Sunday, July 22, 2007

When Do I Bring Up Salary? Job search question of the week - Page 3

How Do I Address Salary When ...:

There are a number of situations where employers tend to bring up salary expectation/history questions, and there are some great responses for each of these situations:
  1. In the application (written): Some employers with written applications will ask for a salary history or expectations. The candidate isn’t benefited from answering this question so early in the game, as it’s used as both a disqualifier and a later ceiling for a salary negotiation that typically goes downward.

    Suggested answers:
    • For history, mark TBD or To Be Discussed.
    • For expectaions, write in Market Value

  2. In the application (online): Some online applications force an answer, by not allowing an applicant to submit the page without a numerical answer here.
    Suggested answer: $1. This answer allows the candidate to force salary into a discussion, and delay the discussion until value has been built.

  3. During a phone screen: Some employers and recruiters will ask for expected or historical salary information during a phone screen. This is also used as a disqualifyer, and can later come back to haunt a job seekers as the initial ceiling for a salary negotiation. During a phone screen, you haven’t built your value, and you know little about the job (what experience you’ll pick up, benefits, vacation, retirement plans, etc.) that could have a big influence on what salary you’d be happy with.

    Suggested answers:
    • Salary History: “I’m not comfortable disclosing personal information at this time. I’m happy to discuss salary when I know more about the position and company.”
    • Salary Expectation: “I’d like to learn more about the position before discussing salary. I’m sure you offer a competitive salary with the market.” Make sure you know what competitive market salaries are in your location.

  4. During a first interview (either HR or hiring manager): “I’m happy to discuss details when we are ready to consider a job offer.” or “Isn’t it a little premature to discuss salaries?” Make sure you know what competitive market salaries are in your location.

  5. During a second or later interview: Now you’ve presented your value proposition - the employer is either making decisions between finalists or starting a negotiation. It’s important to determine if the employer truely sees you as the #1 candidate and is starting a negotiation, or one of the finalists and is doing a price comparison. If you are unsure, ask “are we starting a salary negotiation, or are you still considering other candidates?”

    Suggested answers:
    • Considering other candidates: This means they aren’t ready to negotiate, and are still using salary as a disqualifyer - don’t get sucked in. Replying “Do you offer competitive compensation packages? ( ... wait for answer ) then continue “Great, if you decide to offer me the job, then we’ll be able to figure out a salary that makes both of us happy!”

    • You’re #1: Now the employer is ready to negotiate. By asking what your expectations are they are asking you to make the first move, which is not in your best interest. What if your expectations are 10% less than the bottom of their salary range? What if you had a below market salary in your last job, but had benefits that made the entire package above market (6 weeks vacation, no cost medical, 401K match to 20% of your salary, 20% profit sharing, 100% reimbursement for degree, free child care at work, being able to walk to work)? In a negotiation, the person who moves first is at a disadvantage - don’t fall into this trap.

      Instead, answer “I’m sure your compensation package will be competitive - What is the salary range for this position?” Again, make sure you have researched comparable salaries for the position, industry and geography. Cost of living can make a huge difference in some cities, potentially making a higher salary package less desirable than an offer in a location with lower expenses.

      This answer puts the question back to the employer, politely asking them to make the first move. Do your research first, and expect that a typical salary range is plus or minus 10%. The high end of the range is typically used for employees who have done well on the job for a few years at that company. If you’re making a lateral move to a smaller company, have hard to find skills, or unique industry information, aim for midpoint plus 5% - a new employee isn’t likely to get much higher.
Avoid asking for the highest point on the salary range - hiring mangers rarely move that far as it limits the raise they can afford to give in year #2 (who wants a wildly successful employee who they can’t afford to keep happy - that employee is likely to feel under appreciated and look elsewhere).

Attempting to go above the range? This may not be your best choice - hiring mangers typically need executive (or owner) level approval to go offer above a salary range, and typically need to have future raises specially approved if they contunue above a salary range. Do you want a job where it’s easy for your boss to give you future raises ... or a job where that’s difficult?

Where To Find Competitive Salary Information:

Just remember - it’s not in your best interest to bring up or answer salary questions early on. The employer who wants you to work for them will be willing to wait for salary answers, and you’ll probably earn some early respect. Delaying the salary discussion allows a candidate to build more value and to create the impression of candidate scarcity (humans really want what we aren’t sure we can have) so the candidate appears to be a more desirable employee - worth a higher salary.

Readers - what tips do you have about when to bring up salary, and salary negotiations? Please share your stories in comments below.

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