How To Promote Employees (With Tips)

By Indeed Editorial Team

February 22, 2021

Promoting employees shows employees you value them while also setting up the company for future success. Selecting the best employees for promotions requires careful thought, consideration and planning. In this article, we discuss the importance of promotions, the different methods of promoting employees and when and how to promote employees.

Why it's important to promote employees

Promoting employees benefits both the company and employees. Employees receive recognition for their hard work, and companies often strengthen the quality and abilities of their staff. Here are some benefits of promoting employees:

Increase employee retention

Promotions give your best employees a reason to stay with you. By recognizing their talent and providing them with a new challenge, they may be content and uninterested in exploring other employment opportunities. Also, a promotion may make them more loyal to your company, which also decreases the likelihood they will leave.

Related: 20 Strategies for Employee Retention

Make employees feel valued

Promoting an employee shows you see and appreciate their hard work. This may help them care about their work more, and it validates their efforts in the workplace. The promotion may encourage them to continue to pursue their career goals.

Improve workplace performance and motivation

While employees often receive promotions because of their excellent workplace performance, a promotion may improve their performance even more. By recognizing and rewarding their hard work, you motivate them to continue to do a good job. Their commitment to good work contributes to the success of the company.

Create healthy competition

Promotions may create some competition in the workplace, as multiple people may want a single promotion. This competition may motivate employees to work hard and deliver the best possible results. Friendly competition can push employees to grow, and the company benefits from the improved work performances.

Develop leaders

Identifying leadership qualities in employees is important in the promotion process. When an employee earns a promotion based on their work performance, current leaders likely also see leadership potential within that employee. This allows managers to help employees better develop their leadership skills, setting both the employee and leader up for future success.

Improve morale

Employees may be more engaged and happy in the workplace when they feel valued. Promotions often also include higher pay, providing employees with better rewards for their hard work. Also, if an employee knows they are doing their job well, they may be happier with their performance and push themselves to work harder.

Related: How to Improve Employee Morale and Job Satisfaction

When to promote employees

The right time to promote an employee varies for each position an employee. Some positions may require certain skills, but other positions may require a longer tenure with your company. Here are some things to consider when you decide to promote an employee:

  • Skills and abilities

  • Work performance

  • Education qualifications

  • Technical certifications or qualifications

  • Seniority

  • Leadership potential

  • Time since last promotion

  • Level of training

An employee's level within the workplace may also affect when to promote them. Here are some signs to look for when you consider promoting a lower-level employee:

  • They're committed to their work

  • They do more than what their job requires

  • Their work and performance exceeds expectations

  • They help others

  • They adapt to changes

  • They mastered their craft or technical skills

Here are some signs it may be time to promote a management-level employee:

  • They volunteer or ask for more responsibilities

  • They take ownership of tasks

  • They manage themselves and require little to no supervision

  • They view their success as the company's success

Employee promotion methods

There are several methods to use for promoting employees. You may choose a single method or combine multiple, and some methods may better suit certain positions. Here are some common methods for promoting employees:

Competitive methods

Competitive promotions consider employee performance. This method requires employees to prove their abilities and potential and involves comparing employees' work ethics. If you choose this method, consider the employee's skills, qualifications, productivity and past performance on the job.

Here are some types of competitive methods for promoting employees:

  • Merit-based: An employee earns their promotion solely because of their performance, skills, qualifications and work ethic

  • Seniority and merit-based: An employee earns their promotion because of a combination of their work performance and qualifications with their seniority level within the company

Non-competitive methods

Non-competitive promotions occur as a natural step in an employee's career journey. Employees earn these promotions once they satisfy established standards or reach certain achievements within their career. With this method, every employee has the same opportunities and career growth, removing the potential for bias.

Here are some types of non-competitive methods for promoting employees:

  • Accretion of duties: An employee earns their promotion because of an increase in their workload

  • Seniority or time scale: An employee earns their promotion based on the number of years they've worked at your company or in a certain position within the company

  • Ad hocism: An employee earns their promotion to meet a specific or unexpected need, often during an emergency or major period of change

Other methods

There are additional methods of employee promotion that slightly differ from the standard competitive and non-competitive methods. Here are a few examples of other methods of promoting employees:

  • Dry promotion: An employee earns a promotion with a higher title or rank but does not receive a salary increase

  • Up-gradation promotion: An employee earns an increase in pay but does not have any changes in their job responsibilities

  • Out promotion: An employee seeks employment at a different company with a higher salary, often for the same job level or responsibilities

  • Paper promotion: An employee earns their promotion based on seniority and receives their promotion from a parent department different from their own, making these promotions most common within government jobs

  • Open promotion: Any employee within a company is eligible for a certain promotion

  • Closed promotion: Only employees within a certain department or team are eligible for a certain promotion

How to promote employees

Here are some steps for how to promote employees:

1. Evaluate your current staff

It's important for you to have a good understanding of the strengths, abilities and goals of your current employees. Talk to employees often about if they are content with their current position or if they believe they're ready to advance to a new position with more responsibilities. Having monthly, quarterly or annual reviews builds rapport and provides you with better insight to your employees' goals.

If you already conduct regular performance reviews or check-in meetings, you may already know who is interested in pursuing a promotion. Review previous employee review records, especially any records related to setting goals, to confirm their potential interest in a promotion. Also, think about employees who you believe have the skills the position requires but who may doubt their own qualifications.

Related: How to Conduct an Employee Performance Review (With Template and Examples)

2. Determine your promotion method

Evaluate the job position itself, and identify which promotion method best fits the situation. For example, if you need to fill a management position, this will probably be a merit-based competitive process. However, if you are restructuring a department with different titles and adjustments in responsibilities without increases in pay, this may be a dry promotion.

3. Establish the requirements for promotion

Determine clear criteria for who is eligible to apply for the promotion. This may include a minimum number of years working with the company, accomplishments, skills and experience, certifications and qualifications. Make sure all employees clearly understand the requirements of who is eligible to reaffirm your choice for who ultimately receives the promotions is a subjective decision.

4. Announce the promotion opportunity

Post the job, and alert employees of the opportunity. Many companies choose to post positions internally before seeking external candidates. This is imperative if your company advocates for promoting from within first.

Read more: How to Write a Great Job Post

5. Evaluate and interview candidates

Review all candidates to identify the most qualified candidates. Ensure each candidate meets the minimum requirements for the position. It's important every qualified candidate receives a fair assessment to avoid the impression of discrimination or favoritism. Interview the eligible candidates.

If internal candidates do not meet the minimum requirements, it's beneficial to still have a conversation with them. Be honest about why they did not move forward, but encourage them to continue to pursue opportunities. Ask them about their career goals, and give them advice on the potential best next steps for their career.

6. Make and announce your decision

Once you decide who you will promote, make them an offer in private. Allow them adequate time to make their decision, and request they avoid discussing it with anyone at the company. Once they accept, discuss the promotion with the internal candidates you didn't select. Acknowledge their hard work and qualifications, and provide constructive feedback about areas of improvement.

After you discuss the promotion with all internal candidates, share the news with the rest of the company. The best channel depends on your company culture, but it's most often an email or letter. Reinforce how many qualified applicants you had in your messaging to be mindful of the other internal candidates and maintain a positive atmosphere.

Read more: How to Announce an Employee Promotion

Tips for promoting employees

Here are some tips to consider as you promote employees:

Consider employee expectations

Employees within your company may expect a promotion after a certain length of time working there. These promotions may vary in type and frequency. For example, employees may expect being given additional responsibilities often, but they may only expect a pay increase occasionally.

Employee expectations vary across generations, and they also vary for each person. A younger employee may be more eager and expectant of a promotion, whereas an older employee may be content with their position. Talk to employees about their goals and hopes to help manage their expectations about potential growth within your company.

Be honest with employees

If any employee approaches you with questions about their candidacy for a promotion, be honest with them. If they are qualified, encourage them to apply. However, if they may not have the skills the position requires, encourage them to focus on improving their skills. Help set them up for success so they may be better qualified the next time a promotion is available.

Communicate effectively with employees

Ensure everyone receives the same communication regarding internal promotions. Notify each employee in the same method at the same time. This is the most fair approach, as everyone has the same information about the position, and no one learns about the promotion sooner to have more time to prepare. This is essential to avoid any false idea of favoritism or discrimination.

Understand your employees' goals

Get to know your employees through consistent performance reviews. These reviews may also include goal-setting activities, and they provide you with more information about the long-term goals an employee has. Try to have a good understanding of which of your employees want to further their career path versus those who are happy with their current position.

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