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Reader A, a CPAA with 12 years of experience, writes with some great questions…
How does one negotiate a good compensation package? I have only ever worked for local firms. The salary data online seems to reflect “big 4” or equivalent pay scales. I have talked to a few headhunters and they all seem to think I should be making more than I am. What do I do when a prospective employer asks point blank what I am making now? I don't want to lowball myself.
This is a particularly apt question in light of this post on the Bucks blog, calling attention to another blog posting wherein the author admitted to “bumping” her current salary up $5,000 when her interviewer asked what she was paid, and then asking for another $5,000 when they offered her the job with a “matched” salary. Long story short: it's illegal to lie about your salary in job interviews! So… don't try that tactic.
Psst: In honor of this series' original title, Tales from the Wallet — here's a wallet we love!
Our recommendation would be twofold. First, let's say that you're at Company X. if you can get TWO job offers from Company Y and Company Z, you can sometimes play them against each other — we would probably avoid naming names, at least unless pressed, and see if company Y will increase your salary to match what company Z is offering. Don't leave Company X out of the mix, either, unless you're looking for a new job because you hate your old one — rather than quitting outright, talk to the Powers that Be at Company X and say, “Company Y has offered me $__ to jump ship!” And see if Company X will match it… and then go forward from there.
A second recommendation would be to really look at what your lower-salary job is actually giving you. Do you get four weeks vacation? How are your health insurance benefits? Are there other perks, like discounts to a local gym, or on-site daycare? We would factor that into the discussion, once the interviewer raises the issue. For example: “I currently make $__ in dollars, but there are a number of perks that I've enjoyed for years and that you don't offer. To be honest, I would probably put a pricetag of $5K on those perks.” Be totally honest — and KNOW what perks the interviewer does and does not offer. In fact, this discussion might be a good time to assess those intangible perks.
This great article from CBS MoneyWatch also suggests classics like asking for a signing bonus, a performance bonus, stock options, or asking for more perks.
Readers, what are your best tips for salary negotiation? Any great victory stories to share?
MLB
It’s not actually illegal to lie about your salary in a job interview; it’s just a really bad idea. If your new employer finds out you lied, you’ve given it a good reason to fire you.
Shayna
In my attempts to figure out how to negotiate, a friend passed this on to me: http://infohost.nmt.edu/~shipman/org/noel.html
Basically, it suggests how to negotiate without including your current salary. I strongly advise against giving a $, because when you do, you may be cutting yourself out of thousands of dollars… Looking forward to everyone elses’s tips!
M
Great link….some really interesting ideas…
Shayna
I found it interesting as well… and it makes sense the the lack of knowledge on both sides can lead to an advantage or disadvantage…
M
Do not offer to tell the prospective employer your current salary. When they ask you what you would like to be paid, return it by stating that you would prefer to answer that after the company has given you a formal offer. Then ask them what their payscale is for that particular position. Also, do market research! Instead of telling them your salary, you can state “based on market research, the average salary for this position is X” when asked what you make currently.
I don’t know how else to get around this dilemma. It’s illegal to lie about your salary, but how do you negotiate a significantly higher salary if you have to disclose your current salary? It’s just not fair.
M
**I actually don’t know if it’s illegal, just going with the Bucks blog and what Kat said. I thought it wasn’t illegal, but I think it is grounds for the employer to fire you after you are hired.
A
Sorry, by “this post” I meant Kat’s post above. I can certainly see it coming back to bite you, being unethical, etc, but I’m loath to take the word of an interested party (HR) for it being illegal.
AIMS
It is not illegal.
It’s speech. Last time I checked, that was (mostly) protected. Who is going to to enforce that? Is HR at the new company going to call the D.A.’s office & report you? Is that a state law? Which state? A federal statute? C’mon, now.
In all likelihood, what it is, is grounds for termination — seeing as how you would technically be untrustowrthy, or whatnot. But show me someone who is charged with fudging something in a job interview, and I will show you someone with a potential Supreme Court date in her future.
Hmmm
I seem to remember an article from within the last 2 years about a lawyer with the DOJ or some government agency who lied on their application and might be facing jail time. But I seem to remember the article saying that he had to certify his application under penalty of perjury because of the agency he was working for.
I did a quick Google search, but could only find this article showing that it is illegal to lie about your degree in Washington. http://www.seattlepi.com/local/261747_diplomamill04.html
Of course, both those examples are different than lying about your salary to a private employer . . . .
jcb
Employers generally can fire you for anything they want anyway. Pretty sure it is not illegal to lie in a job interview, it is just a terrible idea.
Anon
This. Even if it isn’t illegal, and even if you don’t get fired, now you are The Liar. I’d rather be the Girl That Cried Once :)
A
Even setting aside the ethics of it, I would imagine pulling the lie off may be difficult for most people (specially off the cuff).
I guess the moral (heh) of the story is to be prepared–the salary question is probably one of the most difficult ones in any interview, and handling it badly can have a huge effect in your life and career down the line. Learning to dodge and direct the conversation in the direction you want is invaluable.
A
So, the article linked and this post both say it’s illegal, but there’s no source cited other than “a number of HR executives.” Can someone point to a better source on the legality of this? Does it vary by state?
Anon
Where are our employment lawyers when we need them?!?!
Anonymous
I’m an employment lawyer; it’s not illegal — as other posters have observed, it can serve as legitimate grounds to rescind an offer and/or terminate for application falsification.
AIMS
I think this post was going off that article. I really don’t see how this would be illegal, and if it were, I don’t see how that would ever survive court scrutiny.
Agree that it’s a poor idea generally, but I doubt it is illegal.
* one caveat, I did this in college. I applied for a job in a shop on campus and they asked me my previous hourly pay. I only worked at one other place & it went out of business. I lied and said I made $1 more an hour than I did. Granted, professional employ is very different, but I think that was smart on my part (I found out later, they just matched whatever you said so had I gone with $8, not $9, I would have been missing out). And, hey, if that’s illegal . . . come get me, coppers ;)
anonk
I think maybe the “illegal” aspect of it comes from when you sign something verifying that everything you’ve said is true? I could see there being an action for fraud there or something… maybe.
E2
This is what I was thinking too (or in a more classic “job application” setting where you’re writing out an application and signing it), but I am not a lawyer so don’t give this too much weight!
lawDJ
Lying about it on a job application that clearly asks the question might be fraud, yes. Intentional (unless a mistake) misrepresentation (lie) of a material fact (assumes it’s material to your new employer how much you made before) made with intent to induce the other person to act (try to get them to give you more money) and upon which the other person relies to their detriment (they DO give you more money BECAUSE of that figure). They’d have to prove all the elements, and you could defend in many ways, so it’s not 100% clear. Bottom line is: never lie outright, and definitely not on paper.
Lucy
@lawdj: that is not “illegal” — it may be a cause of action, but illegal implies state involvement. Breaking a contract, similarly, is not illegal — you can sue for the breach, but that’s not the same thing.
coco
Absolutely make sure you negotiate an appropriate amount of vacation. For example if you’ve earned 4 weeks at your current employer, and the new employer says that new employees start at 2 weeks, definitely negotiate to get the additional 2 weeks added. It costs the new company nothing, and makes them look good.
Chicago K
I thought that is was illegal for HR to disclose your current / past salary to a caller wishing to verfiy? It may vary by state, but and HR friend told me they are only allowed to answer YES or NO to a range stated by the caller and not give any other details other than employment dates and official job title. I think being within $5,000 of the # would qualify as within the range?
I am not saying it is ethical to lie, because obviously it is not. I am just wondering how it can be verfied by a potential employer?
A
I don’t know about the legality for HR either*, but a lot of employers seem to have moved to a policy of only confirming employment and employment dates.
Shayna
Here in NJ that’s the custom… too many libel lawsuits, I believe.
Although I’m not certain what background checks report, and every job I’ve had since college (I’m in finance w/ sig. $ amounts in play) has had one as a condition of employment.
MLB
No, that’s not illegal either. Again, it’s a bad idea for HR to disclose more information than that because they open themselves up to a possible defamation claim by the prospective employee. But it isn’t illegal any more than it is illegal for you to lie about your current salary when negotiating your new salary.
S
Instead of giving your salary, talk in terms of your compensation package which includes salary, benefits, options, etc. which gives you the ability to place a more subjective dollar amount on benefits. Just keep in mind most employers will want to know your salary history/expectations before they will talk to you to avoid wasting everyone’s time.
dee
This article lost all credibility with me when it said that lying about your salary is illegal. Seriously? Show me the penal statute that criminalizes lying about your salary to a prospective employer. What do you guys think the sentencing guidelines are?
If you don’t want to lie, maybe you could say something like, “Well I currently make X, but part of the reason I’m looking for a new job is that I don’t feel like I’m adequately compensated for my seniority/skill set/experience/hours/etc. That way you’re honest and you’re letting them know you need more than what you’re paid now.
Finally, when I got my job offer for my current job I asked them if they could raise the salary and they did, by 6-7%. At the end of the day, $5k or $10k means a lot more to you than it does to them. And they might do it to show they really want you and as a sign of good faith.
happyness
Amen Dee! I just love it when people squawk out “that’s ILLEGAL!!!” (gasp)
AnneCatherine
Yeah, . . . as soon as I saw “illegal,” I knew not to really go by this. I mean, this is sort of funny. What law would you be breaking? Would it be fraud? Personally, I would not ever lie about it, but come on, it can’t be “illegal.”
Once, when I was in a different field, I was told “we were thinking of paying you $__. Do you make that now?” I said “no, I don’t, but I don’t consider myself bound to make what I make now.” Maybe it’s because I was 23 and foolish that I said that, but it worked. I got a $14K pay raise, and the interviewer even said “Good for you!” Look, I don’t know if this would happen if the stakes were higher (I was not in a professional position then, or making a professional salary), but (A) while I wouldn’t lie [even though I doubt it’s “illegal,” and I think it’s irresponsible of NYT to take HR folks’ word for that] (B) I honestly don’t even think it’s anyone’s business. Am I too naïve? I’d say to turn it around somehow, asking the interviewer what the position pays, or to make a noncommittal statement like “I think a fair salary for this position [the one you are interviewing for] would be $_____”. Why should they get a discount if, for instance, your current employer underpays you?
When you get right down to it, how is your current salary actually relevant to the prospective employer? Oh, I know, they’d LIKE to know it so they can “beat it” by the smallest possible margin that will get you to switch jobs, but there’s probably lots of things they’d like to know (Are you planning to have kids in the next five years? Do you have any health issues?) that they just have to wonder about. Why isn’t this one of them? What is the purported/supposed reason for asking? I mean, I understand the real-world reason; is that also the reason they present (“We want to compare what we are thinking of paying you to what you are making now”)?
Ru
I like your attitude – you gave a great response to that question.
anon
Can we please stop confusing “illegal” with “criminal”? Please? There are civil laws too…
Lucy
Yes, agreed, but we (and the NYTimes) also need to not confuse a private cause of action (or the defense of one) with illegality.
My guess is that while lying on some job applications (e.g., for govt employment, where you’re stating under oath that you’re supplying true info.) is not illegal, criminally or otherwise.
L
When I moved jobs, I was going from biglaw to small law. In biglaw, everyone knows what everyone else makes – salaries are generally in lockstep, so if you started work in 2004 you are making X amount. The salary scales are easily found on NALP and Abovethelaw.com, etc. So my new employer knew what I was making.
My salary negotiation was a bit different because I knew I was going to be taking a big pay cut with the difference in firm size. I went from FT (big firm) to PT (80%) but in actual hours, the hourly requirements at the small firm were 68% of the big firm. They offered me a figure that was 37% of the big firm comp. I came back with a range that was 48%-55% of the big firm comp, saying to them that the additional 13-20% discount represented quality of life/flexibility, and we ended up settling on a figure that was about 45% of the big firm comp. It was below the bottom of my range, but I was aiming high, so I was pleased. I also received 100% benefits and don’t have any employee contribution on health care, which was much better than the benefits package that I was getting at the big firm.
I guess this is mostly helpful for lawyers who are moving out of biglaw to smaller firms – know that you will be taking a BIG pay cut to do so. But – the small firm that I am at now is so much better in terms of flexibility (telecommuting, etc) and culture (fewer, if any jerks!!), that it’s worth it for me. I get to see my kids and I am almost never needed on my day off (I am off every Friday).
dee
OMG I agree. I moved from biglaw to smalllaw and it’s like a completely different world over here. I get 50% of my former compensation, but I work 40-50% less, and when that 40-50% is the difference between working 40 hrs a week and working 55-60 hrs a week (and not working for yelling jerks), the pay difference is very easily justified.
L
Exactly. The partner I work for thanks me for the work I do (!!) and there is no facetime requirement at all. It is awesome.
fresh jd
How do you negotiate salary if you are coming straight out of (law) school into your first job and not going into biglaw or a GS-Scaled govt salary?
dee
research. firms are tight-lipped about this stuff so you’re going to have to ask people. try to network and talk to people candidly who are in your field and ask them what they think someone starting out should make (this should be easy to ask if the person has more than 3 years experience because it’s not like you’re asking personal information). Ask about benefits too. Try to find people who went to your law school and who are partners or are senior associates. They may even be comfortable telling you what they made when they started.
And maybe in this case you can fudge the truth a little bit – when negotiating, say “Well I’ve done some research and it seems like industry average is X” but (reasonably) inflate that X number. That seems less unethical that lying about your salary, although I’m not sure it is. I would do it, though.
Ex-3L Sarah
I’d like to know the answer to this too! It’ll help when the offers come rolling in…any day now… ;-)
I almost think that, given the economy, whatever they offer (as long as it’s reasonable) I would take. But if it’s OK to negotiate for a higher salary, then I’d do it. Why not? Aside from the whole ‘beggars can’t be choosers’ thing, of course…
dee
can’t hurt. I asked and I got it. I didn’t even really give them a good reason – I was just like, can you pay me more? please? pleeeeaaaaaase? and they did.
L
I think you are expected to negotiate. One of the “women in business blah blah” books that I read recently said that most men negotiate and a lot of women don’t, which contributes to the pay disparity between men and women. Ask for more! It can’t hurt. I think the amount to ask for depends on the numbers (eg 10K on a 50K salary is a lot more than 10K on a 150K salary, etc.), so you might want to go with a percentage instead.
AIMS
I think part of the negotiation can include the reasonableness of the salary. After graduation I was shocked to find out what some just-out-of-school lawyers were making! A friend went on an interview where they offered to pay her $13/hr. Not that it would necessarily work out, but in such a situation, I don’t think it would be unreasonable to say something like , “you know, such a salary would not enable me to cover even my basic living expenses in this city, would you be willing to increase that?”
jcb
Yeah. I switched jobs last year and tried to negotiate. They offered X – I said, X is much lower than what I was expecting; can you let me know the range of pay for others in this position; they said, X is based off of the bottom of the range, you will have to work your way up; I said, I do not expect to be at the bottom of my class, and I don’t think you expect me to be at the bottom of my class, I deserve to be paid at least mid-range; and they said, no. And no one else was hiring, so there you have it.
In sum: me: I want more; them: no. Negotiating without the leverage of a good market is just treading water!
Amber
Is there a certain percentage that is normal or “okay”? I mean, I obviously want to make as much as possible, but I don’t want to suggest something too much higher for fear of not being taken seriously. This is assuming that the employer’s offer is a reasonable one for the position.
Andromeda
The books on salary negotiation I have read have suggested that your initial offer should be anywhere from 5-20% above what you think the top of their range is; they don’t give a lot of guidance for how you pick a percent within that range. I’m going to assume it depends on your negotiating skill and confidence level (and, well, the economy, and how many other options besides you your prospective employer might have…)
Erin
Ask for about twice as much as you actually want. If they offer 50K, and you really want to make 55K, ask for 60K. They’re unlikely to give you what you ask for, and if they do, great! In general, though, I wouldn’t ask for more than 20% more.
becca_ll
If your program’s career services office is any good, go ask a counselor there. They should have some “ear to the ground” knowledge from your fellow students if not actual cold, hard, data.
I’m in the consulting industry (not a lawyer) and my program’s career services office was absolutely stellar in terms of letting me know when I was getting lowballed and when it would be useless to negotiate, given the generosity of the package.
dee
one final thing before i return to actual work: if you’re a lawyer (or anyone else who bills), try to find out your billing rate. Sometimes it’s obvious (I get my monthly bills) and sometimes you can figure it out with a little snooping (look for client bills on the network – hey, if it’s on the network and not password protected, that’s their problem, not yours). You should probably be generating 3x the amount of money you earn for your firm. If you’re generating more than that it’s time for a raise. Don’t go in like, well you bill me out at $300 an hour and pay me $50, give me my money. More tacitly, be like I earn a lot of money for this firm and I think I deserve higher compensation.
L
I’ve never heard of people not knowing their billing rate, what is this heresy? :)
dee
do people commonly know their rates? I knew the “range” I was billed at but didn’t know the exact number until I happened upon a bill. Those were my biglaw days, though, so I wasn’t in a position to negotiate and the information was more interesting than informative.
E2
I think the answer is yes. My biglaw boyfriend knows his exact billing rate, as do his law school friends.
lawDJ
you can see it when you enter your time online at my firm, and at another firm where I summered.
RR
Yes, they just tell me when I ask. We have to do marketing, and it looks ridiculous if a lawyer doesn’t know their own billing rate, so I can’t imagine the firm withholding that info.
S
In Big 6 (it has been a while) public accounting, we knew ours.
becca_ll
I’m in a private consulting firm and our rates are in every client proposal letter we send.
Erin
I know mine, but many of my friends do not.
Biglaw Refugee
At my BigLaw firm we did not routinely know. I learned, first when I was asked by partners to review the bills for my matters (something that only senior associates are asked to do) and second, when I got involved and went to our marketing department to ask for my billing rate and that of the partners whose services I was selling. I suppose I could have called marketing and asked as a junior associate, but I wouldn’t have known to. People probably have an idea just from people talking, but it’s not something displayed in our time entry software or anything.
Ex-3L Sarah
When I interned at an Attorney General’s office, they told me how much they would bill someone else for my time. They had to include my rate when they come up with the “fees and costs” part of a settlement. The DAG’s time is billed at $xxx per hour, and my time was billed at $xxx per hour. Of course, I got a much lower % than 30% of my actual fee in my checks. Wahoo public service!
M
My firm (medium-law) emails a spreadsheet to all associates each month where we all see how much every associate is billing at, what was written off, and how much was actually collected.
1L (Summer) NYC
Haha, I know my billing rate, and I am a summer.
kaydee
Please write more comments! I might be getting a job offer next week so I need help!
Anon Today
Related hijack:
I make about 70k (base) and earned a similar bonus last year in asset management (plus another 8k in 401k match, and good benefits). I am thinking of trying to move to another asset management firm, perhaps with more of an alternative focus (hedge fund, private equity, etc.). I’ve been working 3 years – straight out of college. I’ve been thinking I’d like a $100k+ base. Any commentary on whether that’s within the realm of reasonableness given what I’m making currently?
People talk about asking for 5-10% more, etc. and I’ve heard people here say they were shocked others ask for 15% more. 15% would put me at just over 80k – is that where I should be setting my sights more realistically?
lawDJ
I think whether 100k is reasonable entirely depends on whether that’s reasonable for someone in your position: 3 years experience in a hedge fund / PE. I don’t have much experience to say specifically. Do you have friends in the types of firms you’re interested in joining?
Anon Today
Thanks. There is a HUGE range and I naturally tend to think I should be toward the higher end of it ;-), but maybe I’m being unrealistic.
lawDJ
There’s a huge range for people with 3 years of experience? I guess then it all depends on arguing for why YOU are different (better) than other people with 3 years of experience. Make sure your resume highlights your accomplishments and especially any that increased the firm’s bottom line. Make sure to bring those up often before and during salary negotiation.
becca_ll
you might be able to get $100k base, but be prepared to sacrafice a decent amount of your variable.
Your overall comp is $140,000. If you are going to ask for your comp to change from 50% variable to 28% variable, you are asking a firm to take a big risk. There’s a premium to reducing risk — and you are going to have to bear part of that.
If you want to make $100k base with 50% of your comp variable, you’re really asking for more like a 50% raise, not a 25%. Just keep that in mind. Unless you are insanely good (and if you’re only making $140, you’re decent but not phenomenal. unless you live in wichita) you’re doing OK, but not $200k.
Anon Today
Thanks for your response. That’s a good framework for thinking about this. And I agree with your assessment that I’m good but not phenomenal, though comp has been pretty much lockstep by year in my group (for the first four years) since the beginning of time so I try not to judge my worth by my current comp (e.g., I’ve passed all 3 CFA exmas while a coworker at my level has passed none and our comp has remained identical).
I’m definitely willing to accept a theoretically lower bonus for higher base. I suspect my current employer is not clever enough to think about things that way (after I started, they bumped the base up for new analysts, bumped the signing bonus down by a corresponding amount, and annual bonuses haven’t budged – leading to higher total annual comp), but perhaps other employers are and that’s a risk I’m fine taking.
becca_ll
well, if you know you’re willing to take the increased base for decreased variable comp, you have a good starting point for what “type” of firms you’ll want to seek out — look for places that tout risk-mitigation type comp plans, consistency in your comp, focus more on teamwork. The firm’s strategy & ops should reflect the comp for the three elements to be aligned and effective.
And while you can (and should) justify demanding a comp increase with your certifications (I’m not super familiar with the CFA process, so if you can’t legally call yourself a CFA, this may be null) when negotiating with a new employer, remember that your current employer is looking at your performance to determine your bonus and/or raise increases. If you have 3 more certifications than your colleague, either you’re not outperforming him/her or you’re undervalued. One of the best ways to make your firm reevaluate your value is to get a bigger offer and dangle it in front of them.
As far as the change in signing goes, this could be a revenue cycle thing (more people signed during periods when net working capital was tighter) or they could have gotten burned on people walking with their signing.
And to caveat…. I’m a management/strategy consultant. I’m an M&A specialist, but I end up dealing with a lot of comp/employment agreements since I only work with entirely service businesses in a very specific sector and comp payout easily dwarfs on-paper assets about a year post-acquisition for the majority of clients.
None of my clients are financial services/finance industry projects, so I’d take comments on the “firm structure” stuff with a grain of salt. I do have a few friends at various levels in the hedge/ibank area and know what their ranges are.
Btw, since you’re still fairly early in your possible new job search, it is SO SO SO important to know how much (or a range) of what all your friends/acquaintences who are in your industry above and below your level, at more or less prestigious firms, in areas you might possibly want to work, etc. Most people have no problem concurring if you guess the range, if you get to them in private and slip it into conversation.
This will help you immensely if you ever want to switch jobs. Think of it this way, every firm HR professional knows exactly how much the comparable employee at their firm “should” make, and how much value is created. Why shouldn’t you at least have your own straw model?
anon23
Curious if you still negotiate when you get an offer that makes it sound like your salary is set. I got a written offer that said “we pay our first year associates x amount…” I accepted it (it was quite competitive for a mid-size firm mid-size market) but I negotiated other perks (moving expenses). Basically everything I asked for I got. I wonder if I should have asked for more money too. I am an ’09 grad so I didn’t want to risk it and this job was a reach job when I applied so I was thrilled to get it. I didn’t want to look a gift horse in the mouth and the offer sounded like the salary for first years was set. Would you have negotiated?
Anon Today
I was in a situation like this with my first (and current) job. I thanked them profusely for the offer and asked if there was any flexibility on the salary figure because I had been hoping for a higher number. They said “no” and that was that. :-)
Erin
When I got my current job, I asked if the salary was negotiable, and they said no. Can’t hurt to ask.
becca_ll
salary is but one part of the pie. in fact, dollars are one part of the pie. don’t forget
– paid time off — asking for more means you can use more. Especially if you can accrue for several years. Getting an extra week of PTO is like adding a few grand to your paycheck.
– location. chicago is somewhat cheaper than nyc if you get the same salary. you may have family in one location. you may really want to live one place over the other for various personal reasons.
– benefits. are your insurances fully paid by the firm? if not….
– starting/signing bonus — ok, this is money. as is your relo.
– office accommodations & other perks — do you want your parking/transit paid for? do you want a certain office (or not a cube?)? do you want to work with a specific person? these are a bit more business professional related than law related but, if you want it, the negotiation process is when to ask for it!
and the BIGGEST one that imo people forget but can have a huge impact esp if you’re in a meritocracy-type firm….
– time scale for your official performance reviews. if you’re supposed to have one at 1year and you know you can reach “that point” in 6 months on the job, you can ask for your performance reviews to be earlier or more frequent.
Emily
I might be off-base, but in my regional area we have something called a “Business Book of Lists” (not to be confused with the Book of Lists, which has been banned in parts of the country…). It is updated every year and includes demographic information, market trend information, employer information, etc – basically anything you need to know about the broader market. It’s not free, but I think my college and law school career centers both made it available, and it’s probably at the local libraries too.
Ours is put out by the American City Business Journal, but it looks like Crain’s might publish something similar for other cities. I worked in a career transition firm for a year, and we always started laid-off employees with a book like this.
MHU
I’m struck by the comments of those who say they didn’t want to risk asking for more money. I’ve never heard of an offer being rescinded because someone tried to negotiate for more money. Don’t give an ultimatum, but do ask.
becca_ll
I know one person who had it happen but, honestly, if you know the offer is fabulous (it was a good 15k above his next highest offer) then don’t bluff and say you think they can do better. it makes you (1) look like a greedy bugger and (2) wildly misinformed/histrionic
Another anon
I can highly recommend the book “Getting to Yes” by the folks at the Harvard Negotiating Project. That, and actually practicing out-loud with my husband _really_ helped when it came to negotiating. My strategy, when they offered an average salary, was to explain all the concrete, quantifiable ways I thought I was above average for my level of position. And I ended up with a 20% higher figure than they initially offered. Good luck!
Sara
I have practiced labor law and have a lot of experience negotiating salaries for others on both sides of the equation. The biggest thing to know ladies is that every situation is unique. You have to develop a strategy by gathering facts, and analyzing every aspect of the situation: potential relationships, overall market, your personal value to them (high eg special expertise, skills or lots others like you = eg new graduates), etc etc. You want to stay on professional, respectable footing with the new potential boss. Usually this INCLUDES negotiating, or they might think you are odd, unless it’s a fixed salary lockstep situation- big firms for newbies, gov’t. Even gov’t has some room usually. It’s been tough lately to ask for much in the face of recent layoffs at most organizations. A big constraint for employers is often what your peers are paid internally- they can’t often go above this number. It can be hard info to get from the outside. Everyone says research- well detailed specifics are not easy to come by in many cases, which puts you at a big disadvantage.
It’s always hardest to do it on your own behalf. I moved this year from a job I didn’t like to a dream job, but feel like I should have gotten somewhat more money. I negotiated hard at first, but I knew my position had been laid off last year and was now being refilled, so didn’t feel like I could push too hard. I took the new boss at his word when he told me his limit. However, I see SO much money being thrown around the company- I feel like they could have done it. I gave up much better vacation leave and have some higher costs so even though I got a 5% raise it feels a bit low. But- I have no regrets on taking the job (only joy!) and consciously took a long-term view. Now that I’m where I want to be, I’m developing a strategy to move into the executive level within a few years, which includes huge potential increases in the compensation package. And I am not worrying about company costs I incur much- I am choosing the more comfortable travel arrangements for myself (direct flights, convenient hotels) figuring I deserve that, especially when flying on a weekend, working late, etc. Those travel costs already exceed the extra salary I asked for but didn’t get- while not money exactly, it helps me to think about it that way. I don’t yet know where I stand compared to others at the company, and may never will. I am bothered that a few guys I know make slightly more for lower level work, but they do less enjoyable types of work, so it could be what the market will bear. Supply/demand. Or, I wasn’t tough enough. Wish I knew!
It’s easy to say things like “make sure you get more vacation” but fighting against the company culture can make you seem like a primadonna. These are tough issues. It’s also challenging with big companies that have proprietary salary schedules that you can’t find online. It is hard to negotiate if you don’t know the parameters! Rather bizarrely, my new job required WRITTEN salary negotiations, where you login to see your offer letter and can hit “accept” or contact them to have a “counteroffer” button added so that you can send a written statement to the compensation committee. This was super weird to do, and eventually the boss called to talk through it. But for a while, I had no idea who was behind the internet wall- wasn’t clear if boss/interviewers were even part of salary talks, or if it was HR, and couldn’t get clear answer. Smart on their behalf- it was disconcerting for the recipient!
Ultimately, just gather what you know, make an assessment of how to proceed, run it by a few trusted people who have done hiring before, and go for it. I have lectured many a lady friend on the ills of not trying at all- we’ve all seen the numbers on women being paid less. Well, women almost always ask for less- we generally don’t like to seem like in-your-face badgers. It’s odd for me to observe myself: I have no problem being aggresive for others, but it’s super hard for myself! So I force myself to do it. And overall am happy with my low-six-figures salary to do a dream job.
What I found persuasive when being pitched for raises: concrete accomplishments are the best. market comparisons have limited value as they can often be cherry-picked, but they are useful. Practical concerns, like long hours, new health risk/ impacts, etc. Valid statements about retention problems. One of the best ways to get agreement is to negotiate new money structured in a way that also adds value to the employer- ie money for training, certifications, productivity-related improvement bonus or program, group achievement – target bonus, etc. Win-win and not just ramping up salary scales.
The worst stuff to hear: I just deserve more; I am due for a raise; so and so gets this, so should I (so annoying). Anything about personal expense situations (not the company’s problem). I hate when they cite what people above them make. Compression among job levels is a valid issue, but acting like you deserve just under what the people above you get is crap, because they are usually the bosses for reasons: higher ed (which costed them); leadership skills, etc. It just annoys the employer.
Okay I’ll stop! There are decent books / websites out there on this, but in the end you must create your analysis of the unique circumstances.
Biglaw Refugee
This is a helpful post – thank you!
Ru
Concur with BigLaw Refugee – thanks!
Scarlett
Speaking as an Corporate HR Recruiter (albeit a Canadian one)…salary negotiating begins from the start. A good recruiter will try and pre-close a candidate during the interview process. By the time you get to an offer, the recruiter knows what your ‘hot buttons’ are, what your total compensation package looks like and why you are looking to make a move in the first place. They know what to dangle in front of you in order to make you want to accept the offer. And they will absolutely know what you will accept in terms of salary/compensation. The Recruiter is the one who knows what the managers budgets are for salaries and will be the one to work with the hiring manager do determine what salary to offer you. They may play dumb, but they aren’t. ; )
When faced with the salary question – be honest. A good recruiter will confirm salary details during a reference check with your former employers. Any kind of deceit at this stage, and you can kiss your candidacy good-bye.
Also – Do. Your. Research. Go into an interview prepared. There are lots of salary comparisons out there that will let you know what kind of scale the rest of the market is paying – both on the low end and the high end. (Canadian, but Workopolis has a great one – at http://www.workopolis.com under Career Resources). Once you have the basic market range, ask the recruiter to explain more about the duties of the role – what is involved, how much of a step up is this going to be from what you are doing now, what does their total compensation package look like? From that – say something along the lines of “Based on the qualifications for this role, I would expect $X – $Y base, as that would be competitive to the market compensation for a similar role/duties.” Have an argument ready for why you think are you worth how much you are asking. What can you bring to the job that no one else can? What are your strengths? If you ask for more, you better have a good reason to justify it!
If money is the most important thing for you in a job offer and if you are not going to accept an offer lower than X, then give X as the figure. Just know, that after this recent recession, most companies do not have a lot of extra funds rolling around, and are certainly not going to give you a whopping raise just because you want one or just because you asked for one. If you give a range, be prepared for an offer at the low end of the scale. Why should a company pay more money than they have to, right?
If you do get an offer – with a salary that is less than ideal in your mind- be smart about asking for more. A close ended question such as “Is there room for negotiation on this?” is most likely going to be answered in a “No”. Again, most companies have small budgets, and want to get the best labour out there for the lowest possible price. A better negotiating tactic is to say, “I appreciate your offer and am very excited about it, but I will admit I am a little disappointed at the compensation you are offering. Based on our conversations before/or from learning more about what the role involves, I was expecting an offer around $X. Let’s talk about how we are able to come to some kind of compromise on the salary”.
I have absolutely seen offers withdraw because the candidate botched the salary negotiation so badly. One that comes to mind was a candidate that said he was comfortable with $50k annually, and then when an offer was on the table, asked for $50/hr. The offer was off the table immediately.
Absolutely know your worth. And don’t be afraid to tell an employer why.
E
Eep. The first thing I thought when I saw that was: a slip of the tongue on his part!
I don’t know what Canadian hours or annual leave is like, but here in Ireland a guideline is approx. 250 working days a year, 7.5 hours a day. At $50/hr that would be nearly twice his original ‘comfortable’ salary! Wow!
A Dub
I was wondering if anyone had tips for negotiating a bigger raise with a firm you have been employed at for a while (and by while I mean almost 5 years…). I am at a small firm (9 attorneys) but we just hired 2 more to start in the fall, we just received our annual raise and I was really disappointed that it was 1.5% – not even inflationary. Any thoughts?
E
Inflation is running quite low right now…
Sara
Actually the COLA this year was minus two (below zero), so you are lucky in some ways to have gotten anything. (COLA – cost of living increase based upon inflation- what governments use to calculate automatic raises). Not that lots of people didn’t get merit raises, etc. but just to let you know.
Your best line of attack is the additional duties argument. Have you been assigned new responsibilities, taken initiative in new areas, brought in business, honed a special area of expertise? These are great reasons to ask for more in same organization.
Marie-Christine
First read “women don’t ask” by by Linda Babcock and Sara Laschever. Then you can start thinking about what exactly you want :-).