OK, is she your only member of staff, how much do you value her (has she been a good employer etc), can you afford the £84? Art is perfectly correct, you do run the risk of staff thinking they can dictate to you, but its a toss-up really, isnt it, between seeing her point and making the job seem as attractive as the next job that she may already be applying for, and making sure that the lunatics dont take over the asylum (forgive the expression). Although 7 months is not a long period of time, it is more than long enough for someone who is going to cause you trouble to show her true colours. I am assuming from what you say that she's never caused you a problem so far?