Employees are demanding.

In fact, 73% of HR Professionals believe that employees are becoming more demanding according to research conducted by Capita Resourcing: a trend attributed in part to the growth of Millennials within the workplace.

Studies now show a competitive salary alone isn’t enough to satisfy would-be employees; and with the likes of Airbnb offering staff an annual stipend of $2,000 to travel and stay in an Airbnb location anywhere in the world, or World Wildlife Fund giving employees “Panda Fridays” (that’s every other Friday off to you and me), the requests are getting bigger and bolder. Flexible working, work-life balance, health insurance, cellphones, cars or even house deposit loans…employee demands are on the rise.

But what happens when you need to draw the line and say, “NO”?

Whether the purse strings are tight and you’ve got to turn down that salary increase, or perhaps you’re understaffed and have to reject a vacation, there are times when employee requests simply aren’t in the best interests of your business.

The trouble is, what if the employee in question has stuck their neck out or showed outstanding performance? A brutal refusal of requests can quickly escalate into discontent or even a walk out the door. It is vital to know how to say no without alienating your staff.

Prevention is better than cure

So be clear on the boundaries. If you have clear policies on things like vacation requests, salary reviews and benefits, you can potentially side-step the awkward moment of turning staff down. There will always be one who pushes their luck – but at least the ‘no’ will be less damaging when they know what to expect.

Acknowledge and clarify

Nothing will spark anger more than a knee-jerk refusal that doesn’t appear to have been given any consideration: so listen to the full request, ask questions to obtain all the facts if necessary and feedback your understanding of what they’re asking. If they believe it’s been adequately considered, they’ll be less negative.

Give a legitimate reason

Remember the infuriating days of your parents rebutting your “why?” with that dreaded phrase, “because I said so”? If you’re able to explain the (legitimate) reasoning behind your refusal, you’ll be met with less frustration.

Have a Plan B

If that week doesn’t work for the vacation request, don’t end with a closed “no”: offer an alternative or present a possible solution. None of us like to be told we can’t do something; having options opens up the conversation.

Don’t leave them hanging

It’s natural to be reluctant about turning someone down. But the worst thing you can do is to let them believe there’s hope or to dwell on the request. If it’s got to be a no, communicate it as soon as possible.

Don’t apologize

Controversial? Perhaps. But you are making a business decision – not a personal one. It’s fine to express regret (yes – there is a difference) but steer clear of the sorry card; best case scenario and employees may perceive this as a weak point and push their agenda; worst case, and they’ll believe you are insincere, fuelling their disgruntlement.

Provide feedback and express gratitude

Only where warranted, of course; but if your star employee is pushing for a raise and your hands are tied, there is still opportunity to provide positive feedback to that effect. Employees need to feel appreciated and recognized; enforcing this will help maintain motivation.

Don’t ignore the elephant in the room

If the employee in question is showing signs of being put out, frustrated or angered by your decision, confront it and try to promote an open forum for discussion. Resentment, when left to simmer, can prove poisonous to morale – impacting not only the individual, but those around them. So ask for the feedback and listen. Be polite, but firm. Explain the reasoning. If you can ward off the spread of negativity, you’ll save yourself a headache in the long run.

Saying “no” is a fact of working life. However, when managed correctly, it doesn’t have to translate into a sticking point between employer and employees. By finding ways to communicate and compromise, managers can turn a denied request into an opportunity for development, learning or improved transparency and collaboration with employees.

Sometimes though, no just has to mean “no”.