It’s a common problem, especially right now. And it sucks.

So, what’s your goal in this situation? As a manager or leader, your goal is to keep that person working for you.

You need to have a conversation. I know these chats can be tricky, but they’re not something you want to delay.

The first thing I do is check where they sit compared to market rates.

This step is essential. They might not be far off, or they could even be above market. If that’s the case, the conversation becomes more about setting expectations.

Next, I look at what needs to be true for them to get a pay rise.

This could be tied to the company hitting sales targets, launching a product, or raising capital. Helping them understand the financial realities of the business is important. If you’re a middle manager and don’t have access to that kind of information, talk to your HR person, your manager, or your CEO. You need the full picture.

Then there’s the opportunity to think a bit differently.

I always say there are no rules in business, just laws you have to follow.

Could they get an extra week of annual leave? Could they drop from 40 to 36 hours a week without a pay cut? That’s essentially a pay rise, without changing the dollar amount.

I’ve done this many times in my career. Hiring someone for four days a week to make the budget work. What I’ve found is that someone working 36 hours is often just as effective, if not more so, than someone working 40. There is a lot of dead time in a typical week. Less time often means more focus.

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Jonathan Morgan is the Co-Founder & CTO of LiveRem. You can read more about him here or connect with him on LinkedIn.