Negotiating the offer can sometimes feel like the scariest and most complicated part to the interviewing process, but really it should be the happiest. It means that they want you for the open job. Now whenever you talk about an offer everyone always immediately thinks money, money, money. Of course, money is a big part of the package, but not the entire package. There are many other areas to consider and we will discuss them all below. What you need to remember is that negotiating is a skill and takes practice. Many offers are lost due to bad negotiating, but that does not mean you should be afraid to ask for more. While most companies will give you a fair salary package at the end of the day, they have to do what is best for them from a financial perspective. Proper preparation is monumental to achieving success in this process. Get what you deserve through the simple advice listed below.
Prior to going on to any interview, you must do you research to determine what you justly deserve as a salary. There are two great websites you can use to determine what your salary should be Salary.com and Payscale.com. Simple enough, type in your job title, location and other basic information and it will return a salary for you. While you should not use this as concrete information, let it serve as a guide for where you should be. You must remember that while negotiating for the highest offer possible is a great thing, you do not want to turn off your perspective employer; they will think you are just about the money and not the opportunity. Your research should yield not only salary, but also upward mobility within your desired field. From your research, you will find how high your salary can go. Remember, research is not simply salary, but also mobility, job responsibility, perks, bonuses and flexibility.
How do you negotiate your responsibility? Well first, you must understand the job in which you are applying for and that comes from your questioning in the interview process. This will help you learn if anyone is reporting to you, multitude of projects managed and overall scope of the position. It is through this process in the interview where you can negotiate for more responsibility thus more money. Now, the caveat is that this will not work for every position. The general rule of thumb is that you should at least be at the manager level and above. Trying to negotiate more responsibility at an entry-level position will just get to view the other side of the door. At the manager level and above an example may be, instead of having just the northeast report into me, why not the southeast as well? Or, I can help expand this project into “X” thus allowing for more “Y”. Of course filling in the blanks with the appropriate jargon for your industry. While this can be tricky, if negotiated correctly, you will win in the long run, from a monetary perspective that is. What is most important is that you understand this is a fine line; many companies may be turned off if you come off as an egotistical person. You will only win if you have the record and background to prove you can do what you are saying. Below are some tips on understanding how to negotiate responsibility.
- Research similar job descriptions in your industry. What are other companies asking a similar position to do?
- From there, create your own job description while keeping in the parameters of what he company originally wanted. Prove, to the company that this, is what I can do and how I can do it. Of course, with concrete example from your past as to how you have done it.
Negotiate Any and Everything
Everything is negotiable in life; it’s just a matter of whether or not you are willing to go after it. Again, this is for mid-career and above individuals. While there are a few things negotiable at the entry-level position, most companies will not be willing to bend as you have not proven yourself yet. Now, people sometimes forget how much companies actually give them beyond their actually salary. Depending on the company, your salary might only represent 50-60% of your total compensation. What comprises of the other percentage? Things like benefits, cell phone, tuition reimbursement, vacation/sick time and bonuses. Below are some tips on how to negotiate each one. Remember, every company is different and this will not apply to each one.
Benefits – Just about every company today offers some form of benefits and it is the only perk that people believe companies will offer. First, you must understand not every company will negotiate benefits; the larger the company, the stricter they will be on this policy. A good rule of thumb is any company over 500 people will not negotiate with you. They will say you either accept or decline the usage of our benefits package and that’s okay! Good thing is 99% of all businesses are less than 500 people. So what can you negotiate? Well it depends on the company’s benefit package. What does it include? Medical, dental, vision, long-term disability, short-term disability, supplemental insurance, 401(k) plan, pension plan, etc… With all of these, you will not be able to negotiate price; most of the time. Reason being, the company has a set price from the insurance provider and that is what they have to pay. You can, however, negotiate whether you want this included or not as part of your offer. By saying no to their medical plan, you could be saving them upwards of $1,000 a month (depending on the plans you were deciding to choose). That is money that you can negotiate towards your salary. With a 401(k) and pension plan, again, you can opt not to join the plan and ask for that money to be included in your salary or the flip side, you ask for a higher contribution rate. Negotiating takes creativity and patience. Once again, every employer is different and you want to be careful not to push the envelope. Benefits are a touchy subject, but can yield you some serious $$$.
- Cell phone – The majority of today’s companies want you connected to work 24/7. Because of that, they are willing to subsidize or pay for your cell phone. There are two way you can look at this;
- Tell them you do not want to be connected and you would like that money added to your salary or,
- If they do offer a cell phone policy, ask that they pay for your cell phone.
Let’s start with the first. While most companies want you connected to their network at all times, that does not mean you have to be. You could connect your laptop at home to their server so when you go home, you are still working. Since most companies want to show that they offer flexibility and a work/life balance, they may concede you having a cell phone and give you money instead. On the other hand, some companies have no cell phone policy at all and it’s up to you to negotiate. Your case will be that being connected to the server 24/7 will allow you better access to your customer or clients thus allowing for increased customer service. In today’s economy, the #1 driver of business is excellent customer service. By you giving a solution to that problem, the company might be willing to pay for your entire cell phone bill. Depending on your phone, that could be $100 a month!
Tuition reimbursement – All employers want a highly educated work force, but also a highly educated work force that will stay with them for many years to come. There are two scenarios here; companies that do pay tuition reimbursement and companies that do not. Lets start with the first. Companies who do offer tuition reimbursement are great, but there is always a catch; they just are not going to give you the money for free. They will either giving an insignificant amount or make you sign an agreement saying you will stay with the company for “X” years or else you owe the money back. For a company who offers no reimbursement our goal is to get any amount of money because it will be more than you had before right? Your negotiation point then becomes asking them to contribute towards your tuition, at an accredited university, in exchange for “X” amount of years/months of service. For a company that already pays reimbursement, you can negotiate the amount and the terms of the contract. It is advantageous to do so for both; you want a higher amount of money paid for less amount of service. Once again, tread lightly here, you don’t want the company to think you will get your MBA and then leave and that should never be your intentions in the first place. Every reimbursement is different, some companies offer great money, but on bad terms and others vice versa. It is sometimes better to pick one area and negotiate just that. Either asking for a higher reimbursement or for less time.
Vacation and sick time – Every company offers something different; some offer vacation and sick time others will lump it into PTO (Paid Time Off). Lets start with the first. Depending on where you are in your career, your vacation time will vary; could be 5 days, might be 20 days. As with sick time, most companies will offer unlimited sick time, but other may cap you at 10 days. Negotiating either can be tricky as you cannot just say, “I want more vacation”. They will think you just want to be home instead of making money at work. This will depend on your prior positions. If your previous company offered more than what you are being offered, you can definitely tell them you want what you had to be matched. Again, depending on your seniority, they will match you or meet you half way. Say you have no prior positions, then you can ask that you take some days from your left pocket and put it your right pocket; swapping sick for vacation. Another negotiating point if they refuse to budge could be keeping their plan, but asking that they pay out what you do not use at the end of the year. Now to my second point, what is PTO? Paid time off is the new trend that most companies are moving too. It takes everything and puts it into one bank; Sick, vacation, and general time off. This allows you, the employee, the flexibility to not tell your employer why you are taking off, you simply state, “I am taking PTO”. There is less liability to the company and increased flexibility to the employee. Since there are no designations towards any particular type of time off what you negotiate then are total amount of days. Most will start with 10-15 days total. You can negotiate by going off of your prior positions and using them as a base point. Once again, if they do not budge, ask that they pay you out on all days you don’t use at the end of the year.
Bonus – Bonuses come in all shapes and sizes. There are year-end bonuses, spot bonuses, sign-on bonuses and guaranteed bonuses. All of these are negotiable, but they depend on the timing. Spot bonuses are not negotiable as they are given to you when you are on the job. A spot bonus is when an employer feels you have gone above and beyond the job responsibilities and you are deserving of an award at any random time of the year. The other three are the ones we are concerned with. The year-end bonus amount is not negotiable, but receiving one is. If the position already comes with a year-end bonus, there is not much you can negotiate, as it will be predicated on your performance. When the position does not have one, you can ask for it to be included. You do not ask for a certain number, as you do not want to insult the employer, but rather stating, if my performance was better than expected then I would like to receive a year-end bonus. Now you must make sure that this verbiage is added to your offer so at year-end you have a legal document to stand on. Second, there are sign-on bonuses. Sometimes employers may not be able to match your salary, you might simply be overpaid for your skill set. That’s okay! If a company says no to your salary expectations, you simply ask them to take the difference and translate that into a sign-on bonus. They are very common in today’s world, as the company wants to show you that they are making a commitment to you just as you are to them. Lastly, there is a guaranteed bonus. This means, no matter what, by “X” date you will pay me a bonus. These are usually only reserved for highly sought after employees who will add tremendous value to the company. That does not mean it’s not you, it means, let the company decide whether they will give you a year-end bonus, a sign-on or make it guaranteed.
This is what it’s all about, right? Well if so, you want to make sure you negotiate the best deal. If you followed the steps above, you are in primo condition to negotiate the best possible deal for yourself. The most important tip we can give you is to negotiate with the hiring manager, not HR. Here’s why. If the hiring manager really wants you, they will pay whatever number you want so that you will work at their company. It is HR’s job to make sure the company gets the best deal possible because they are supposed to know the market and what this job should pay. If you negotiate with HR, chances are they will just say no to you. By going directly to the hiring manager, you let them go to HR for you and negotiate your salary for you. It is this secret backdoor that will get you more money. Since you already did your research, you know what is fair and what you deserve. It is important to remember to understand industry averages. It is professionally acceptable to receive a raise in the range of 5-10%. Also, it depends on your experience, seniority and title. Not every position is the same and not every company will compete with each other. To summarize: Negotiate with caution. Other than that, it is imperative to know when to accept. You do not want your salary to become a bidding war because the employer will think you are just out to make more money. Negotiate tactfully and respectfully.
- Who to negotiate with – As mentioned above, always negotiate with the highest possible person. Regardless of their title; you will know who the highest titled person you met with is. But on the same token, you want to make sure that person is either the hiring manager or has authority over the hiring manager; there has to be some type of correlation. Refer to salary section above for more information.
- How to ruin your deal – Simple. Ruin your deal by lying, cheating, or being dishonest. It truly is simple: Be yourself and tell the truth. If you lie about anything, it will come out eventually. You want the company to hire you based on your proven skills and honest answers.
Just about every employer will run verifications on you. For salary matters, we only care about the employment background check. This includes W2 earnings for the last 1-10 years (depending on company policy), job title for the last 1-10 years, companies where you worked for the last 1-10 years and dates of employment for the last 1-10 years. Just about any company will have a clause in their offer that states they have the right to revoke their offer if they catch you lying on any of the above. It all starts with the application, once you submit it; you cannot change it, so please DON’T LIE! They will catch you. What is notable though is that even employment verification is negotiable, but only from one standpoint and that is when it occurs. All of the above will happen regardless, but you can dictate when it happens and here’s why. In today’s world of identity theft, you never know when someone might have stolen your identity and changed your information. Because of this, if an employer runs your background and comes back with something different, they will revoke their offer. It does not matter if it’s a lie, they will see as trying to cheat them. Here is a little HR secret that no one wants to talk about. Before accepting your offer, you tell the company that you want all employment verifications run prior to accepting. You may be thinking, well even if something comes back bad they still will revoke my offer right? Of course, that will definitely happen! But lets think of the other scenario. You accept their offer and they begin to run their employment checks (which take at minimum a week), in the meanwhile, because you are so happy, you put your two weeks notice in. Well now, the new company revokes your offer because something came back different and you already quit your job! See the problem? Make sure you get them to run all background checks prior to resigning anything.