are covered, money stops being the thing that keeps you in a job. What really matters is the non-financial stuff: praise, appreciation, feeling like your work is valued.
YET, the number of workers who say they’ve been praised in the last 7 days just hit a 15-year low??? So then, if recognition is free, powerful, and proven to keep people engaged… Why aren’t more managers using it?
Imagine smashing a project deadline, pouring in extra hours, and then… silence. No comment or thanks. Then over time, it eats away at motivation more than the size of your salary ever could.
Recognition is simply the small, frequent thank-yous that build lasting engagement. And in my experience, the managers who are best at this are specific.
Moving away from “good job”, and instead saying, “The way you handled that client’s objections in the meeting was sharp, you kept the deal moving.”
Recognition is free. It just takes paying attention.
2. Growth
If pay isn’t moving, progress has to.
I’ve seen brilliant managers keep people engaged for years simply by creating stretch, variety, and learning.
It doesn’t have to be formal training programmes. It can be:
Pairing them with someone more senior for shadowing.
Rotating them onto a different type of project.
Asking them to lead a client presentation or internal initiative.
3. Belonging
You could pay someone above market rate, but if they feel excluded, ignored, or disconnected, they’ll still be scrolling LinkedIn job ads on their lunch break.
I know cuz I’ve been that person.
Belonging is built in the little things. As managers, we must carve out time to learn about the people in your team, their diverse opinions and experiences. Learn what they love and what they hate. Learn about their passions and their dreams.
I’ve seen teams transform morale just by starting a Friday ritual: 15 minutes in the calendar, everyone brings one win and gives a shout-out to someone else.
It seems so, so simple yet so few managers ever do it.
It creates a rhythm of connection. It tells people: “You matter here.” and “We care more about the numbers”
Final Thought
Pay rises keep people content in the short term. But what truly keeps them energised is feeling seen, growing, and belonging.
But no one teaches us managers how to do that. You’re thrown in, expected to figure it out on your own, while juggling deadlines, KPIs, and your own self-doubt.
That’s exactly why I built Custard.
It’s a manager intelligence platform that tells you, every single week, exactly how your team is actually feeling, and what to do about it.
If you want to be the kind of manager who keeps great people without needing a big budget to do it, join the Custard waitlist for all the juicy info.
All the best,
H