Compensation Negotiation Tips
Tip #1: Be Prepared!
Do your homework! Find out what the salary ranges are in your line of work. Decide what salary you want and what you need; in other words, determine your personal “range.” You should begin this preparation as soon as you start sending out resumes. Also gather information about your prospective employer and its company benefits. Learn what the company does, its financial position, its status in the business community and any other recent information you can find. Find out if the company has specific grades/pay ranges they must use, or if there is room for negotiation.
Tip #2: Never discuss salary until you have a firm job offer
This also includes revealing your past salary history. Always use the word “negotiable” when asked about salary. If you reveal too much up front about your past salary, you may be pricing yourself out of a job or underselling yourself. Always tell interviewers that you are flexible and that you would be happy to discuss salary once you learn more about the position. Once you have an offer, you need to have them thoroughly explain the benefits and perks attached to the job. Benefits may include insurance, stock options, bonuses, employee discounts, tuition reimbursement, vacation/sick time and retirement funding. Perks may include a company car, club membership, parking, expense accounts, etc. Figure the value of your benefits and perks AND your salary to view the complete compensation package.
Tip #3: Don’t say yes to an offer right away
Show enthusiasm and be appreciative when you get the job offer, but always ask for at least 24 hours to think over the offer. Agree on a deadline for when you need to respond. This gives you time to get over the initial elation at being selected and to determine if the job is the best one for you. It also allows you time to review what you know about the job to determine if there are still questions that need to be answered.
Tip #4: Ask for a few perks you can do without
By asking for perks that are less important, you are giving yourself bargaining room. If you look like you are making concessions, it helps the employer feel better about meeting your other demands and encourages the impression that you have both “won.” Focus on those things which are really important to you and be flexible with the rest.
Tip #5: Never stop selling yourself
A job offer is not the time to let your guard down. When negotiating for the best possible package of salary and benefits, it is important to continue showing the employer how hiring you will have a high return on investment.
Tip #6: Focus on your goals, not winning
Too often in negotiations, winning becomes more important than achieving your goals. Not only is it important to focus on achieving your goals; it is also important not to make your future boss feel like a loser in the process. Remember, this person will exert some influence over your future career. You will have gained little by negotiating a good deal if you alienate the boss.
Tip #7: Be ready and willing to walk away
Negotiating for a salary is like a game. You make an offer. The employer counters with an offer. This “game” continues until either a consensus or a stalemate is reached. Never go into a bargaining session with the attitude that you must accept the job. The employer will see your desperation and might offer you less than you are worth. You’ll be more confident if you are willing to walk away from an offer. Know when to quit bargaining. Being perceived as greedy, unyielding, demanding or unreasonable may cause the deal to fall apart.
Understand the dynamics of the negotiations process
Negotiating should not be an “Us versus Them” proposition. Give the impression that the negotiations will likely result in a win/win. A “take-it-or-leave-it” attitude negates any feelings about you being a team player. Remember that the people you negotiate with today will be your colleagues tomorrow. Proceed in a manner which won’t tarnish your image.
Tip #9: Get the final offer in writing
After you have successfully negotiated a salary and benefits package, it is important to put your agreements in writing. Go over the points you covered in the negotiations process before you accept the offer. An offer of employment should include the starting salary, outline the benefits and perks agreed upon, your job title and a starting date. Getting this information in writing will protect you and your future company from any misunderstandings.
Tip #10: Never forget that employment is an ongoing relationship
Employment negotiations are just the starting point for your career with a company. They set the tone for your employment relationship. Get too little and you are disadvantaged throughout your career; push too hard and you can sour the relationship before it even begins. How you handle the initial negotiations can have an impact, for better or worse, on how successful you are with the company.