How do you negotiate salary?

In My Humble Opinion
1

I’m looking for a new job. I haven’t had an appreciable raise since 1996 when I was hired as a webmaster. I’m now performing senior level IT duties, being paid 25% less than I’d be paid in the private sector.

A wrinkle came up when researching a place I’ve applied for. My friend works for the other half of the company (they split products, went their seperate ways, but still had the same institutional culture). His frustration was: He couldn’t hire someone at an advertised rate if it were greater than a certain percentage of what they’re making now.

So…lets say there’s an interview and they say ‘What are you making now?’ Is it safe to say ‘I’ve been underpaid for a very long time, I’m changing jobs to correct that and I’d rather be paid what I’m worth, rather than be penalized for my previous job.’

In this whole job hiring dance, can you refuse to disclose your previous salary?

2

You could always lie about your current salary. HR departments are only permitted to disclose basic facts about your employment dates if prompted, in my experience.

3

If you lie, and it comes out somehow, it’s usually an instant no-hire or instant fire. At least at some corporations.

Honestly, the “I can’t get you that salary because you didn’t make enough at your last job” sounds like BS to me. If they really wanted you, they would cut the red tape and give you an offer commensurate with your skills.

4

Since you’re looking for advice, I’ll move this to our advice forum, IMHO (from MPSIMS).

5

My current employer is not known as a paymaster. That is the reason I am looking for a change.

6

Lieing is a non-starter, the job requires ethics above reproach. (security related)

7

One rule of thumb is he (or she) who discusses salary first, loses. When I last changed jobs, I would have been happy with a 3% or 4% raise. They offered me a 12% raise! I’m glad that I kept my mouth shut.

I would never recommend lying during an interview. Refusing to disclose may also keep you from getting the job. Your idea of saying your current low pay is why you are looking for a job is a good one.

You could be coy and when they ask, say something like "Tell me what you are offering and I’ll tell you if it’s more, less, or about the same as what I’m making now.

Of course they often ask this question before the interview on the application. Leaving this blank or putting something like “less than market rates” is OK in my book.

Also look at the total compensation package. I’ve seen some with a great salary, until you factor in things like your part of the health care costs.

8

There is plenty of information on Salary.com, Payscale, Glassdoor, Vault, the Ladders, Careerbuilder, Monster, Indeed, assorted industry or school surveys and other information that you should be able to get a pretty good idea of what you should realistically make.

First of all, understand that HR departments at any respectable company already have a pretty good idea of what they are going to pay you. They have hundreds or thousands of data points (ie their employees) and probably pre-set bands for your level and position. So trying to be coy and pretend like you are making 50% more than the industry average probably won’t work. Not is it likely the company has an extra 50% they are leaving on the table in hopes to lowball you.
Which is not to say you don’t have any leverage. Economy or not, it’s still very difficult to hire good people. I think you are better off just having a frank discussion. “I make x if you must know” (and unless you are willing to stop the interview process or make it weird, they will eventually get you to tell them). “Based on other interviews, my experience, skills, and independent research, I am looking to make y. Is that a number we can discuss?”

9

I encounter this kind of explanation quite often with friends and I always take the position that it’s convenient BS, that if they really wanted you they’d make the arrangements.

When I give that advice I’m often told I don`t know what I’m talking about, that it’s serious at their company, no exceptions. Then it never gets tested, because it’s the real world and I can’t force my friends to take my advice.

However, I’ve personally always gone through life assuming that rules like that are just obstacles to be circumvented and it’s worked great.

10

Don’t lie. Your self respect should be more than that.

Instead, figure out what you want to be paid. Then tell then. If they can’t pay it walk away and live with it. Otherwise you’re just building your own stress level.

He’ll, I just did that today with an offer of freelance work. They offered one thing, I said I needed double and they did it.

11

If there is a form that asks for previous salary, then I answer it honestly, but it does not affect what I want and will ask for. That amount is usually 10% more, assuming I am still employed. If I am unemployed, then depending on the length of time and the state of affairs in my industry, I have generally gone for the same salary.

If they try to negotiate down from the salary I want, I try to get them to give up something else, like extra vacation/PTO time to a point.

That said, everything is relative. For example, in my industry, people job hop a lot. The company I am at now pays a good wage, but not the highest in the industry. The difference is, most people here are fiercely loyal to the company and have been here for 10+ years, and some have been here 30+ which is unheard of. The reason is that the company really makes an extra effort to treat employees well, does lots of free lunches and other minor perks, and will make every effort to move people to a new project rather than dropping them like a leaking bag of dogshit if one loses funding. I really respect that and plan to stay here a long time. If they had offered me the same or even a little less money when I was negotiating (and I was only employed part time when I took this job), I would have still accepted it, because the stability of the company and their treatment of the employees has additional value to me.

12

I’m with that. Figure out what you think your skills and experience are worth, factor in what the employer can afford to pay, and take it or leave it.

My current job started at $20k less that my previous job. No big deal, I’d spent 12 months barely working, by choice. 5 years later I’m on $50k more than I started on, without ever asking for a pay rise.

13

The policy doesn’t even make sense. An employee’s former salary has zilch-all to do with their value to you.

Do we know for a definite, certified and verified fact that companies actually do have policies like this? Or is it an “I heard that someone heard” thing? Because it sounds just like a job-searcher’s paranoid fantasy to me.

14

It really is policy for many companies. I doubt it would be a hard and fast rule anywhere though. For most jobs in the world a business wants to hire someone who can do the job for the least amount of money possible. If someone has a job where they are getting paid, the business can estimate the capabilities of the prospective employee based on their job, and knows how much someone else thinks he is worth based on their salary. They don’t want to pay him any more than that unless there’s a justification, such as a newly acquired degree or certification for example. Or if supply and demand isn’t favoring the company. It’s very difficult to determine how valuable any employee is to a company, and it’s generally good business to avoid being overly dependent on any one employee. So unless a critical position needs to be filled a business has no incentive to pay a prospective employee more than he is currently making, and preferably even less.

None of that means a company will act against their own interests and pay someone an amount too low to get the productivity they were looking for. But it’s hard to get past the idea that people have a value as a commodity, and you don’t want to pay someone more than he was valued in the marketplace.

15

I’ve seen in in two locations…anecdotally from HP and our State government caps salary increases at, like, 12% of your current salary if you’re staying in the system. (Say, going from a phone bank position at Health to a Manager position in Wildlife.)

16

I had my current employer try and pull this on me when I was negotiating my salary. “But we are already paying you X more than your last job!” “Yes, and I don’t do that job anymore, I do an entirely different job, for an entirely different company.”

Apparently they had never thought of it that way before.

17

Your salary is commercially confidential.

18

At my current company we definitely ask the previous employer to confirm three data points: start date, current/final title and salary. This is after the offer has been extended and accepted, pending background check (and sometimes credit check, for senior positions). If it doesn’t match, the offer is withdrawn unless there is a good explanation. It happened to me when I was hired. For some reason my previous employer gave me a car allowance and housing allowance, which I included in my salary. I didn’t need to have any special housing or use my car for business. They just paid like 60k salary, 10k car allowance and 15k housing allowance. I reported the salary as 85k. When my current company’s background check contractor called to confirm they verified salary as 60k. I showed them a paystub and all was well.

19

What does this mean?

20

I think the most common mistake is to misunderstand just when the salary negotiation should, and does, take place, and the role your current salary plays in the salary offer that will come later.

As a result the candidate often feels defensive and says, “I made $45K but I was there 10 years and there were people hired after me and they made $X, and I felt that I was taken for granted as a long term employee…”

But you’re beginning an oblique argument for your salary, 1) prematurely, 2) from a defensive posture, and 3) before you’ve had an opportunity to make a case why you are the perfect candidate.

Answer the question forthrightly, honestly, and with confidence; and proceed with the interview, understanding that A) the salary offer will come later, (and the negotiations) and B) your current salary is one part of their strategy. (the others being supply and demand for that position, and therefore what the market going rate is)

Your job then, is to wow them so that your current salary is less of a bargaining chip for them. Make them want you.

Your second job is to be really well informed. Know what the market rate is for the job, using credible cites. Make a case why you were underpaid,* (only if it comes up!) *professionally and without sounding like you were disenfranchised by your pay. Certainly don’t make it look like you’re primarily motivated by pay. You don’t want them to see you as a job hopping hired gun.

The question as to your current pay will be early in the interview when you are at your *weakest. * Answer the question and move on. Start the discussion at the appropriate time; at the end of the interview, when you’re in the *strongest *position you’ll be in.

Employers aren’t stupid. They know the appropriate salary ranges for certain levels of performance. If you’ve made your case in the interview, and made your case during salary negotiations, they’re not going to let a good candidate get away, even if means doubling your salary.