Michigan Labor & Employment Law Blog

A similar article, also in the Wall Street Journal, reported that there is a proactive strategy in place among many companies now to pay as much as they can afford to keep their employees so that they do not have to go through the pain of looking for replacement employees after having lost good employees they have invested time, money and training in. One company in Jamestown, New York reported that while in the past they have typically given 1 and 1.5 to 3 percent raises, they are now considering 10 percent annual raises as a proactive effort to keep their best people.

In Southeast Michigan, this problem is particularly true in the customer service and hospitality/restaurant industry. With the opening of new restaurants on an almost weekly basis in Oakland, Macomb and Wayne counties, the hospitality business is incredibly chaotic at the moment with servers, bartenders, cooks and others jumping from employer to employer as there is a feeding frenzy for the best employees.

So the question to repeat again: Are you paying your employees enough? This is not a legal question but a very practical one. If you have good employees that you need to keep in order for your business to grow and survive in this economy when there is a shortage of people with desirable skill sets; do not be penny-wise and pound-foolish. We suggest you may need to pay as much as you can possibly afford to keep the right people in the right places.

For additional questions regarding this issue, please contact a Foster Swift Employer Services Attorney.