Salary Negotiation Guide

Negotiating Salary

Negotiating salary (when possible) is an art that is paramount for your career development and future trajectory. A poll conducted by Robert Half, a Global Staffing Firm found that only 39% of the population negotiated for a higher salary in their latest job offer (46% men vs. 34% women). Many people skip negotiation as it can feel uncomfortable; however, much like interviewing or writing a cover letter, it’s a muscle that will only improve with practice. Here are a few reasons we urge you to practice negotiating.

  • Every opportunity to negotiate will impact not only your current financial well-being, but your long-term pay as well. If you settle for $5,000 less per year than you could negotiate, then over a ten year period—with raises, bonuses, and interest—you could lose over $100,000. Your current salary typically follows you to your next job.
  • Negotiating salary shows your employer that you are confident in your abilities and know your worth.

In this guide, we will walk through how to:

  1. Research your market value.
  2. Identify your non-negotiables.
  3. Answer “what are your salary requirements?” and other difficult screening questions.
  4. Evaluate an offer.
  5. Prepare for a negotiation conversation

TIP: Use our Salary Negotiation Workshop Guide to keep track of your research and ideal offer package.

Preparing for Salary Negotiation Conversations

Identify Your Career Values and Non-Negotiables

When you finally have an offer after months of hard work, it’s easy to get swept up and consider accepting on the spot. This is why we recommend taking time to evaluate what you need in your next role well before negotiating to ensure that you feel fulfilled and actively work toward achieving your career goals.

As you prepare to evaluate an offer and negotiate your ideal outcome, take a moment to think about what you’re specifically looking for in your next career move.

Optional Activity: Reflect on the following questions to get your juices flowing about your career values  and how this next role fits into your broader career plan.

  • What is most important to you?
  • Where are you in your life right now and where do you want to be in the future?
  • What core needs does this job need to meet? Job security? Flexibility? Working on a collaborative team? Pay?
  • Why are you leaving your current role? What do you need in your next role to be more fulfilled?
  • What motivates you?
  • What environments are best for you?

Additionally, identify your non-negotiables and trade-offs to identify how well an offer suits your needs and wants. What aspects of the job are non-negotiable?

Know Your Market Value

Knowing your market value up front will put you in a powerful position when it’s time to negotiate later in the process. We recommend conducting this research during the application/ interview process so you’re ready for any salary-related questions that may come up before you have an offer in hand. Failing to research ahead of time can lead to asking for too little or demanding too much – both can hurt you in the negotiation process.

To identify your market value, consult online tools using the following three points:

  • Industry
  • Job title
  • Location

Recommended Resources to Research Compensation:

  • Bureau of Labor Statistics (BLS) – The U.S. Bureau of Labor Statistics can share the annual mean wage for over 800 occupations. While this is aggregated across the United States and may not be tailored to your location, it’s a helpful place to start and can serve as one key data point.
  • Glassdoor.com: Glassdoor has two key features which can help you assess your worth. First, Glassdoor’s Know Your Worth tool provides a personalized calculator based on your location, title, and years of experience. Additionally, you may be able to access company-specific data by using Glassdoor’s search tool to find salary information. Glassdoor data is populated by current and former employees; therefore, it’s often the best source for organization-specific information.
  • Payscale.com: Payscale’s “What am I Worth?” tool similarly aggregates data from users to provide a personalized estimate of your market value based on location, years of experience, title, etc.

Each of these provides strong data points; however, they will likely not align perfectly with your particular situation. To get a more accurate picture, we recommend validating this research with people in your network who currently or previously serve in positions you seek. The key is to ask questions about the data you find, not how much they make. For example, you may ask “in my research, I found that salary ranges for employees with 5+ years of experience are $XX,000-$XX,000. Does this sound right to you?” While people may feel uncomfortable sharing their salaries, they are typically open to validating if your number is too high or too low.

These steps will help you develop a likely salary range for the position at hand. Once you have done your research, complete the activity below:

Build Your Ideal Salary and Offer Package

Here is a template you can use to get started on researching and developing your ideal salary and offer package. Simply save a copy of the template sheet so you can edit and adapt it.

Salary and Offer Package Guide

Salary Screening Questions

In an ideal world, salary would not be discussed until you have an offer in hand; this is when your negotiation power is highest. But this isn’t always possible as recruiters and hiring managers  increasingly ask about salary expectations in screening interviews, and sometimes, in the application itself. Employers want to know if they can afford you. Providing a number too low may hurt you down the line in the negotiation process, but offering a number too high may price you out of the competition. If you find yourself in either of these positions, consider using the following language to guide you through the interaction:

“What are your salary requirements?”

Until you know the full details of the compensation package (benefits, etc.) don’t suggest a number. Instead, consider sharing where you are in your career and your research.

Sample answers:

  • “I really like what I’ve heard so far and am interested in potentially becoming a member of your team. I would be excited to bring my skills in XYZ. May I ask what range you have in mind?”
  • “I’m excited about the position and look forward to taking a big step forward in my career. I would love to learn more about the specifics of the role before sharing a number”
  • If the recruiter or hiring manager is persistent about a number, consider the following language: “Considering the requirements in the job description and my research, it seems that acceptable salaries for this role range between $XX,000 and $XX,000. I am flexible and willing to negotiate within this range depending on additional benefits and advancement opportunities. Does this meet your expectations?”

“What is your current salary?”

You may encounter a hiring manager who asks for your current salary. They typically do so to help recruiters suss out whether or not they can afford you. If possible, answer the question with a salary range and offer your willingness to negotiate. Here are some sample answers:

  • “I don’t feel comfortable sharing that information at this time. I prefer to focus on the position at hand and the skills I can offer your organization”
  • If you are pressed for a number, be sure to outline the full picture of your benefits and salary compensation.
  • “Currently, I’m making $XX,XXX. In order for me to make a comfortable move, I need to earn $XX,XXX. I hope you agree that the contributions I will make, based on my track record and knowledge of the industry, will justify this salary.”

If you practice your responses and do your research, you will feel more confident and help the recruiter advocate for you by being clear and up front.

Evaluating the Offer and Preparing for Negotiation

What’s in an Offer Letter? 

Keep the full compensation package in mind when evaluating your offer. Companies/organizations will typically offer you some combination of the benefits in the list below. Keep these in mind when developing your negotiation strategy as there are many ways to negotiate beyond base salary.

  • Base pay – total salary and cadence of paychecks.
  • Bonus pay – guaranteed amount with a specific timeline or discretionary based on team or company performance.
  • Paid time off (PTO) – amount of time off you can take fully paid. Clarify whether this needs to be earned over time, or is immediately given upon hire.
  • Fringe benefits – health insurance, retirement savings, life insurance. Most letters will not include this. Ask the employer for additional information.
  • Stock and equity – stock options. What is the vesting schedule? How long do you need to be an employee to be fully vested? What happens if you leave before fully vested?
  • Equity
  • Tuition reimbursement
  • Professional development
  • Sick days
  • Extended maternity or paternity leave
  • Flexible work hours or work from home
  • Remote options
  • Supplies (Computer, internet compensation, gas, money towards public transportation, etc.)
  • Parking
  • Professional development/certifications
  • Start date

Evaluating Your Offer 

Once you have a strong grasp of what’s in your offer letter (and what is not!), it’s time to ask, “Is this job the right fit for me?” Does it align with my non-negotiables? What are the trade-offs? Answer the following questions to do a gut check to think about what is most important to you:

  • Am I being offered fair market value in my base pay?
  • Is the compensation package sufficient for my lifestyle?
  • Do the benefits (health, dental, retirement, etc.) meet my needs?
  • Can I comfortably complete the travel/commute required of me?
  • Will this role help me advance in my career path?
  • Do I like the company/organization culture?
  • Does this role and/or organization align with my career values?
  • Do I like the people I will be working with? Co-workers? Supervisor?
  • Do I feel excited and/or ready to take on the responsibilities of this role day-to-day?

Optional Activity: Still can’t decide? Make a pros and cons list.

There is no right or wrong answer. Everyone’s perception of a job offer differs based on career values, priorities, stage of life, etc. Consider developing a pros and cons list as you think about what’s most important to you in the next three years.

Use the template below to fully evaluate your new job offer:

Package ItemResearch
PAYCHECK
Base Salary 
Your take-home pay
$____
Bonuses 
Potential compensation you can earn based on performance
$____
Salary + Bonus$____
Performance Reviews
Content/purpose of reviews and frequency. Usually includes salary increase and bonus conversations
PERKS AND BENEFITS
Paid Time Off (PTO)
Number of days or weeks a year
Benefits
Examples: Health/vision/dental and paid parental leave
Perks
Examples: meals, snacks, gym (reimbursement), parking (paid and unpaid), game rooms, volunteer time off, professional development (on- and off-site), and nonprofit donation matching
INVESTMENTS
Stock Options
Examples: Employee stock purchase plans and accrued stocks based on tenure
Equity
The percentage of the company you buy into
Retirement
Example: 401(k) options
OTHER
Commute
How many minutes (including traffic)?
Industry
What (if anything) distinguishes this company’s offer from what others in the industry offer?

Develop a Negotiation Strategy

  1. List clarifying questions.
  2. Identify priority elements to negotiate based on your career values.
  3. Know your business case.
  4. Identify your walk-away number.
  5. Practice counter-negotiation.

TIP: Always go into a negotiation with your “walk-away” number. No matter how desperate you are to land a job, you need to be sure it provides what you need to sustain your lifestyle. Identify your “walk-away” number before the conversation and stick to it.

What is negotiable? 

When developing your negotiation strategy, be sure to think beyond base pay. While you certainly want to ask for higher pay (backed with a strong business case), prepare for the possibility that there is no room for negotiation. Often,  salary is tied to a specific budget line item or grant allocation.

Certain aspects of a compensation package are typically more flexible than others, and sometimes they are even more valuable than base pay. Keep the following in mind as you draft your thoughts:

  • Flexible work arrangements (maybe you’re doubling your commute or your salary is lower). Could you work from home one to two days per week?
  • Additional vacation time or flexibility for pre-planned vacations
  • Tuition reimbursement
  • Professional dues
  • Conference attendance
  • A one-time sign-on bonus
  • Relocation assistance. Can you be compensated for moving closer?

Knowing which aspects of an offer are more negotiable than others is important. Use the following model to develop a strong business case for negotiating.

Prepare for Negotiation

You will only get one shot to negotiate your offer so preparation is key! The most effective strategies to confidently communicate your worth are 1) Make a business case 2) Identify your ask and 3) Practice!

  1. Make a Business Case: Confidently convey your value by highlighting your skills, experience, qualifications, and accomplishments. This will support your counter and justify your ask for the hiring manager.

Reflection: What are the top three traits/skills the company/organization is seeking? How do you meet or exceed these requirements?

  1. Develop Your Ask: Identify your range and walk-away number. Then list your three priority benefits in order of importance to negotiate along with salary. For example:
    • Desired range (based on market-value research): $62,000 to $69,000
    • Top three benefits: ability to work from home, paid vacation days, professional development allowance

Can base salary or bonus be increased?

  • “I’m really excited to work here and believe my skill sets apply well to what you’re looking for. I appreciate the $60,000 salary, but I was looking for a position in the $69,000 range. Could we look at a salary of 69,000 for this position? 

TIP: A Columbia Business School study found that use of a precise number (e.g., $109,750 rather than $110,000) is more likely to result in a final offer close to the initial request.

If the employer agrees to your ask, then you’ve got a deal! However, if there isn’t quite enough room in the budget to meet your ask, follow up with additional benefit requests to make up for lost salary. We recommend having three benefits “asks” at the ready. If they don’t accept one, ask about the others:

  • “I understand the best you can do is $64,000 and are unable to come up to $69,000. If you can do $64,000 in addition to [the ability to work from home two days per week/one extra week of paid vacation/professional development allowance], then I would be happy to accept.”

TIP: Silence is golden. A moment of silence can be a powerful negotiating tool as well as a strategy for collecting your thoughts. About 15-30 seconds of silence can help you get what you want.

Do’s and Don’ts of Salary Negotiation

Do

  • Negotiate – the biggest mistake you can make is to not negotiate at all.
  • Make a business case – clearly articulate what you need vs. what you want using facts and data.
  • Know your “walk-away” number –  identify and stick to the lowest compensation you are willing to accept.
  • Be flexible – negotiate other forms of compensation if salary cannot budge.
  • Take the full package into account – pay attention to health benefits, a sign-on bonus, paid vacation time, and alternative work arrangements or schedules. An employer may be open to offering additional perks if they can’t promise a higher salary.

Don’t

  • Fail to prepare – do your homework so you don’t accept a compensation package you are unhappy with in the long term.
  • Focus only on salary – remember to look at the full compensation package.
  • Make it too personal – keep in mind that this is a business conversation. While it’s personal for you, never let it get emotional or bring in personal exceptions (e.g., student debt, etc.).
  • Come across as entitled or inflexible– when an employer makes you an offer, always show gratitude and stay open and flexible to the conversation.

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