What To Do When You Find Out A Coworker Makes More Money

Melanie Pinola Aaargh! You just found out that your coworker makes more than you do, even though you both do the same kind of work, you’ve been there longer and you do a better job. You feel demoralized, insulted by your employer and resentful of your coworker. Before you protest, here’s how to handle the situation professionally.

Annoyed coworkers picture from Shutterstock

Although it sucks to find out you’re not making as much as your coworker(s), the upside to this newfound knowledge is you can use it for positive change, whether you improve your job skills, get motivated to ask for a raise, or find a better job. Stay calm and follow these steps.

Step One: Assess the situation and don’t flip out

Your gut reaction might be to gripe about the situation to your manager or fellow coworkers, but take a step back to thoroughly think about it. As frustrating as it is, there might be fair reasons why your coworker earns more than you. Perhaps the market value or demand for the job has risen since you were hired, so the company had to offer more to newer applicants. Psychologist Art Markman says on Forbes:

[It] is actually quite common where people hired after you may end up making more money. While there is always the chance that this is related to gender, it may also reflect market forces. If you were hired in a softer job market, then you may have gotten a lower offer, because that was what the market would support. I see this a lot in universities where faculty who have been working at the university for many years may be getting paid about the same (or sometimes even less) than brand new hires, just because the market has gotten competitive.

I raise this potential explanation, because when you discover that you are being paid less than others who are doing a similar job, it is natural to assume that salary inequalities are a result of more nefarious forces. The problem with that assumption is that, if your company ultimately does agree to give you a raise, you might still walk away with a bad feeling.

So before jumping to conclusions, take stock of the situation. If you didn’t negotiate your salary well (or at all) but your coworker did, that could also explain the salary difference (even though that might not seem fair). Perhaps your coworker has more job responsibilities or additional qualifications like more up-to-date skills (which happens a lot in the IT world).

Once you’ve found the most likely reason for the salary difference, you can take steps to address it. You could take classes to improve your skill set, for example, or ask for additional responsibility so you’re on even ground with your coworker or new hires.

What if there doesn’t seem to be a fair reason why your coworker makes more? As with other situations where you feel you should be earning more, get ready to negotiate a raise. We’ll talk about discrimination and pay inequality — another possible reason for salary differences — in the last section below.

Step Two: Research how much you should be making and ask for a raise

Putting your coworker’s salary aside, you should know your value as an employee. This is a crucial step when you feel underpaid (and overworked), so you can be armed with the data that can help you get a raise — or decide whether or not to look for a different job. Several salary search sites can help you find the fair market value for your job, based on your location, experience and education level. One resource worth checking out is PayScale, a free service that can tell you the average pay for your profession in Australia.

Once you know how much you could or should be making, ask for a raise, but don’t use your coworker’s salary as the reason why you deserve it. Keep the focus on your performance instead of comparisons between you and others.
While there’s nothing inherently wrong with pointing out your knowledge of what others in the company are making, it can still piss off management, as some Lifehacker commenters have noted. If you work at a company where salary sharing is taboo, this might not help your case. Approach your raise request like you would in other situations where you feel like you deserve more.

Here are some other tips to help you when asking for a raise:

If you get a raise and compensation seems fair, great! Mission accomplished. If not, read on.

Step Three: Consider looking for a new job or taking legal action (if appropriate)

If your raise is denied, there are still things you can do to make the situation feel fairer to you. Consider asking for other benefits, like flexible hours or working from home (which can be the happiness equivalent of a multi-thousand dollar raise). You could also ask your supervisor what you could do to increase your pay and ask for a performance review a few months later.

When you feel like you deserve or need a raise, however, you should be prepared to quit if it doesn’t happen. But base your decision on what the job is worth to you, rather than what your coworker is getting paid.

If you believe you’re a victim of discrimination, you can file a complaint with the Fair Work Ombudsman. As the organisation’s website explains:

Unlawful workplace discrimination occurs when an employer takes adverse action against a person who is an employee or prospective employee because of the following attributes of the person: race, colour, sex, sexual preference, age,
physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.

The case for open salaries

There are clear reasons why employers want to keep salaries secret, though — clear reasons that benefit them more than us. It’s tough when learning salary secrets can make you feel undervalued, but until your company adopts an open salary policy, your best bet is to always push for a salary that you know is fair for the work you do — or walk or sound the alarm if it is an issue of fairness.