August 11, 2022

MEGANEGANE

Just Do It

Employees Struggle With Inflation. CEO Responds With

If your employees are trying to survive under constant inflation, what’s the best thing to do? Howard University Hospital CEO Anita L.A. Jenkins chose to give helpful budget-saving tips to her employees, sending out an email to staff. The email was posted to Reddit’s r/nursing subreddit, and it has some good points:

At Howard University Hospital, I want you to understand that we are carefully managing our dollars. Now more than ever, we must be conscious of what materials we buy and how much we spend. We must also be careful with our current hospital resources…we must be prudent with the resources that we have.”

If she had left it at that, it would have been fine, but she went a step further and gave tips on how employees could save money at home. Registered Nurse and activist, Sarah Warren, shared her thoughts about how Jenkins went too far.

Jenkin’s email tips evoked wrath on Reddit and probably didn’t make local employees too happy. It included the following tips for saving money.

  • Shop your pantry
  • Do your laundry at night
  • Use your air conditioning instead of rolling down the windows in your car.
  • Do home meal prep
  • Choose store brands instead of name brands

Sure, these are great tips but coming from a CEO that probably earns over $600,000 a year (industry average and what a previous Howard University Hospital CEO earned), these undoubtedly went over like a lead balloon. It’s not that the tips are bad ones; it’s just that they are bland, generic, and not something a CEO should suggest. 

I reached out to Howard University Hospital via phone and email on Monday, but they have not gotten back to me. If they do, I will update at that point.

If your employees struggle with the cost of everything, telling them to search their cabinets for canned peaches won’t help. Here’s what you should do:

When you can’t offer a raise.

Many businesses operate at close margins, and many founders don’t take salaries themselves when times are lean. Sometimes there is no money for raises. To increase someone’s salary, you’ll have to reduce someone else’s. So be honest with your employees. 

Don’t keep finances secret. If you don’t have the money, you don’t have it. Yes, you may have people quit, and you’ll struggle to replace them if you can’t pay the market rate, but people are much more accepting when they know the truth.

Now, telling people that you don’t have the cash does not work well when you give executives big bonuses. That will destroy trust.

When you have the money, everyone is earning market-rate salaries.

This happens as well–and you want money for reinvesting in the business, providing bonuses, or putting it in your own pocket. You don’t have to say yes to every raise request, and you don’t have to feel guilty about it.

Counter with you’ve looked at the salaries, and they are at market rate, communicate that. Show employees the data. If you don’t feel comfortable doing that, you’re probably not paying people at their correct market rates.

You can also feel free to pay people at above market rate salaries. This can go a long way toward employee retention. Remember turnover is expensive–it’s often cheaper to pay people a bit more and keep them longer. 

Whatever you do, don’t be condescending.

This email didn’t give helpful and unique information, and the air conditioning information is disputed at best; it would have been better for Jenkins to keep her fingers still after she gave information about the hospital itself.

I’m sure she thought it was helpful information. I’m pretty sure most people did not.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.