Being offered a job is a reason to celebrate, but it is also an opportunity to negotiate the best terms you can get, which may not come up again for a while. You should maintain a professional, friendly tone during these talks as you forge a relationship with your new employer. “Once you receive a job offer, you stop being a candidate and you start being an employee of the company to some extent,” says career coach Paolo Gallo. “The way you negotiate starts building your reputation.”
Figure out your priorities, ask for what you want, and keep in mind all of your options. “Think about the entire compensation package and not just the pay you’ll be receiving,” says Dr. Hamaria Crockett, a career coach with Korn Ferry Advance, the career-coaching arm of organizational consulting firm Korn Ferry.
1. Know your numbers.
If you haven’t already researched what your pay should be, do this now. Don’t go into the negotiation blind. Use publicly available information or network with current or former employees at the company. Websites like Payscale.com, Salary.com and Glassdoor.com also track salaries for particular roles. You want to know what those in comparable positions earn at the company or at similar organizations so that you can back up your counteroffer with hard data.
2. Find out what is negotiable beyond the salary.
Job candidates often focus all of their attention on the base salary and miss out on other aspects of the job offer they can negotiate. You should have a thorough understanding of the entire package, including health insurance, retirement benefits and time off, before deciding how to counter.
What to consider in your counteroffer:
- Health insurance. Does it include dental and eye care? Find out what the copays are and when benefits kick in. For example, you can negotiate a reimbursement of Cobra health insurance payments if there would be a gap in your coverage.
- Retirement plan. Find out the type of plan the company provides, whether they match employee contributions and, if so, by how much.
- Bonuses. Some companies offer a signing bonus to help seal the deal or if they can’t meet your salary target. You can also negotiate the length and terms of the clawback period, or the time you have to remain employed to keep the bonus. Keep in mind that bonuses may be taxed differently than your base pay.
- Stock options. If these are part of the offer package, you can ask for more options or a change to the terms, such as accelerating the vesting period.
- Vacation time. You can negotiate more time up front, instead of waiting for it to increase over time.
- Parental leave. Some companies have a policy that goes beyond the three-month period typically offered to parents. If this matters to you, take the company’s policy into consideration.
- Flexible work. Does the company allow a four-day workweek? Or can you choose when to start and end your workdays? Think about a working structure that would suit you and allow you to fulfill the duties of your role.
- Remote work. Beyond the current pandemic, is working from home on a particular schedule a long-term option?
- Job title. This is sometimes easily negotiated since it doesn’t cost the employer anything.
- Education stipends. Some companies offer this as long as it is relevant to the job.
- Allowances. The company might offer a stipend for your car if you use it to do your job or a company credit card to cover expenses.
- Severance package. While it may be difficult to imagine now, there could be layoffs or a company merger in the future that affects your job. A good severance package can give you peace of mind and pay off in the future. Now is the best time to negotiate one, while your future bosses are wooing you and don’t think they will ever have to use it, according to Wayne Outten, the founding partner at Outten and Golden, a law firm that represents workers in employment matters.
After you have laid out all of the above, calculate what impact the benefits package would have on your take-home pay. Prioritize what matters most to you, so you are clear on what you want most before you begin negotiating.
3. Ask how the employer came up with the salary.
Find out how the employer determined your pay in the job offer. If there is a discrepancy between the job responsibilities or the salary compared with what is typical for this role, say so without mentioning any numbers. Give the employer a chance to propose a new number. Dr. Crockett recommends saying: “After hearing about the role, it seems like it’s a heavier lift than what you’re offering. How did you come up with that figure?” You could follow up with: “How much are you willing to negotiate?” This gives you an idea of what the projected range is. Keep in mind that whatever it is, you can aim higher. If you are the candidate the employer wants, at this point it could be an emotional decision for the hiring manager.
4. Explain why the job offer falls short relative to the responsibilities.
Based on your research, you can now share what people in similar positions in the same industry and location are paid, and how valuable your skills, credentials and experience are for the role. This is your chance to pitch yourself, as you did during the application process, by raising all of your strongest attributes and past successes, and reiterating how you are exactly what the company needs. Then propose your ideal base salary. The worst they can say is “no,” at which point you still have room to negotiate other elements of your package. Be prepared to answer tough questions. If you say the role is a heavier lift than what the compensation signals, you will need to explain why.
5. Lay out all of your requests at once.
Now that you know what the benefits package is and what you can negotiate, use it as you counter. Try to request the benefits changes all at once. Don’t make the mistake of negotiating only one benefit, such as a flexible work schedule, only to secure the terms you want and then go back to request something else. “You don’t want to nickel and dime throughout the negotiation,” says Dr. Crockett. “That’s a turn-off for any company. No one wants to deal with that.”
If you are going to ask for several adjustments to the offer, try to keep the hard and soft requests separate. Anything related to pay, bonuses and stock options should be negotiated together, as part of your hard requests. Once you have gotten to an agreement on those, move on to the softer requests like vacation time, flexible work and job title.
6. Consider requesting a two-part raise or a prorated bonus.
If you can’t negotiate the salary to what you expected, one way to get there is to request an automatic raise six months into the job if you meet certain goals. “Anytime you can prove your value before you get your reward, employers are quite happy to give employees what they want,” says Tessa White, a career navigation adviser and founder of The Job Doctor. You can also ask for a prorated year-end bonus if you are starting in the middle of the employer’s financial year.
7. Never give an ultimatum. Instead say: ‘Yes, but…’
Take a polite approach when countering. “You don’t say, ‘I’m not coming,’ or ‘I am coming,’” Mr. Gallo advises. “You say, ‘I’m flattered, I’m honored to receive your offer of $200,000 to start in X months.” Then you detail the facts that back up why the job warrants better terms, based on your experience and research, he says. If the number is short of what your salary would be at your current job after an annual raise next year, say so. If you are missing out on a bonus by taking the position, include that.
“Say: ‘I’m happy to come, but by coming now, this is what I’m leaving behind,’” Mr. Gallo says. “Every single time I did this, I got 5% to 10% more.” When you back up your request with evidence, it is hard for an employer to argue, he says: “Facts are a stubborn thing. Here you fundamentally provide the evidence to say: ‘I’m prepared to come, but maybe your offer can be revised because of the facts.’”
Additional ways to word this polite, fact-based counteroffer:
- “I’m honored to receive your offer for $50,000 to start in one month. I want to share with you that my current salary is $50,000, and if I were to stay, I would make $60,000 next year. Given this situation, I would really welcome the opportunity for you to reconsider the salary on offer.”
- “I would be delighted to accept the position, but I want to bring to your attention that if I were to stay in my current organization, I would make 5% more in the next month due to an upcoming raise. Would it be possible to revise the offer to account for this?”
- “I would be delighted to accept this opportunity. Given that I would miss out on the year-end bonus due to my start date, would it be possible to revise the offer to include my annual bonus up front?”
- “Thank you so much for this exciting offer. I would be honored to work for your team and this organization. I wanted to mention that my current employer provides a medical plan that includes dental coverage, and I understand your company doesn’t cover dental insurance. Since it would cost $3,000 a year to cover dental care for my family, would it be possible to revise the offer to include this amount in my salary?”
8. Negotiate face-to-face if you can, but then get it all in writing.
It is always best to negotiate face-to-face, or at least over the phone, so that there isn’t a lot of back and forth over email. However, once you do finalize an agreement, make sure to get it all in writing, over email as well as in your offer letter. Otherwise, if your employer leaves the company, or simply forgets, those agreements are null. “If it’s not in writing, it didn’t happen,” says Dr. Crockett.
- O*net: This Department of Labor-sponsored website provides a comprehensive look at the skills required for specific jobs across all industries, plus median pay per job.
- H-1B Data: As part of the H-1B visa program, companies must keep a public-access file that includes the exact salary of the employee they sponsor. This website collects some of those salaries and allows you to search by company, position, location and the year the candidate was hired.
- Payscale: This salary comparison website requires that you enter your data before it shows you anything.
- Salary.com: This comparison site allows you to see payscale by profession, industry and various other variables.
- Glassdoor: You can browse salaries by company and position. The salaries are entered anonymously into the website by employees.
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