Estimated reading time: 4 mins
One of the most frustrating aspects of earning a living is when we are not earning to our potential.
Particularly so when we hear about the vast sums paid to people we could eat for breakfast. What do these guys do that we don’t?
I can tell you what they do. Because I recruit people like them.
First, establish what you’re worth ‘on paper’
Take a look at salary research and benchmarking websites such as PayScale.com or Salary.com, and you’ll get a good idea of what people in the same role as you within your area are earning – this is your Benchmark Rate.
Compare this to your current salary. Don’t forget to include bonuses or any other allowances you receive.
Validate that you are in a Position of Strength to negotiate from
Bit more tricky, but it’s the important bit. Ask yourself these questions:
- Is my current salary below my Benchmark Rate? – can you prove that you’re not being paid what you’re worth?
- Am I in a unique position? – is there only one of me who performs this role and is this role essential to the success of my employer?
- Do I possess unique skills that help me do my job better? – that cannot be easily replaced?
- Do I have unique relationships that help me do my job better? – influence and connections based on trust and respect that others don’t have?
- Am I more efficient than my peers? – do I get things done at a pace that my co-workers can compete with?
- Am I more flexible than my peers? – do I have a track-record of adaptability of flexing to the changing needs of your employer above and beyond the duties of my role?
- Do I do what I say I will do? – do you deliver on your promises and have a track-record of persistent delivery against your objectives?
Answer Yes to these questions and you are in a genuine Position of Strength to bargain from. Write these down as your justification for a pay increase.
Salary Negotiation – what you need to know
There are 3 things I want you to understand:
- Most employers must pay market-rates because they have to reduce employee attrition to acceptable levels (i.e. they have to pay enough to prevent too many employees leaving)
- Most employers will pay attractive rates to employees they want to recruit away from their competitors (i.e. they have to pay more than their competitors to recruit and retain top talent)
- Most employers have stakeholders that want to make profit. An over-inflated salary is not in their interest because it results in less profit (i.e. they won’t pay too much)
How to Negotiate
You have already established that you are in a Position of Strength. Therefore, not only do you deserve to be paid what you’re worth, you’re also able to prove it.
Now is the time to talk to your manager and HR department, and make a case for an increase in salary.
- Request a meeting about your salary. Your first goal is to get face-to-face with people who will have influence over your salary. Request a meeting with your manager and HR. Do not say what salary amount you’re asking for yet.
- Say you want an increase, but not by how much. Your goal is to get your employer to say the number first. At this point. you can share your justification for an increase, but don’t give a number, and don’t share your salary research data. Don’t give in. If they’re evasive, keep asking.
- When you get an offer – say nothing. Repeat the number, and say nothing else. Let silence fill the room. Show no emotion, if you can. This technique puts pressure on your employer and they may even come back with a higher offer. If it’s not what you’re worth, then say No, and give a counter-offer (your target salary based on your salary research data PLUS 5% – 10%, to allow being negotiated downward.)
- Clinch the deal—but don’t stop. When you get the offer you’re looking for, then accept it but don’t close the negotiation yet. This is an ideal time to ask for other benefits. You won’t get a better time to do this again. Say you’ll sign your acceptance today if you can get the additional benefits thrown in.
If you’re doubtful about your own performance in the negotiation, don’t worry, this is not an easy thing for most people to do. Practice the negotiation with a close ally or in the mirror. Perfect the steely gaze you’ll need so that silence becomes your friend. Building on your negotiation skills will benefit it throughout your life, so it’s well worth taking this opportunity to do so. Like a Pro.
Did it work for you, or do you have a better negotiation tactic to share?
Please share your story by leaving a comment below, or starting a discussion in my forum.