Congrats, all that hard work and stress has finally paid off and you’ve received the job offer! Now, what? I’m going to assume that you’ve had some inclination of the salary range for the position in which you were interviewing and at some point the company asked your expectations. I’m also always assuming you’re working with legitimate companies. With that being said, you’ve received the job offer and aren’t sure if you should negotiate. Here is my advice to you, always negotiate.
There are some things that are set in stone and can’t be negotiated however, there are some things that can. Typically, you can negotiate vacation time, work from home time, sign on bonus, salary and sometimes annual bonus. Regardless of what you want out of your offer, you need to learn how to negotiate a job offer like a pro and get the salary you demand.
- Accept right away and not negotiate anything and take everything they’ve offered you at that moment.
- Negotiate right away and start listing the items you’d like to change.
- Say thank you, please send this all to me in an email to review and I will get back to you with any questions.
None of these options are wrong or bad, but what I see most, and prefer for myself, is option number 3. Option 3 gives you time to gather your thoughts, do some analysis, and lay out a few scenarios.
Understand ‘Salary Bands’
Upon receiving a job offer, pick it apart starting at base salary. If you received a salary you are extremely happy with then great! If you would like to see an increase on that base salary, then ask for it. I would advise a negotiation of a 10-15% increase in what they are offering. Sometimes there is wiggle room in the budget and they can increase their offer. In larger companies, there is what we call a “salary band”. Every position is graded and placed into a work level or salary level. That level has a predetermined salary range of low-mid-high. Being an external person, you will not have access to this information and no one is going to give it to you. Most people outside of HR don’t have this access or this information either.
If you’re working with a larger company, assume there is a salary band and they have room to negotiate. If you’ve gotten an offer of 75k ask for 82-85k. Don’t give them a range, just the number you are more comfortable with. They will either say they have a hard budget and can’t be flexible, meet your demand, or come to an agreement in the middle. Very rarely will a company just yank an offer and rescind because you’ve countered.
Again, I’m assuming you’re working with legitimate companies here. In my experience, if I had to rescind an offer I’d have to get legal involved, inform the senior most HR people and it’s a hassle and it’s a legal process. It’s not something you can do willy nilly.
Don’t be afraid to negotiate, we expect it to happen.
If you don’t want to shortchange yourself by asking for a specific number, put the ball in their court. Let them know you appreciate the offer and you’re excited to get started but would like to see if there is any room for flexibility. Leave it to them to come back with another number. It is shocking how many people don’t negotiate and are just leaving money on the table.
After salary, let’s look at vacation time. Sometimes this is one that can’t be negotiated at all. Most companies have a set standard like 3 weeks for everyone or the more senior level jobs get more vacation time. It’s one worth asking but I wouldn’t put too much effort into this negotiation. If they can’t budget on vacation time, ask what the flexibility is on working remotely from time to time. This is becoming a near standard for companies to offer so if they don’t offer it up first, ask.
Offset Your Losses
Can’t get that salary to budge? Ask for a sign on bonus. This is also very common. If you’re happy with the base salary and don’t feel the need to negotiate that, ask for a sign on. The best way to ask for a sign on is to offer information on what you will be losing in cash if you walk away from your current company.
Let them know that it’s September and you will be losing 9 months of work that you put toward your annual bonus and won’t be receiving it if you leave. You estimate that bonus to be $x. I don’t mean what you’ll be losing as in 401k, that isn’t their problem. I mean the money you are awarded at the end of the year for doing your job aside from your annual salary.
The conversation can go something like this:
“Thank you for the offer, I am really excited. I do want to ask if there is an opportunity to offset some of the losses I’ll be taking if I leave my position now. As I mentioned earlier, my current salary is 100k with a 10% bonus*. Our bonuses typically pay out at 95% of target so I anticipate a bonus of $9,500 at year end. Can you provide a sign on to offset this loss?”
*Know your legal rights – it is now illegal in 11 states and 9 cities to ask a candidate their current salary or salary history or anything related to their previous and current compensation. These bans were enacted to close the gender wage gap and fight wage discrimination. A company I most recently worked for banned all recruiters from asking the question for all hiring done in North America to keep ourselves out of hot water. They can ask what your EXPECTATIONS are or what you would like to make, but not historical salary information. Check to see if your city/state are part of the ban.