An acting allowance is when you temporarily step into a higher position and substantially take on the duties and accountability of that role.
Example: Your manager resigns. While the company looks for a replacement, you are asked to act as the manager.
You are not promoted yet. Your substantive position remains the same.
But because you are temporarily doing the bigger job, the company pays you an acting allowance.
Meanwhile, stretch allowance is slightly different.
You remain in your existing position, but the company temporarily gives you significantly more responsibilities or a wider scope.
Example: Covering another colleague during her maternity leave or taking care of another market. There isn’t necessarily a vacant higher position that you’re acting in.
In the past, my practice was to give RM1,000 to RM2,000 for acting allowance and RM300 to RM600 for stretch allowance, depending heavily on the workload and additional responsibilities.
I know allowance are additional costs, and especially for smaller businesses every additional cost matters.
But when an employee is genuinely carrying significantly more responsibility, a small allowance may be a small cost to the company, but it can a meaningful acknowledgement to the employee.
Feeling fairly treated can be worth a lot.
Think about it.
xoxoxo, AuntyHR
