GOT A GOOD SALARY OFFER? WAIT, DON’T ACCEPT IT YET
Feb 19, 2018
Roy and I have been working on his job search for 6 months now. He had been working with a Fortune 500 technology firm for over 15 years and realized that he needs to find new challenges elsewhere to continue growing in his career. Also, he felt he is quite underpaid in the market. His company is known to be a low pay-master in the market. With him staying in the company for so many years, I was not surprised that he is underpaid.
Recently, Roy reached the final stages of a process for one of the companies he had been interviewing for (something he got through his networking efforts). We had decided early on not to quote a number for his salary expectation without going through the process. A lot of people either shortchange themselves or exceed the budget while quoting expected numbers. It is unfair to the candidate as well as the company to discuss potential salary without really understanding what the role entails. Maybe the role is so great that the job seeker is willing to go slightly lower or the candidate brings so much to the table that the company is willing to increase their budget. Magic happens when people actually meet and discuss the role and their experience instead of haggling on money without knowing the full picture.
Now Roy just blew everyone’s mind whom he met in the interview and absolutely loved the role himself. It reminded him of his early days in his current company when they were working hard to meet exponential growth targets. The HR asked for his current salary which Roy was hesitant to share. However, he understood when I explained that this is how salary conversations work at the moment. Companies need to have a basis to make an offer. My other advice to him was to not negotiate immediately after getting the offer. In fact, to not react at all and get information on all aspects of the salary and benefits. Thank them for the offer and request for some time to consider.
With everything in place, the company came back with a 25% hike. 25% salary increase is great in today’s market for a Director level role. Roy was elated. Following my advice, he decided to not react immediately and get the following information:
- The breakdown of the guaranteed package
- Average variable bonus for last year (a lot of companies quote a range, just ask them how much did the particular level got last year)
- Bonus payout time and if he is eligible for the bonus
- Salary review and when he would be eligible for the next one
- Breakdown of all other benefits
As it turns out, salary review and bonus payout both happen in January and Roy would need to be employed with the company for 12 months to be eligible for both. Joining them on 1st March, the next bonus and salary increase that Roy would see would only be in 2020. He did not ask them to increase the offer. He just mentioned this fact back to HR coupled with the fact that he is responsible to meet aggressive growth targets. He needs to consider. And that is the thing with most salary negotiations. People get into negotiations immediately without getting the full picture. Knowledge is power, especially when you are negotiating on an offer which looks very good on paper.
After a week of nail-biting suspense, the HR came back and announced that the company is willing to offer 4 months’ salary as a sign on bonus with a condition that Roy would work with them for a year. They also introduced a clause for salary review after 6 months’ probation tied to Roy reaching his KPIs outlined in the contract.
The next time you are in salary negotiations, remember to ask the right questions. Even without factoring the salary hike at the end of probation, Roy has got himself an offer which is tens of thousands of dollars higher than the already fantastic offer. Now go shine your light while interviewing and get yourself a salary you truly deserve!
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