How to Say No to Raises Without Losing Your Team

Every time a team member asks for a raise, the pressure is instant — but it doesn’t have to be. In this episode, find out how to talk money with your team, set clear expectations, and lead raise conversations without it getting awkward. We explore inflation, bonuses, and systems that give your team a clear path for growth without blowing up your payroll. Listen now to take the stress out of every raise decision!

Topics discussed:

• The trap of throwing money at problems
• Mistakes owners make when asked for a raise
• Henry's dental assistant ladder and pay scale
• How to avoid losing team members when you say “no”
• How bonuses impact pay decisions
• How to handle the inflation and market pay argument
• How to stay competitive and keep team members happy

This episode was produced by Podcast Boutique https://www.podcastboutique.com

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Chapters

• 0:00 The Money-As-Fix Trap
• 3:01 Costly Raises And Team Fallout
• 5:24 Value Over Time: Skill Ladders
• 7:59 Courses Don’t Fix What You Don’t Implement
• 10:34 Titles Without Duties Backfire
• 12:59 Find And Communicate Market Pay
• 17:43 Deflecting Raise Requests With Respect
• 20:23 Proactive Money Talks And Career Paths
• 23:23 Inflation, Bonuses, And Benchmarking
• 25:53 Competitive Pay Without Overpaying
• 27:13 Coaching Offer And Closing

Transcript

Paul Etchison: 0:56

Let's be honest. There are moments in ownership where money feels like the fastest way out. A team member, they might be unhappy. Give them a raise. The systems are super messy. More raises and people just aren't performing the way that they should. Well, maybe we should pay them more with more and more raises. But what if that quick fix is actually training your practice to stay broken and be much more expensive? That's what we're going to be talking about today. How can we as practice owners resist the urge to throw money at problems and instead fix them without increasing our payroll? We dive into why money isn't the fix we think it is, how to reward value instead of time served, and why handing out titles can be just as dangerous as handing out raises in the simple systems that keep you fair, competitive, and still in control. Now you're listening to the Dental Practice Heroes podcast, where we help dentists work fewer clinical days, increase profits, and build team-driven practices that run without you being the bottleneck. I'm your host, Dr. Paul Etcherson, author of two books on dental practice management, dental coach, and the owner of a large group practice in the south suburbs of Chicago. And today I am joined by my DPH coaches who live what we teach at a very high level. The first is Dr. Henry Ernst, the owner of an 18-out practice in the Carolinas, only practicing two days a week, and also Dr. Steve Markowitz, the owner of six practices in the Boston area, only practicing just one day each week. All right, let's jump in. We got a good topic today. We're talking about something we're all guilty of. I'm guilty of. I feel like I've done this recently. And we were just discussing, we're like, what is going to be helpful for our listeners today? And we see it in a lot of coaching clients is we tend to throw money at problems. We see issues and we wonder if a raise is going to fix this for us. If I could only throw more money at this, this would fix it. Surely my problem is I'm not paying enough. That must be the solution. Steve, going to you. Any you ever been guilty of this?

SPEAKER_01: 3:02

Very much so. As we were trying to think of topics, I got slapped in the face with the first time I was ever asked for a raise was from one of one of the members of our team who was probably liked the least and would always find a way to bring things down. I didn't know. She came, she asked me for a raise, and I didn't just give her a small raise, I gave her a pretty significant raise, like a 15% raise or something like that. And I thought she came, she's like, Well, it's been, you know, I just bought the practice. It's been a a year or two since I last got a raise. And I was like, okay, and what kind of stuff are you doing? She's like, I run the clinic floor. Okay, wow. Here's an extra three dollars. And then all of a sudden I got to work the next day, and everyone was in line, upset at me. And I was so confused, and I thought I was doing a good thing, and ended up this team member, the first raise, and also the first person I let go, all within the same month because of just me not knowing and trying to have money be the solution to my problems.

Paul Etchison: 4:11

Was it weird that everybody knew about it? Like, I know like there's no laws, like some people like want to fire people over talking about their salaries. And I think you got to check your state laws. In my state, you cannot. It is like you cannot tell people they can't talk about their salaries, but it's still kind of a faux pas. Like, don't do it. Were you surprised that?

SPEAKER_01: 4:28

Yeah, at the time I wasn't surprised about anything. I have learned that I can't control what people say, and I can't be in the business of that. But what I can make sure is I fully understand the situation before I start rewarding people. And I think that I hope that's what we get into today is how do we reward things that we want to encourage and not reward things for things that don't align with what we're trying to do.

Paul Etchison: 4:57

Yeah, I like that. That's a great way of framing it. I feel like when I've had these conversations where people have asked me for a raise, and this is me, now my leads do it. I don't handle these conversations anymore. I mean, I do them with specifically with my leads, but I don't like the sometimes I feel like I'm saying, like, hey, I can give you this raise. And like deep down, I'm like, it's not enough. It's not enough. Like, I've got this like deep down shame, like, there's no way they're gonna take this, they're gonna be pissed. This is a slap in the face. And I can't think of any times where that's actually happened, where they've actually interpreted it that way. But like deep down in my heart, I think of I feel like that. But like then I know like the payroll. If I give a three dollar raise to everybody on the team, like it doesn't work. Like, there's just not the money. Henry, you're you're sitting over there. What are you thinking, man?

SPEAKER_02: 5:38

Well, I know thinking about where we just rather throw money at problems. There's a couple things that come to my mind, but jumping on Steve's bandwagon about the raise issue, I think it's super, super important to establish your office and not get into the mentality of letting your staff to think, well, the passage of time has occurred and so I need another race. Passage of time, raise. It shouldn't be like that. If somebody comes to you for raise, it should be what's the value? What's the value that you're giving me since the last time you had a race? So if I'm a DA1 and we train DA1s to become DA twos in our office. Well, talk about what that is for listeners that don't know what that means. So in our office, an entry-level dental assistant starts as a hygiene assistant. So we have a certain level of skills that you should be able to master. Taking x-rays, talking to the patients, collecting medical histories, placing sealants, placing desensitizer, all these things you should become a master of. And then at some point, maybe they've been with us for a while, then we start to graduate to the doctor side. And we don't call them a DA2 right away. They have to learn certain skills that are DA 1.5, suctioning with the doctor, you know, doing all this stuff that's not by yourself. DA2 is by yourself. So not getting too much into that, but when assistants start to come over to that sign, then maybe they would value a raise because somebody would come up to me and say, Hey, I haven't had a raise in a while. Well, let's see, what skills do you do now that you didn't do before? And if they don't have any, then I will direct them to a skills list. Why don't you learn these skills and then come back to me when that happens? Same thing goes for admin. Learn these skills and then come back to me. At least now you're establishing some sort of value-based reward system instead of just passage of time. And I wanted to jump on board with the other thing, just taking this, throwing money at problems. This came at our mastermind meeting we had last weekend, which was great, Paul, by the way, and Destin. It was beautiful. Great time. One of the doctors, and this this is pretty common, was talking about all these problems that they're having in their practice. And oh, we had scheduling problems. So we went to this course. And after the weekend came, it didn't get fixed. And then my assistants don't do this, and we went to this course, it didn't get fixed. Well, I kept asking this doctor, I said, Well, what did you do afterwards? You can't just go to a course and spend a lot of money and inspect this magical course to fix it. You have to take action and you have to have steps and you have to audit those steps. So I think that's a common mistake that doctors make is they just think that some magical course that they see in a dental magazine is going to fix all their problems. When you still have to be a leader in the practice, you still have to be a visionary and have all the steps to implement what you learned.

Paul Etchison: 8:13

Yeah, I remember when this person was bringing this up, we do the hot seats at the mastermind event, which is essentially where you sit there, you tell everybody about your issue, you give all the information, and then everybody in the mastermind, there were 13 of us this weekend, and we all went around the table and we all gave advice. And this person got a lot of good advice about kind of one thing just Henry just said. But then also, like, I remember what came up too was we need to lead the team. Somebody's got to lead. And I know it sounds a little cliche, but what I mean is we've got, hey guys, this is where we're going, this is what we're doing. And then it has to be, I need to check in on this over and over again. I can't just revisit this one month from now. You know, I talk to a lot of coaching clients and they say, Will you talk to my team? Are you going to be working with my team? And I always tell them, I'm happy to work with your team to some extent, but I need to teach you how to do it. Like, if I can't teach you how to do it, it doesn't stick. Like, I can't make your team behave a certain way. So just coming back to what Henry said, I think the DA1, DA2 thing is great. As far as I'm concerned, with I've seen like this pay scale that you have, Henry. And like for my team, most people would be at the top of that within 90 days. You know, whereas like I don't feel like they're fully experienced at 90 days. They could say they do the skills, but they've got extra skills that they've already, you know, just from being there, they know how we do things, like those little things that come up. I think it works fantastic for an admin position. I think that is a great pay skill. But what comes to mind for me is there's been times in my, I remember one employee came to me, wanted a raise, and I really didn't want to give it. But then it was like, okay, well, if I'm gonna give this to you, this is what's going to happen. This is what I need you to do, which I think is a step in the right direction. But what I really wish, I remember giving this to this person. I'm sitting there, they're asking, I've said, okay, do you think you could do this? She says, Yeah, I could do that. I could do that. Okay, cool. All right, I will give you this raise if you start taking over this thing. So she took it over. And wouldn't you know, three, four months later, fizzles out, didn't do it. And I kind of wish I would have once said, Hey, I will give you the raise once you take this responsibility. And that would have been a better way of doing it, and it would have stuck better. What do you think, Steve?

SPEAKER_01: 10:19

The only place where you think you guys are are throwing money at problems is people.

SPEAKER_02: 10:23

That's all I can think of. I'll throw this another way. Another thing we caught and it's fresh in our minds from the mastermind meeting. Another mistake that's tied into the money is doctors will make the mistake when somebody comes to them for a raise, is not only maybe throwing a little money, but also throwing a title out there. So, a good example is a doctor who has a great billing person, steadfast, they do all the billing, their collections are 100%, doesn't have to worry about anything. And all of a sudden, this person comes to a raise, and what does the doctor do? The doctor says, Oh, okay, I'll give you a raise, and your practice manager. And this person does not have the title of practice manager of it's stolen valor, basically, because she's not a practice manager. She's basically a glorified biller. Now this doctor has this person at such a high pay scale that what do you do from there? So not only there's the money but the title Tell the stolen valor analogy you told over the mastermind weekend.

Paul Etchison: 11:14

I really liked it with the airplane.

SPEAKER_02: 11:15

Well, it's basically we we all go to the airport and we all see people that go to group one, group two, and you know, we always see the military gets first privy to go first, which they should. They deserve it. And so, gosh, there's people in this society now that will wear like a fake military uniform just to go into the airplane first, and that that's completely stolen valor. They didn't earn it, they didn't deserve it. You know, the military should be held in high regard. So, I mean, this is a small example, but this doctor just got nervous and threw the practice manager title out at them.

Paul Etchison: 11:44

Yeah, and then it's oh wow, I have an office manager. Wow, cool. I'm I'm leveling up. No, not at all. You gotta give them what to do. Now, Steve, I feel like this sense that you're wanting to take this episode down a hole and you want to dig us in. And we I want to come with you. Take me, Steve. Go, baby.

SPEAKER_01: 12:01

I don't know how how deep I want to go. Deeper. I'm just trying to explore different ways that I've thrown money at problems, which sometimes it's was intentional and sometimes it's just was like the path of least resistance. So that's typically where I go. What I had written down was we need to take time to understand what market value is for each position. And if a job in our area pays 25 and we're paying 21 and someone wants a raise, we need to give them a big raise or we're gonna lose our whole team because we're under market value. So just because someone is asking for a raise doesn't mean that they're wrong. We need to get more data to understand, and then we can throw money at real problems. That's what we should be doing. We should be throwing money at real problems, and then we should use the money, which is a way for us to fix these things, but we need to understand actually what we're fixing. Is it if it's just to like appease someone, then or give them a title so it it gets off our plate, and then we can move on to the next thing and not think about it for right now. We don't have a strong enough system to have consistent practice growth.

Paul Etchison: 13:09

I think it's great that you mentioned the pathway of least resistance because I think that's what we're doing when we're throwing money at a lot of these raise requests. We're buying ourselves a quick way out of this conversation that we don't want to have. There is so much merit in how to understand the market value of each position. Someone told me once early in my practice management career that a person is only as valuable as their replacement. And that sounds really crappy. I mean, that doesn't really resonate with the DPH attitude of what we're supposed to treat our teams like, but to some extent, it's true. You reach a point where it's like good luck finding this somewhere else. You've got it pretty good here. I think you need to appreciate what you have. How do we even like know what the market value is? If someone's saying that I have no idea what people are getting paid, I'm so I'm on my little island here. Perfect. Can I answer that?

SPEAKER_01: 13:53

Yeah. The first thing you do is just go look for jobs. Go on Indeed, go on Craigslist, go look at what's on the Facebook groups. If your people are paid at a certain level, and then you go on there and the market is saying three dollars less for that same position, then perfect. Your job is not to overpay everyone, your job is to make sure they are well compensated for the value they're creating for your practice. And most times you have to communicate that. People don't leave jobs for a dollar, they just don't. They leave for feeling underappreciated, they leave for feeling like making an impact. And if we're not able to communicate with our team, they're gonna ask for more and they should have every right. And then it's our responsibility as the leader, as the owner of their practice, to educate them on what the marketplace is because they don't know. All they hear is that their friend down the street is making$90 an hour for two hours at work or whatever it is. So it's our job to educate them. She's temping. Yeah, she's whatever. And then it's our job to make sure that they feel cared for in our that's what we talk about here. It's like, how do we make sure people truly feel cared for and understand the value that they're creating? And then if if we're still on a line and we love this person, we think they're a good values fit and they need more, let's create a path with them, not just give them.

Paul Etchison: 16:35

You know, I'm gonna give a hack for all the listeners here. If you go on Indeed and you look at some job posting for positions in your area and they give a range, the actual pay is the bottom of the range. It is not the top of the range. They're not giving out the top of the range. It's the bottom. That's the number. Don't get confused by the range. Henry, like, what are your thoughts on? We're giving the listeners some idea of like how to figure out what people are worth and value-wise, and we're looking monetarily. But what is the proper way to deflect and have this really uncomfortable conversation? Because I think it's we we get backed into the corner when we don't know it, we get surprised with it, we're not prepared for it. And then we would they walk out of the room and we just give out this huge rage and we just go, damn it, why'd I do that? Man, I hope nobody else finds out about that. I'm gonna have to give everybody a raise. Like, what is the right way to like handle this conversation so it's like respectful and you don't make that person feel unappreciated, but at the same time you protect the rights and the well not protect the rights, but protect the interests of the business.

SPEAKER_02: 17:36

I think on the front end, the praxes are very successful in this are the ones that share their numbers. You know, when they have team meetings quarterly meetings, you share your numbers. And Paul, you often say this is hey, you know, the going rate for staff is, you know, 25%. We do 30, because I want my staff to be, I want you guys to be compensated at the highest level. Well, when you share your numbers, I mean, it makes them think like an owner like a little bit, right? That there's a cost involved with everything. And if somebody comes to me, I mean, the first thing is, you know, always be grateful. I'm grateful for everything you do here. Sometimes you can deflect. I like this technique is well, you know what, I'm grateful for everything you do here. You know, let me look into the numbers, let me look into your, your, your history. Let's have a meeting next week. And then you never have it. No, well, in the perfect world, it gives your time. And some of our, I know you are, some of our team members have been here for like eight, 10 years. So it does give you valid time to look over when was the last time they had a pay raise? When was it? And it is valid to say, like, what have you done for me lately? Right? What have you learned since the last time? And I'll say another little technique that works really well. For those of you guys who have bonuses in your office, get credit for your bonuses. Have some sort of system. Our office manager does this where if you get a$120 bonus every week and you make, let's just say easy math,$20 an hour. You didn't make$20 an hour last week when you worked 30 hours. You made, you know, what was that,$24. So get credit for your bonuses if you give them.

Paul Etchison: 19:02

Yeah, that's the reason why with our bonus nowadays, we do a dollar per hour bonus. Because I I hated the idea of like, oh, your bonus is$100, but like that's really, you know, for most people, that's gonna be uh if it's one week, that's$250 an hour for a full-time employee. I think a lot of my payroll woes uh have been situations like this that have gotten me into a pickle because I want to be the nice guy. Steve, how do you handle these? Like, what's your take on what Henry just said? What would your opinion be?

SPEAKER_01: 19:27

I think that communicating with the team assists them to have these types of conversations. So what I feel is if I am waiting for the team member to come to me to ask for a raise, I have failed them. So we try to be proactive in the in those one-on-one conversations to have a sense of where they are feeling appreciated and if they at least once a year have that money conversation as far as are we meeting their expectations. So we try and be as proactive as we possibly can. There are still times where that where we fall and are misaligned with with the team member. We also need to know like, do they want more in their out of their job? There was a woman that worked for my dad that worked for me for my first, she was there for 40 years. When I first was in dental school, my dad was like, I once asked Carol to be the office manager, and she she said she didn't want it. She loved her job. She wanted to be at the front desk, welcoming patients, and that's all she wanted. And she was super happy. And for us, we call that rock stars that they're great at their job, but if you give them more, they're gonna get super uncomfortable. They don't want it. And they know that about themselves. That's so cool. Then you could have that, you know, once a year, once every 18 months conversation about like the market's changing, and here's an extra dollar or whatever it is. And then on the other side, there are people who are really hungry and they want growth and they want more. And superstars, this is from um uh radical candor, this is stolen from radical candor. Those people want growth and they need they need more. We need to make sure that we're understanding what that employee wants for themselves, so that if there's times where we've given out, you know, a dollar raise and the employee was pissed because we didn't know that they were looking for a new position, a new more responsibility. And I think that's why having some kind of proactive system, making sure you're having those conversations, and if you're seeing that people on your team are consistently coming to you asking for raises, you're probably doing it wrong.

Paul Etchison: 21:32

Yeah, you know what one thing I think about when you just mentioned that is that I think in my 13-year career as being a practice owner, I've been asked for a raise maybe less than 10 times. And I don't know what that means. I don't know what to take about that, but I will tell you, like Henry said, I've always been very forthcoming about this is the payroll percentage of collections we're shooting for. This is what I pay you guys because your guys are worth it. And our bonus is based on that. There's so much about that. And there's times where, like, I could tell you recently, I've been asked for a few raises recently, and we've been down. This was our first year that we actually did less than the previous year, where like we're seeing this month where less than last last year. Uh, like, for instance, last October of 2024 was better than October 2025. And it's very easy for me to say, gosh, I appreciate you so much. And I I hope you're happy here. I just don't have it. I just can't do it. I'm so sorry. And it sucks, but at least I'm standing on some evidence. I'm standing on some cultural thing that I've been talking about. I'm curious, you know, we're coming up on time, but I'd love to know like, how do we address the whole man? I get that we're not doing more. I get that I'm not providing more value, but things cost a lot of money now. Look at all the inflation. Steve, what do you say?

SPEAKER_01: 22:48

It just goes back to understanding what the market is. And if we're offering below what market is, we need to fix that. So when we hire a renewal employee, we have a pay scale spreadsheet. It has their first name, their last name, the data hire, their current rate, and their date of their last raise. And at least every six months we go and look at that. And on the second tab of that is salary.com, payscale.com, indeed, Craigslist, and ZipRecruiter of what is offered for those certain positions. And every six months we go back and we look at that and we make sure that we're, I don't want to be the highest in the our area. We cannot overpay for positions, but we better be at the highest point we possibly can. And we share that with the team. I'm not going to overpay. We're not going to pay the same as someone whose wife works in that position, but we're going to make sure that you are very highly compensated compared to other people in our area.

SPEAKER_02: 23:47

I love that. Henry, take us home. So one thing, it's a little tweak here, is when you have your bonus system, for those of you guys who have bonus systems, make sure that it's tied to your ongoing costs. Because as the ongoing costs rise, the bonus level rises. So that makes it not as bothersome when you have to give a raise because you say to yourself, all right, now we're the level that they had to achieve just went up. So I think that's really important because it's going to happen. And another thing, too, is don't let people come at you with something from Indeed that says, hey, look at this ad. It says this much. Or look what I saw on Facebook. Because some of that, like Paul said, is bullshit. So just be careful.

Paul Etchison: 24:24

Yeah, I had somebody come in my office. She sat down and she reached into a bag and she set a stack of papers and she said, I would like to show you the national average for dental assisting in 1970. And I would like to show you inflationary data from the past 50 years and show you how dental assistants are really. And I said, put that away. I said, you gotta talk to your lead. And I was like, my God, get me out of this situation. Why? Yeah, I think that the moral go ahead, Steve.

SPEAKER_01: 24:52

When you were talking about people asking you for raises, I think that the take-home is people don't leave for money. 99% of people don't leave for money. And the reason why you don't get asked is because you're a freaking rock star boss and they love working for you.

Paul Etchison: 25:07

Maybe. I appreciate that.

SPEAKER_01: 25:09

Yeah, this is a feel-good hour with uh Dr. Atchison. But if we have real relationships with our team and we know they love us, that goes, and they're well compensated, they're not going to ask for a race because that's not why they're there.

Paul Etchison: 25:23

Yeah. That's a good point. I think we're looking at we're looking at how to solve the what do we do when people talk about it. And you're right, it's not the right area of solving the problem. I'll just close off on one thing because we're coming up on time. But I I work with a lot of coaching clients and they'll say this to me I need a second hygienist. And but this is what they're maybe they're getting$60 an hour. They're getting$60 an hour in my area, and I don't want to pay that because my existing hygienist is only getting$40. And I don't want to give that one a raise. And the thing is, is like, market rate. Like, aren't you concerned this person's gonna leave too? Like, and I'm not saying you gotta jump this person up to 60, but we've got to be competitive. I think that's the main thing. Be competitive, share your numbers with your team. You don't have to share how much you're taking home, but share what the payroll percentage is and speak from the heart. You know, talk about what it's like to run a business. Man, explain how much you would love to give everybody an extra like$50,000 a year. It's just not reasonable. It's just not possible. It doesn't work like that. And if you're looking at issues in your practice and you're saying, I have a whole mess of issues in my practice, I'd love to have one of these two guys looking at my practice with me on a month to month basis so that I can go next level, create more time off, and have better freedom. Please reach out to us at dentalpracticeheroes.com. Go on there, set up a free strategy call with us. Happy to talk you through what's possible and at the bare minimum, give you some advice on what are some next steps in your practice career. So thank you so much for listening, and we'll talk to you next time.