As others have suggested, I would invite her to another discussion, where you focus first on learning the underlying motivations behind her request for a raise. Listen to understand, not to reply. Use open-ended questions: "What is important to you about a raise right now?" "Tell me more about that." Her responses may go beyond "more money" and will, I suspect, get at some of her values. She may be seeking: recognition of her hard work, assurance that she being treated fairly, financial stability for herself and her family, knowledge that the employer is invested in her, and so on. Once you know what's important to her, begin to brainstorm off of those values, taking each one in turn. Frame the issue as "how can we work together to...?" There may be options that go beyond a raise, for example: a title change, increased responsibility or participation on certain projects, investing in training opportunities for her, a change in her benefit package, etc. that would meet her needs. Good luck!

I would start by researching her position on salary.com and see if she is currently being paid fairly. If she's not, you don't have to bother asking her why she's asking for a raise. If she is, I'd evaluate whether she's taken on more duties and responsibilities since she started. Is she making close to what her coworkers are making or is she substantially paid less? Sometimes people accept a lower salary just to get hired and realize they'll never get to where they want to be with COLA raises. In the back of my mind, I know I'm probably either going to have to move to another position or another company to make the money I would like to be and should be making with my degrees.

Yeah, maybe she will quit -- but as many have mentioned, maybe she should! I'd reassess whether those COLA raises are the right move for your employees, too. And, has this year seen her doing a lot more work for no more pay? Because that was once me -- around the 07-08 recession, the company I then worked for froze raises and hiring, and then asked me to maintain my own responsibilities plus half of a co-worker's while she was on a year of medical leave, so I worked 5 days one week, 7 days every other. Three months into that, I sat down with my managers and asked for a very substantial raise to reflect the job-and-a-half I was doing, regardless of the freeze. They said no. I left, and I maintain that was the right thing to do.

You have said that the case she presented doesn't reflect the realities of HR - That can mean a few things. I would suggest that whether you go to bat to get her more money depends on whether you think she is worth it. That will include a lot of factors, many already mentioned, like pay-to-market, any recent changes in scope to her job, etc. I suspect the additional 50% may not be her true end goal. At the end of the day, you should be paying her what she is worth. If you feel you're already doing that, then you should tell her so. If you don't, you should make the attempt to correct it.

I'm with Deborah and Leigh. I'd find out what's behind the request, to start. Has she been recruited by another company, and is her request for a raise because she'd really like to stay with you, but she's been offered a salary increase elsewhere? This is important data for you to uncover. Additionally, where you may perceive yourself/the company to be "in control," actually, if she has data that shows that she is being underpaid, after having done a market assessment/scan, she's in control. Data doesn't lie. If she's being underpaid and can go elsewhere (and may already have another position), she's right to ask for a raise that permits her to work at the rate she deserves. Do you have a salary structure/banding that anchors raises in a compensation philosophy? If you do, and you cannot give her this raise, it will be clear. But she's asking because she's negotiating with you. So it seems to me that it's clear to her you do not. You may also want to consider this as a signal that a compensation philosophy, or steps toward it, is a good place to start.

Former HR Director, here. You should request that your HR partner or compensation team review her pay to market. In companies where COLA is practiced without regard to performance, high-performing, long-term employees suffer, in my experience. Over time, they become underpaid to the local market as COLA usually lags behind and all it takes is one cold call from a recruiter to start the process of leaving or planting a seed of bitterness that the company doesn't value him or her. Do not be shy about providing your input to HR because squeaky wheels get the grease, and while they will likely tell you there's nothing they can do for you, a strong outline of the cost of losing this employee and the difficult gaps that would be left behind can make brick walls suddenly fall away.

If you do this, what will other people on the team think? They might want the same pay. If her responsibilities haven' changed and she isn't contributing any more than anyone else does she really deserve this? More money always equals more responsibility. Do you think she deserve this? will she produce or is this a way to say? I have an offer for this much if you cannot match it I'm leaving?

I would add that she may simply be negotiating. Negotiating can be a dance. If she deserves more because her role & performance warrant it, then research a raise and see what you can do. We all know (she does too) that she will not get 50% but she might get 10%. If she's worth it and a high performer, it would be worth trying to keep her. The hiring and training costs are expensive if you need to hire a replacement. Most of us (women) are uncomfortable with the male philosophy of negotiating but men ask for more and typically get more. I think that's what she's doing. She probably over did it with 50% but I'd continue the conversation. Good luck!