First, what is your employee really after? Raise, title bump, or both? If a title bump is included, then the question becomes--is that what the company wants?

First, what is your employee really after? Raise, title bump, or both? If a title bump is included, then the question becomes--is that what the company wants? If he becomes a manager, will one of his team want to be team lead? If a director, a manager? Second, the line between a Sr. SysAdmin and a manager is a fine one. Often, it's the size and bureaucratic-leanings of the company which determine which side of the line one falls. In the case of your "employee", much of what he does lines up with the duties/responsibilities of a SAGE Level 4 systems administrator ( http://static.sage.org/pubs/8_jobs/chapter1.pdf http://static.sage.org/pubs/8_jobs/chapter1.pdf ). But, it also lines up with what one would typically think of a manager's responsibilities. Once again, company dependent. Third, you never told us his current salary or range thereof. Maybe he is in a competitive range already. The last SAGE salary survey is from 2007--a bit dated with all the economy has been through. But in 2007, the national average for a Level 4 sysadmin was around $90K. ( https://www.usenix.org/survey/2007-sage-salary-survey-results https://www.usenix.org/survey/2007-sage-salary-survey-result... ) Other places you could look for salary ranges are http://www.payscale.com/ http://www.payscale.com/ and http://www.glassdoor.com/ http://www.glassdoor.com/. I plugged some data at random (12 years experience, Columbus, OH, $80K/yr salary, etc) on PayScale. For a Sr. SysAdmin, $80K is at the 62nd percentile; $75K is average. For a Network Ops Manager, $80K is right on the average for that area. Of course, you could also speak with your HR department to have them pull local salary surveys. But what it REALLY comes down to is this. He's done some comparison shopping. Based upon what he's found, believes he's not being fairly compensated for what he does. He likes the company, likes his co-workers, etc, and is giving you guys the first shot at "making things right" in his mind. From your standpoint, he's highly competent and a good cultural fit. Those are people you don't want to loose, and are the ones who hit the upper ends of the pay scale.