The worst situation: wait until the team member has received
their salary slip and then comes to complain. It is more respectful to
anticipate the deception and tell the person about the
decision during a private meeting.
The need to anticipate would be the same in any other situation
where deception is possible: promotion not given, new organization …
Spell out the decision rapidly and clearly
When a decision is difficult to announce we have a tendency to
beat about the bush and take verbal precautions which only annoy the
listener and help them prepare. It is better to spell out
the key message in a few words.
Give your reasons in the second phase
Another mistake in this sort of situation: justifying before the
other person has received and digested the message. Not only is this
useless (the person is surprised and disappointed, they
don't hear) but it is dangerous for the relationship: the team
member can think you are trying to confuse the issue. It would be better
to wait until they are ready before explaining the
reasons.