8 TIPS FOR NEGOTIATING A SALARY

8 TIPS FOR NEGOTIATING A SALARY

By Richard Pheasant

 

Nearly twenty years ago I received an offer of a job at a brand new oil and gas engineering university at a major city in the Arabian Gulf. The job was exciting, as it was a brand new project connected with a famous university in the United States. The offer was also a good one and, although the salary was a little low on average, the benefits were very good, the facilities excellent, and it gave me a chance to stay in a place where we were already based. It was very much a God-given opportunity, so I accepted immediately. 

 

The team of lecturers and professors who had been assembled were mostly a mix of Americans and Brits, and the majority of us got on very well. Over a period of time, people got to learn about each other’s salaries and benefits and, what was interesting, was that on average the Americans were on sizable higher salaries than the Brits. As some of us discussed this, it became evident that the American contingent had mostly negotiated their salaries, while the majority of the Brits had waited and accepted the offer they had been given. Negotiating salaries was something that many of us were just not used to. 

 

Move forward twenty years and there is much more awareness in the UK of the importance of negotiating a salary, and so here are eight tips to help you either in your current job or mostly for when you are interviewed for another: 

 

1. Do your research and have a salary figure in mind.

 

To start with, download some salary guides, such as this one https://www.roberthalf.co.uk/salary-guide and get a feel for the average salary for the position you are applying for. Secondly, look up the company you are interviewing with and see how they performed over the last year. Many companies publish their annual financial performance on their webpage. You can also find information on the Companies House website as well. 

 

Then, look up employee reviews on websites such as Glassdoor (https://www.glassdoor.co.uk/Reviews/index.htm). This should give you a better idea of the company, how it is performing and whether they would be open to improving a salary offer. Once you know the average salary for your position, a rule of thumb would be not to ask for more than 5 -15% above the average, as long as the company is performing well.

 

If it is a specialised job, or you feel you would be in a strong position because of your knowledge, skills and experience, you may feel you can ask for more. Either way, you do not want to place yourself outside of what we call the ZOPA (The Zone Of Potential Agreement.) Too high and they may not be prepared to offer you the job. That is why within the 10-15% above average is probably a good place to be. 

 

If you are not yet employed and you need a job, you do not have much room for negotiation, so be careful here. I would not ask for more than 5-10% above the average. Or if you really need that job to start paying bills, then just stick with the average. Employers will often ask you your salary expectations, so always be ready with a figure in mind. 

 

2. If you are employed, be clear in your mind on your reasons for leaving and wanting a new employer. If you are happy, why not negotiate with your current employer first?

 

Many people leave a job they enjoy for another one because it offers the opportunity for a higher salary – and then they end up regretting it. I coached or trained several people over the years who have shared exactly this with me about themselves or a former colleague. They enjoyed their job, liked their manager, got on with colleagues and were generally happy. However, they saw an advert for a job and just applied, or were invited by a former colleague to do so, and before they knew it they had accepted the offer of a better salary and resigned from their current job. Only to find they did not like the new job, the manager, the new culture or the department atmosphere. 

 

I also know people who, after accepting a job offer and resigning, are offered a significant increase to stay by their company and now find themselves in a stressful position of whether to stay and cancel with the new company, or take up the new position.  So, be clear in your mind on your reasons for leaving.

 

If you generally enjoy your job and are happy in the company, you feel you are still developing and you get on with your manager and colleagues, then why not start off by meeting your boss and see if you can negotiate a higher salary in your present position.

 

Again, you should still be prepared for that meeting. What salary increase will you be looking for? It should be along the lines of what you would want in your new job, so check average salaries. You should know how your company is performing, but if you don’t, find out. If your company has been making people redundant, it is very doubtful you will get anywhere and you will be told to be thankful you have a job. Do your homework.

 

Secondly, have the evidence ready for why they should give you a salary increase. If in your performance reviews you have only been ‘meeting expectations’, then start performing above expectations before you ask. Do more, take on more jobs and achieve higher targets. Only if you are above or far exceeding expectations, in other words at the highest or second highest rated performance appraisal rating, might you be considered for a salary rise. So get working. 

 

If you are above or exceeding expectations, make some notes on your achievements and what you have been able to do to reach your goals and get results for the department or company. In other words, show them you are worth it. You never know, instead of a salary-rise, they may look to give you a promotion. When you are ready, ask for a meeting with your manager to discuss it. If you get an increase, you can be satisfied. If not, then at least they will not be surprised if they then receive your resignation when you get a new job.

 

Some people get a job offer and then use it as leverage for a salary increase. Be careful of doing this. Yes, it may show you are quite hard-nosed at negotiating, but it leaves a bad taste and smacks of a lack of integrity. When things go pear-shaped, or you yourself have a bad year, you may find you are on the top of the list for a redundancy. Negotiating is about achieving a win:win for all sides and this would feel like a loss to your manager, so be careful. 

 

Finally, if you are not happy in your job, what are the reasons? Your manager, your colleagues, the job itself, you are not being developed, no career prospects? Think through whether any of this can be changed and perhaps have a chat with your manager (unless they are the problem, which they often are. As the saying goes, ‘people leave managers, not companies’.) If not your manager, then talk to someone in HR. Can anything be changed to make you happy and satisfied to stay? If not, then apply for those jobs. 

 

The grass will not always be greener somewhere else, so be clear in your mind that you are leaving your organisation for the right reasons. 

 

3. In your salary negotiation, be first to let them know your expected salary.

 

Some people might disagree with this, but I am basing it on the fact that you have done your research, you know average salaries, and you are clear on what you are worth and what you would be happy to accept. 

 

I suggest sharing your figure first because it is one of the golden rules in the art of negotiation. It is called ‘Dropping the Anchor’ and I always coach and train people to do this when they are negotiating.

 

The logic behind the rule is that, once you or the other party state a figure, it then becomes the main reference point and you or they ‘control’ the anchor.

 

If in the interview they state their offer first, it could be lower than even the average and yours may now sound way to high. On the other hand, by stating yours first, this becomes the reference point and they will have to think about theirs and whether they can make it nearer yours. Either way, research shows that the party who begins the negotiation will achieve a final agreement that is closer to their own expectations. 

 

Yes, you will need to be bold and your will definitely need to feel that the interview has gone well and that they appear to like and want you.

 

I have seen several writers who suggest waiting until the company makes their offer to you and after that begin to negotiate. As mentioned though, their figure now becomes the reference point, which is not what you want. Also, what do you do if you wait to receive the email congratulating you on getting the job, which then also includes the salary offer? You do not want to be negotiating by email or on the telephone (face-to-face negotiation always works best, as it is more communication rich), and you do not really want to send an email accepting the position on condition of a salary increase, which may leave a bad taste. 

 

If you unsure on how the interview has gone, then perhaps adjust your figure down a little. The best thing to do is to ensure you have a plan in how you will approach this and the salary you will ask for, depending on how the interview has gone (which could mean having several figures in mind.) 

 

But what if they do not mention the salary, nor ask you for your expectations?

 

4. If they do not ask your salary expectations, wait until they ask if you have any more questions.

 

I have seen some HR managers on Linked In saying that they are put off a candidate when their first question is “What would be my salary?” So, to avoid this, think of a couple of other possible questions you could ask first, such as:

 

• “Are there many opportunities here to be developed in order to improve my competencies and career prospects?”
•  (If applicable) “If I am selected, which location would I be based?”

 

Or another one you think maybe relevant. Then ask the salary question. If they ask you your salary expectations first and you feel the interview has gone well, state it and see what they say.  They may leave it at that, or they might give you a figure that they have in mind. If it is lower than expected, ask if it is negotiable, as well as saying something positive such as “Is that negotiable, as I am really excited about the job and being able to work for you?”

 

Many times, an interviewer will simply say that they will consider your salary expectations and end the negotiation at that point. It would be best then not to pursue it. If you really want the job, wait until you get it with the salary offered, and if it is lower than expected, seek to prove to them that you have been worth hiring. After 6 months, or more probably a year, when you are doing well and getting positive performance reviews, then make a request for a salary increase. 

 

5. State an exact figure, do not use a range and know your WAP (Walk-Away Point).

 

When you state your salary expectation, make sure you do not give a range (e.g. from £35,000-£40,000). The reference figure for them will always be the lower one, so you should avoid this.

 

Secondly, use an exact figure with more numbers than ‘0’s’ , such as £39,500 or £38,750.  Research suggests that when you state an exact figure, it demonstrates that you have done your homework in terms of your market value and that you are more likely to get nearer what you are asking for. 

 

Thirdly, know your WAP, your Walk-Away Point. This is the case when their salary suggestion or offer is so low, it is not worth negotiating. Once you know the average salary for your position, what you are worth, as well as what you want for your own needs or what will make you feel good, this should give you a good idea of what you would be prepared to accept as an offer.

 

So, as well as having the salary you would like in your mind, you should also have a figure that is simply unacceptable to you. This is different if you are working, as it would usually be one that is lower than your current salary (unless there are other reasons to attract you to the job and organisation.) If you are not working, what would be the lowest you would accept? Either way, if you are not happy, whether the offer is at interview or in a letter, always come back first with the question of whether the salary is still negotiable before deciding to ‘walk-away’.

 

As mentioned before, if you really want the job or to work for the company, the other option is to accept their offer, work hard, get some excellent performance reviews, then ask for the salary increase. Otherwise, one more option is this…

 

6. Think benefits, not just salary.

 

In negotiation, other benefits that might be included besides money are called ‘variables’. In this case, what else might they offer alongside the salary? (As a candidate, it is doubtful that you have any other ‘variables’ to offer, although you might be qualified in another useful area, e.g. health and safety, counselling, first-aid etc., but these are likely to be included on your CV.) 

 

In terms of the organisation’s ‘variables’ these could be other benefits that you might ask about, such as health insurance, travel allowances, gym membership? See if there is anything else that you might negotiate that would attract you to accept the job. 

 

However, before asking about other benefits, see how the interview is going and do read the body language and tone in the communication from your interviewers. 

 

7. Read the body language and tone of the communication in the interview.

 

You should be able to get some idea of how well the interview is going through the body language and tone of the interviewer/s. The better it is going and the more you get on, the bolder you can be in negotiating your salary or asking about other benefits.

 

If you have answered their questions well and feel good about how you have communicated, then this should also give you confidence in being a little braver in your negotiation. If not, then perhaps keep the discussion only on salary and yours and theirs expectations. 

 

8. Finally, stay assertive and keep your emotions calm

 

In negotiating, I always tell coachees or trainees that it is best to leave your emotions at the meeting-room door before you enter. That, of course, is easier said than done for interviews, when you are generally nervous beforehand. Yet, you will come across much better and you will be more assertive if you can manage your emotions better before and during the interview. Pick up on some techniques for managing your emotions in these situations.

 

For example, Steve Peters in his book “The Chimp Paradox”, gives a good technique for doing this, based around feeding your mind positive thoughts before the situation, you are facing, in this case your job-interview (there is, of course, so much more on this and how to manage you emotions better that is covered in the book.)

 

Otherwise, find other books or articles on the web that will help you in managing emotions better. You could simply start by telling yourself over and over, before the interview, to always stay calm and be firm and assertive throughout it.

 

Recently, I read an article that said that interviewers are trying some tricks to ‘test’ candidates. This includes techniques such as offering a cup of coffee and seeing if you take it out and wash it up after the interview (seriously!) Or dropping their pen to see if you pick it up, or even starting the interview by speaking loudly, shouting, or being weird to see how you handle it.

 

My view of this is, why don’t they just put on a clown costume, give you a vacuum cleaner and ask what you would like to do now! These are tricks and no interviewer, in my mind, should resort to these ways in order to test candidates (there are plenty of relevant questioning techniques and personality tests that are much more professional), but be prepared for this kind of thing to happen now.

 

So, tell yourself beforehand to stay calm, be assertive, answer questions professionally and show you are worth it.  This will give you the best state to be in, in order to participate in the interview, answer their questions and then negotiate your salary.

 

The key principle in this is to know what you are worth and being aware, as much as possible, of what the employer is able to offer you. This means excellent preparation and planning, which incidentally research says is the number one competency of a successful negotiator. All the best to you in putting these tips into practice.