Salary negotiation is something that everyone should be focussed on.
No matter when the last time you negotiated for a better salary was, the time will come again when the value of the work you do is not reflected in the compensation you receive for that work.
When this time comes, it’s important to approach the issue objectively, build an evidence-based case for your desired salary and negotiate for it.
This guide will cover the basics of salary negotiations, how to find out your objective value from job market data, best practises, how to negotiate a pay rise and what you should do afterwards.
What Are Salary Negotiations?
Salary negotiations are discussions between yourself and a representative of your current or prospective company that aim to help you secure a higher salary.
It doesn’t matter if you’re a long-time employee or a new hire — if you believe that your salary isn’t enough, you should feel empowered to negotiate in order to get what you deserve.
When you decide that you want to negotiate for a better salary, be prepared to:
- Build your case: You will need to prove that you are worth investing in, with specific examples of the value you’ve provided to your employer throughout your tenure there.
- Face some resistance: Even air-tight cases for a salary increase can elicit skepticism, so be prepared to answer questions, especially, “Why do you deserve this salary?”
- Strike a Balance Between Firm and Flexible: Your salary negotiations won’t go well if you refuse to give any ground or say “yes” to a minimal salary increase. Be prepared to go back-and-forth during negotiations and be sure that any compromise reached is acceptable.
Why It's Important to Negotiate Your Salary
It’s important to understand that negotiating your salary is a perfectly normal part of the employment process and that getting the salary you deserve is part of advancing in your career.
Your salary is more than a deposit to your bank account — it’s how your company shows you that they appreciate your work and value you and your skills.
Your salary is also how your company supports your work-life balance, with career development, work flexibility and health-related perks.
Negotiating for some of these perks will help you to get the complete salary and benefits package you need:
- University Tuition Reimbursement: University tuition is only getting more expensive, and negotiating for tuition reimbursement is highly appealing for people who want to continue their education.
- Training, Professional Development & Certifications: Not every company offers effective professional development and/or certification programs, but career-minded professionals should be sure to negotiate for professional development resources.
- Mentoring & Coaching: This perk is nearly priceless because it can lead to both professional growth and growth of interpersonal relationships with talented leaders in the company.
- Childcare: The costs and time requirements of childcare add up quickly, and negotiating for childcare is a great way for parents to secure a better working arrangement.
- Health + Fitness: Negotiating for health and fitness benefits (such as wellness stipends, gym memberships, etc.) can add value to your bottom line.
- Flexibility: Being able to work from home, work while travelling or work on a different schedule can be more attractive to some people than a higher salary.
While dollar signs definitely matter when negotiating your salary, these are forms of compensation that should be considered before taking a new offer or re-signing on a dotted line.
How to Find Out What You're Worth
Before you go into a salary negotiation, it’s crucial that you find out, objectively, how much someone in your position, with your experience and in your location, should be paid.
Salaries range greatly by industry, seniority and geography, and getting the salary you want will depend on asking for a realistic compensation package.
Define Your Range and Do Online Research
First, you need to find out what people in your position, with your level of experience, are making in your area.
To get a sense of what the average salary is for your job title, a simple search on Glassdoor’s salaries tool will give you baseline information.
Know Your Salary
After researching the compensation range for the job, the next step is comparing the average compensation with your market worth. Using Glassdoor’s Salaries page, look up the average salaries for your title and location — the results you will see are based on what others in your field are being paid. You'll also see available job listings for those titles.
Once you have a general sense of your market worth, you’ll be able to compare that with what the average salary for the position you’re vying for is.
Salary Negotiation Tips
Salary negotiation doesn’t have to feel uncertain or intimidating.
As long as you’ve done research to learn a realistic salary range to ask for and have a plan in place for navigating the negotiation, there’s nothing to worry about.
Following these tips will also help you to have effective salary negotiations.
- Have a salary range rather than a single figure: When pressed for your salary requirements, you should always be sure to offer a range based on what others in the field are earning, rather than a single fixed number, says Karen Lawson, founder and president of Lawson Consulting Group, Inc., a US-based management and organisational development consulting firm. Having an acceptable salary range helps you to negotiate and find compromise more easily.
- Practice your pitch at least once before the actual negotiation: Find someone to listen to your proposal for a salary increase, so you can feel the cadence of your speaking points out loud in a conversational setting. Much of a successful negotiation boils down to feeling comfortable and well-prepared.
- Be gracious: If you’re at all worried about coming across as demanding or ungrateful, there’s a very simple solution to that: be gracious. No matter the outcome, be understanding, appreciative and thankful for the opportunity.
- Be confident in your delivery: It’s extremely important to put on your game face when the moment comes for negotiation. Bring confidence to the delivery of your pitch and in the negotiations that follow.
- Avoid accepting the first offer: If you need time to evaluate an offer, say so. Schedule your next meeting 24-48 hours out and come back with your counteroffer.
- Understand your leverage: Your negotiating power will vary depending on your current employment situation. For example, if you are unemployed and applying for work, expect to earn approximately what your old salary was or slightly less, says author Don Hurzeler.
Asking these questions will also help during salary negotiations for a new or current job:
- “Can I negotiate this offer?” Make sure to start off by asking if the offer is negotiable in the first place.
- “Besides the base pay, what other benefits are negotiable?” This can include stipends for tuition and training, paid leave, holiday time, moving expenses and pensions, just to name a few.
- “How did you calculate this number?” By asking this question, you’ll be able to see if the number you’re being offered is a hard cap or a potential springboard for negotiation.
- “What’s the outlook for salary rises or promotions?” Whether or not your salary offer is negotiable at the moment it's offered to you, it’s important to know what the future potential is for a pay rise or promotion.
- “What metrics do you use to evaluate the success of employees?” This is an important follow-up question to ask in salary negotiations and, if you end up working for the company, this information will help the next time you’re back at the negotiating table.
- “Can I get the salary offer in writing?” Verbally settling a negotiation in your favour is great, but it doesn’t mean anything until it’s on paper.
How to Negotiate a Pay Rise
Even if your manager understands the value you’re adding to your company, it doesn’t mean they’ll proactively offer you a pay rise — you have to prove your case for a pay rise just as surely as you have to prove your case for a higher starting salary at a new job.
Leverage Internal Moves
A new role in your company provides a great negotiation opportunity. If you are considering a promotion or new job with your current employer, don’t buy the argument that management’s hands are tied and pay growth is capped.
Use market data to lay out what it would cost the company to try and hire off the street, and ask for it. You will likely find resistance, but be firm in your stance.
Choose Your Moment
Maybe it has been a while since your last pay increase, but you still need to pick a good time to negotiate for a pay rise if you’re serious about getting it.
A great time to bring up the subject of a pay rise is when you know your manager is impressed with your performance and/or in a good mood.
Be Firm & Persuasive
Confidence and persuasiveness are essential for successfully negotiating a pay rise.
What to Do After a Salary Negotiation
Whether you’ve just negotiated successfully or unsuccessfully, it’s important to already start thinking about the next salary negotiation so you can set yourself up for success.
Your Responsibilities May Increase
If your salary increase also came with a new job title, that’s more of a promotion than a salary negotiation. But even if you still have the same job, your responsibilities still might increase if you were given a pay rise. Since you stepped up and showed your worth, you’ll have to prove you were right about deserving more pay.
Your boss expects more out of you now, whether your higher salary came with changes to your responsibilities or not, and exceeding their increased expectations is important for getting that next pay rise or promotion.
If you didn’t get something in writing, make sure you get a letter or e-mail from your boss with the details of the new role outlining what they expect from you. Most importantly, make sure you know when your job changes — whether it’s immediately, or at the start of the next quarter.
Your Boss May Trust You More
As you go back to work post-negotiation, you might find your boss trusting you more or asking for your input on bigger decisions. Moreover, after they’ve seen the kind of confidence you have and how you view your work performance at the company, they will likely have greater respect for you.
Salary negotiations can be tough and nerve-wracking, but when you have a successful discussion, it sends at least two positive messages to your boss. The first is that you have plans to stick around at the company for a while, which is a good sign to any leader. The second is that you’re someone who is focused on the value of the work that they do and your boss will respect that directness and negotiation prowess.
You’re Not Done Negotiating
After a salary negotiation, it’s important to know that it wasn’t the last. Your job might become harder if you end up taking on new responsibilities, or you might find yourself with a promotion next year.
A lot can happen in the next year or two, so it’s important to consistently make sure that you’re being paid fairly for the amount of work you’re doing.
If you have any more questions about salary negotiations or calculating your salary, here are some related articles we’ve written on salary negotiations and gathering job market data to build your case for a higher salary.