I have always been on the other side… employee until today i became an employer.
I have vowed that if i become an employer i will treat my employees good.
So we just bought a small business with great staff and we kept them. During the business purchase it is to everyone's understanding that they will remain employed. They were paid $17/hr in a small gift shop (1700sq ft store) so today as our first official new owner, we thought we would give them a raise to start until we really know how the business works and get to know them. We have plans of increasing their pay to $18-$19 in th next 6 months. And giving them more sick days. All are part time employees and the min pay in California is $14 for businesses with less than 25 employees.
Here's the biggest shocker!! It's our first day as owners , we communicated with the staff that our priority is for them to be happy and to take care of them . As we are telling them that we will start them at $17.50 for now reevaluate next year until at least we know their worth. 2 of the 3 came back individually and said that they know their value and worth, that they are at least $23/hr .WE WERE SHOCKED! That is a 35% increase and the previous owner just had a $65k profit without taking salary. The small business cant afford it, specially we just bought it, plus we have not seen how they work thought we were assured they are great asset. But what good is it if the business cant afford to keep them and there is no profit bottomline.
I think it is a stretch to ask for that pay increase from us (new owners) and they didn't from the previous owner. I wanted to be nice but how can we have a healthy business if its all going to wages.
Any advice? Im really sad and concerned specially on the first day of business and they have not even given us a chance.
What do you think? They are valuable to the business but keeping them might mean we will not have any profit.
I am so disappointed ! We had plans to be good employers.