“A Greenhouse Manager earns an average salary of $45,530 per year. Pay for this job does not change much by experience, with the most experienced earning only a bit more than the least.”

Well, that’s encouraging. Even if this limitation doesn’t ring true in your business, it is a reality for many and is a widespread presumption about green industry pay. All I had to do was Google search a question about pay grades for greenhouse growing or management careers to find discouraging statements like that one, pulled directly from Payscale.com.

In my June 2016 feature for Greenhouse Management, “Beyond the Paycheck” (bit.ly/2qWezGL), I wrote about employee attitudes towards income and how you can make employees feel valued using meaningful strategies and tactics not tied directly to cash. Money doesn’t always rank No. 1 amongst employees; there are many other methods you can employ to make staff feel valued and happy in their jobs. Even so, money still matters. Our industry does not have a great reputation when it comes to pay, so if we’re going to thrive in the future, we need to change course. Let’s begin by talking about the cash.

Some businesses commit to a lower base pay, but supplement the employee’s income with cash incentives if certain sales or productivity targets are hit. If you’re a dangle-the-carrot-in-front-of-me person, this compensation strategy can be effective — for a time. But according to some research and plenty of my own management experience, such a cash incentive approach does not always work well or work long-term for everyone; efficacy depends on the context of the incentive and the type of work being performed, as well as the risk-tolerance of an individual employee. There is some evidence that cash incentives can be effective in manufacturing operations where speed (a quantitative factor) is key to the production of a tangible product, which you can successfully translate to some production tasks and employees in a greenhouse operation. However, the same positive, incentive-driven results may not be realized with more qualitative work, such as management, customer service, and sales — at least not long-term.

Offering employee incentives for achieving goals can work, but not over the long haul.
Photo: Laura Watilo Blake

In the September–October 1993 issue of The Harvard Business Review, there was an insightful report called “Why Incentive Plans Cannot Work”. One impactful line from that report read, “Rewards do not create a lasting commitment. They merely, and temporarily, change what we do.” While there can be temporary compliance with some cash incentives, they can backfire on you with key employees over time. Managers, buyers, key sales staff, or creatives in your organization, who may have a significant percentage of their compensation tied to end-of-year profits or seasonal goals, can feel punished if they do not meet goals needed to attain a cash incentive. Or, feel burnt-out over time from chasing the carrot, while working just as hard during tough years as they do in good years. If the total take home pay doesn’t add up over a certain period of time, then the cash incentive is no longer an effective tool and can be damaging to workplace morale and employee retention. A stronger base pay or performance-based salary increase schedule, combined with non-cash perks, can ultimately be a better approach for many employees. A lower base salary with more non-cash benefits or trade-offs, such as schedule flexibility or additional vacation time, may be better for others. If you’re looking to keep an employee long-term, you might even think about changing up their compensation strategy every few years.

While reviewing your pay strategies, it is a good time to look at any pay inequities you may have lurking in your pay structure. Challenge yourself to be glaringly honest here. Look at your starting salaries and pay increases, and ask yourself if you’re adjusting the numbers down for women employees based on certain assumptions. Compensation is a bit of a landmine field for us ladies; women without children are often expected to work extra time without extra compensation even though they may be discriminated against financially because they might have kids in the future. Women with children may be paid or promoted less because it’s assumed they’ll be out of the office more to take care of their families. Men with kids, on the other hand? I was told more than once in my working life that their family status entitled them to higher pay. Eventually, I decided that running my own business was my sole path to a fair paycheck. You might think you’re saving money (or mitigating risk) by paying women less — but ultimately, you’re going to lose productivity and profits — not to mention great employees.

Everyone is different and is motivated by different compensation factors. Some are driven to action by potential incentives; others only by what may be taken away unless they progress. Some need a steady and predictable compensation plan; others can tolerate more fluctuation and risk or be willing to trade cash for flexibility. Some need to shake things up every few years to “reset” their focus.

While a one-size-fits-all approach to compensation may make you feel like you’re avoiding the pitfalls of preferential treatment, it might be setting up some of your employees to fail or leave early. Ultimately, creating a pay strategy that works best for your company long-term may come down to flexibility.