Monday, December 8, 2008

Salary Negotiation 101

By Trevor Davide Grant

Once a person asked me if it was okay to talk about their salary history with an employer during an interview. They were concerned about discussing their history because it was a little low and they thought it would have a negative effect on their salary negotiation. They were wondering how they could avoid the topic with the employer until the right time. My rule is to never be dishonest with an employer, however it is a good idea to avoid this topic until you have nearly closed the deal with getting the job.

In the past, I have been in the same situation, and have been pressured for a response to the tough questions on salary. My approach has been as follows.

1) My first response would be to try to defer the topic until later. Because we haven't really gotten through the responsibilities of the job, nor the contributions I can make in the new position. The new job is somewhat different from the past job because the company's market, product or industry are somewhat different than the past companies. Therefore the past salary history is not all that applicable. I would prefer to be paid in accordance with the market and the company's hiring practices.

2) If I am pressured for an answer in an interview where the request is to provide my previous salary, I set out the total value of what I expect the compensation package will hopefully include. That is cash value for the time and effort (salary), list the benefits in as much detail as I can, how much holiday, and other working conditions such as flex time, or time off in place of worked overtime. I also prefer to reiterate that the job I am looking towards is not with the same company and thus my previous earnings not very relevant. In reality, there are so many things to consider, such as home life balance, health benefits, vacations, overtime, etc,etc, that factor in. What is most important to me is that my salary will be aligned within a margin of my past job, and does the package I am offered match what is reasonable for the current job market which can be totally different.

3) While you may feel you are a high performer, you also may be somewhere above average but not commanding the highest pay. Know the salary range for the job you are applying to, but be realistic when setting your percentile level for your salary expectation. The majority of people are between the 25% and 75% level. Remember that the employer will confirm your performance level with your past employers at reference checking time.

4) Regardless of your past salary that you earned in that job role, you should expect to be paid fairly for the current market conditions. You should explain to the new employer that regardless of your past salary, whether it was at or below the market range, you would like to be paid at the salary level that is fair. Your reasons for having a lower than average salary in the past are not pertinent to the new job, and your life situation has changed. Therefore your goal is to have a fair salary negotiation that both sides will be pleased with.

5) Suppose you do reveal your past salary due to the pressure. It is important to do so under the caveat that you expect to be paid fairly, and that you don't feel that the information you are bout to give is all that pertinent. You need to paid an honest salary for your honest work. Just remember to be clear and firm about your expectations, all the while maintaining a level of respect and rapport.

Whatever you to, be completely truthful during interviews. The employer has many ways of getting information and they will find out your true salary history if they are so determined. They will also learn about your past performance, and they may even ask you to produce a pay stub to prove your past salary. Remember you're a highly skilled worker, and you bring a lot of value to the position. You just need the skills to communicate that value clearly and effectively to the new employer. - 16492

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