How to Talk to Your Employees About Salaries: A Manager’s Guide

Why is salary negotiation important? Because it directly shapes trust, engagement and retention across the business. Salary negotiations are some of the toughest conversations managers face. They often come up in reviews, promotions or retention talks, moments when recognition matters most and the conversation carries real weight. Because these discussions can heavily shape the employee experience, they often feel complex to navigate, especially when managers are balancing expectations with business needs.  When they’re avoided, frustration builds, disengagement follows and attrition becomes a real risk.

Clarity, empathy and preparation make the difference. Before the meeting, review pay structures and market benchmarks to build credibility. Use resources, like our Salary Guides , to gain industry insights and understand salary trends, so you can be confident when speaking with your team members. During the conversation, listen actively and communicate openly to strengthen trust. Afterward, follow up quickly and reinforce recognition to keep motivation high.

Several factors can influence the outcome of salary negotiations. Here are the key takeaways for managers in the Middle East to keep in mind:

• Salary negotiations shape trust, engagement and retention across the business.
• Preparing with performance reviews and market benchmarks builds credibility before pay talks.
• Communicating with transparency and empathy strengthens relationships during salary discussions.
• Highlighting the full compensation package balances expectations beyond base pay.
• Anticipating common scenarios helps managers respond with confidence.
• Following up with clear summaries and next steps maintains motivation and clarity.
• Salary conversations reinforce recognition, transparency and long-term loyalty.

 How Managers and Team Leads Can Prepare for Pay Talks and Negotiate Salary

Preparation sets the tone for a constructive conversation. Managers who come prepared demonstrate respect for their employees and build trust.

Practical steps to prepare:

• Review performance: Assess achievements, contributions and areas for growth and revisit the employee’s contract and job description to ensure expectations and responsibilities are up to date.
• Know your pay ranges: Refresh your knowledge of company guidelines and policies, and confirm any relevant budgeting, timelines or approval processes before entering the conversation.
• Do market research: Benchmark salaries against industry standards so you can speak confidently about where the role sits in the wider market.
• Anticipate questions: Consider what employees might raise, from workload and career progression to compensation history or upcoming deadlines, so you’re ready to respond with clarity.

When managers prepare well, they’re better equipped to lead the conversation with confidence and credibility.

How to Discuss Salary: Employer Tips for Negotiation

This is where communication skills matter most. Managers should balance transparency with empathy, ensuring employees feel heard and valued. 

Key principles to keep in mind:

• Be clear and transparent when communicating.
• Connect pay decisions to performance, business objectives, and objective criteria that make sense for each role.
• Discuss the total compensation package (salary, benefits, perks, flexibility)., flexibility)., flexibility).
• Show empathy and listen actively.

What to communicate clearly:

• Salary ranges and how they are determined.
• Factors influencing salary increases (performance, market benchmarks, budget).
• The objective criteria used to evaluate performance and how they apply to different roles.
• Opportunities for growth beyond salary (training, career progression).

Salary Negotiation Scenarios and Responses

To bring these ideas to life, here are a few examples of real‑world pay conversations and ways managers can respond with clarity, empathy and confidence.

1. Employee requests a raise beyond budget

“I understand your request and value your contributions. Our budget limits base salary increases right now. We can look at other benefits, such as flexible work or professional development.”

2. Employee compares salary to market data

“You’re right to bring this up. Our internal pay structures show the typical salary range for this role. Let’s look at how your current package fits and what steps we can take to close any gaps.”

3. Employee pushes back on an offer

“I hear your concerns. Let’s go over the full package, including benefits and career progression. We want it to meet your expectations while staying aligned with business policies”

Salary Negotiation Process: Employer Follow-up Steps

The conversation doesn’t end once a decision is made. Follow-up is critical to maintaining trust and clarity.

Best practises for follow up:

• Summarise agreed points in writing.
• Outline next steps (performance goals, timelines for review).
• Recognise employees’ achievements so they clearly understand how valued they are.
• Keep communication channels open for future discussions.

By providing clear follow-up, managers show that salary discussions are part of an ongoing dialogue, not a one-off event.

Salary Negotiation Strategies: Tools for Managers to Succeed

At Michael Page, we give managers the tools to succeed. Our Salary Guides offer clear salary benchmarking, pay comparison and practical insights that help you approach pay discussions with confidence. 

Download the UAE Salary Guide today and prepare for your next conversation.