How and When to Negotiate Salary and Benefits?
The following is a question about negotiating salary and benefits that arose out of a recent webinar I did entitled “Resumes, Interviewing and the World of Work” for Georgetown University alumni. That webinar was offered to give the participants information about “the best way to find a new job”!
Thanks for taking the time to speak about resumes and interviewing today. I enjoyed hearing your take on the best way to prepare yourself. I do have one question you didn’t have time to answer– What is the best time and manner in which to negotiate a salary? After getting an offer, what’s the most appropriate way to ask how much the position pays and then to start the negotiation process? I’ve never had to do this before, so I want to know what to do when the time comes… hopefully sooner rather than later!
My response follows:
Glad you found the webinar to be of value!!
Great question! Let me give you part of the content from my book “The Ultimate Job-Seekers Guide” on this subject; the following is an excerpt from Chapter 11 – Congratulations! You Have an Offer! Now What? Evaluating Job Offers; Negotiating Salary and Benefits
Negotiating Salary and Benefits
The time to negotiate salary and benefits is after you have received a job offer. Why not earlier? Because you don’t want to negotiate against yourself. Your employer contact knows your compensation history and knows the compensation range for the job he or she is trying to fill (and hopefully you know the range also!). This person is aware of all the answers you and other candidates have given during the interviewing process. Your employer contact has also made comparisons of whom else they have been interviewing for the job and how large the pool is of people to choose from (your competition for the job). From this base of information, a decision will be made as to whom to make the offer and at what salary. These factors will determine if the offer is at the high end of the range or not. Another factor that enters into formula is your current employment status; if employed, the offer may be higher than if you were unemployed. The benefit package is probably formula-driven for the position you are interviewing for, so little opportunity to tinker with it.
What then do you negotiate? Actually, very little. If the salary range is $45 – $50,000… and your last salary was $46,500 and the offer comes in at $47,000 or $47,500 – yes, you are disappointed it wasn’t more. Recognize, however that it is an increase and be assured that the hiring official thought it through and felt that the offer was a fair one. In almost every case, the salary detailed in the job offer has been carefully thought through; the employer wanting to pay as low an amount as is reasonable to attract and hire the talent to do the job. If you ask for an adjustment because you don’t feel it is enough you are not sending not the best of messages!
The best approach is to “pre-negotiate” the salary during the interview process. As noted in the interviewing chapter:
If the interviewer asks “What salary are you looking for?”
- Answer carefully. Hopefully you know the salary range ahead of time. If so, you answer: “well, I know the salary range is $X – $Y. My last salary and bonus plan paid $Z on an annual basis. While I would like to be at the high end of your range, I am primarily looking for opportunity first and am prepared to be flexible about the compensation package”.
- If you don’t know the range, then you answer: “well, my last salary and bonus plan paid $Z on an annual basis. While I would prefer to make some upward strides, I am primarily looking for opportunity first and am prepared to be flexible about the compensation package”. Never inflate your current or past compensation. It is not uncommon for an employer to ask to see a W-2…and your are sunk if it doesn’t match what you have said.
- By these responses, you have put a salary number on the table.
If for some reason you aren’t asked this question, towards the end of the interview, say:
“We haven’t discussed compensation. What is the range? And from there offer the first response above.
What can sometimes negotiated are some minor aspects in the area of benefits – getting on the employer’s health plan sooner than the normal waiting period, clearing during the interview that you have made travel reservations for a family reunion at a distant location and therefore need more vacation leave time than might normally be available, perhaps getting paid parking, etc. Be aware, however, that your employer likes standardization of benefits within a class or group of employees; it avoids the hard feelings that arise when workers doing the same or similar jobs find out there is a difference in their benefits plans.
Keep in mind that one of the advantages of working with a staffing service (check out my firm – NRI Staffing Resources) is that they can negotiate on your behalf without you personally interacting with the prospective employer.
Do keep in mind that what you are looking for is opportunity to learn and grow, to work for a boss who will be a mentor, and to be part of a team. Don’t get hung up on a salary if it is within your realistic range – and remember that the money will take of itself if you do a knock-out job.