Any tips for managers in big orgs here? If you have an employee asking for X%, but you are just a lowly first line manager, your chances of getting them that raise would seem to be essentially zero. You go to your manager or your skip and plead your case but you get denied. What do you do next? How do you maintain morale and engagement from the employee?

Logically, the employee needs to decide at this point whether to vote with their feet or suck it up. If the job market is hot they will go and you lose a valuable team member. If it isnt they stay and may feel resentful.