Career Coach

Don’t hesitate to negotiate a job offer

Ken Pelczarski | TLT Career Coach May 2019

Money left on the table initially can be difficult to recapture later in your career.

Think about having gone through the complete interview process for a great job opportunity where you have a strong desire to work for the company. You receive a job offer that is minimally acceptable and you are deciding whether to simply accept the position. Should you attempt to negotiate? Absolutely!

A startling number of job candidates fail to negotiate their initial job offer. According to a recent study by www.theladders.com, 64% of respondents indicated they accepted the first salary offer with their current employer. Unfortunately money left on the table now because of lack of negotiation is difficult to recapture later in your career.

In the Ladders, Inc., study, the percentage of individuals accepting the first salary they were offered is broken down into groups as follows:

• 84% of Gen Z workers, ages 18-24
• 74% of Millennial workers, ages 25-34
• 59% of Gen X workers, ages 45-54
• 59% of Boomer workers, ages 55-64.

Through my recruitment experience, the main reasons for failing to negotiate a job offer include:

• Lack of self-confidence.
• Not knowing what you’re worth.
• Avoiding looking pushy.
• Not wanting to start off on the wrong foot with your new employer.
• Settling for the easy way out.
• Thinking the company will not budge.
• Believing that salary negotiations are unpleasant.
• The employer presents the job offer as final.
• You are happy with the initial offer.

If you tend to avoid negotiating job offer compensation, evaluate the reasons. I am not advocating to negotiate for the sake of negotiating. It’s just inevitable there will be differences between the employer’s job offer and the salary and benefits package you desire.

Employers usually consider negotiation requests in the following scenarios:

• You are looking to earn a salary within a competitive range.
• You want to be paid fairly for your high level of success.
• You are trying to maintain your standard of living (especially when you will be relocating to a higher cost-of-living area).
• You would like to maintain a similar level of benefits that are important to you and your family (e.g., vacation, bonus incentives, 401K, health insurance).

Many employers leave room in the initial job offer for further discussion because they expect a job candidate to negotiate for a higher salary. Even if you truly believe the employer will not negotiate the initial job offer, there always is a way to request a higher salary in a professional manner where you have everything to gain and nothing to lose.

Basic rules for negotiation
Here are five of my basic rules for negotiation.

1. Know what you’re worth. Effective negotiators negotiate from a position of strength. Strength comes mainly from knowledge. Therefore, it follows that knowing the industry worth of your experience and track record is the basis for obtaining the best results in negotiating a job offer. Being armed with knowledge will lead you to having a goal regarding what is ideal and what is acceptable compensation. For example, if you learn that you currently earn a salary in the 20th percentile of peers, you will likely set a goal for a better-than-average increase.

For more information on evaluating your worth, please refer to my September 2017 TLT column titled, Do You Know What You’re Worth?

2. Be reasonable. There is nothing wrong with aiming for the top when negotiating for a higher salary. Keep goals within reason, however, by discussing a competitive range for your level of experience. A competitive range may be a wide one such as $150,000-$200,000, and you would be justified to aim for the top of this range if your level of success warrants it. Your requests will be taken seriously, and the door will stay open for negotiations if the employer sees your approach as reasonable.

3. Do not make demands. Not many employers respond well to demands, ultimatums or take-it-or-leave-it offers. I view the ideal negotiation process as the job candidate and employer amicably working together. This process should involve figuring out a fair compensation package for the individual’s experience and level of success for the specific position. A long-term employer-employee partnership is pending acceptance of the job offer, and making demands will certainly tarnish this relationship. Emphasize your commitment to the opportunity, state what is important to you, and work through the negotiation process.

4. Substantiate your requests. Employers may be inclined to say no if they do not see a reason behind a request. Explain specifically why you are asking for something and document information behind your request if possible. State what you are accustomed to receiving in salary and/or benefits including bonuses, vacation and perks. Show proof of recent salary history and benefits as you see fit. According to a study by www.payscale.com, women benefit in negotiations by revealing salary history while men do not benefit. Refer to your research on the worth of your experience as well as what this type of position is worth in the specific location.

5. Be prepared for give and take. Employers may hesitate to agree to one of your requests because (1.) it would violate company policy, (2.) it would upset internal equity, (3.) the salary would be outside the pay grade, (4.) they have never done it before and (5.) it may set a bad precedent. Keep in mind that even though employers might not offer exactly what you request or match your current benefits directly, they will frequently present something of equal value as a tradeoff in your compensation package (from the coming list). Be prepared to compromise on individual points and look closely at the overall compensation package.

Many items within a salary and benefits package can potentially be negotiated:

• Early salary review
• Specific raise by performance criteria
• Signing bonus
• Performance bonus
• Guaranteed bonus
• Car or car allowance
• Health insurance options
• Cobra payments
• Vacation
• Cell phone
• Laptop
• Company credit card
• Club memberships
• Stock options
• Equity
• Relocation expenses
o Physical moving costs
o Temporary living expenses
o House hunting trips
o Trips between old and new locations
o Real estate transaction costs
o Low interest loans
o Lump-sum relocation allowance.

Here are examples of statements to make to the employer when negotiating.

• I would like to join your organization because this is an outstanding growth opportunity. Money also is important, however, and I would like to ensure that I am being paid a salary in a competitive range.
• I am a top performer in my field and plan to prove to you that I am worth the top of your ideal salary range.
• I am confident in my ability to perform at a high level and would welcome a performance-based incentive bonus in lieu of a higher salary.
• I am looking closely at the overall compensation package. If you cannot meet my salary request, I would consider a sign-on bonus or a raise in six months based upon performance.
• I think it would be fair to be paid a higher salary in accordance with the greater responsibility and travel in this role.
• I am currently earning a salary in the mid-90s plus 10% bonus and am looking for significant financial incentive to make a move.
• I am currently underpaid as a sales manager at $130,000 with no bonus and think it would be appropriate to receive an above-average salary increase.
• Through my research, I have learned that similar positions in the industry are paying $125,000-$150,000. You will receive every penny of value if I am paid at the top of that range.
• I have earned four weeks of vacation through my 20 years of work experience and would like to receive that amount with your organization.
• Since your company is not offering relocation assistance beyond physical moving expenses, please consider a lump-sum bonus to alleviate the many costs associated with this important move for my family. I would agree to pay this money back if I voluntarily leave your organization within one year.

I have heard many times that you are never as valuable to your employer as the day you are hired. Use the leverage of your experience, track record and industry reputation to negotiate the best possible salary and benefits package from day one. This will establish a strong foundation for you to build on from year to year.

Ken Pelczarski is owner and founder of Pelichem Associates, a Chicago-based search firm established in 1985 and specializing in the lubricants industry. You can reach Ken at (630) 960-1940 or at pelichem@aol.com.