Salary conversations involve lots of competing issues. The hiring executive has a position to fill, yet lives with all sorts of pressures such as compensation precedents already present in the organization, an educated guess of the potential cost-benefits of the individual, competing offers, etc.

The candidate, on the other hand, is juggling issues such as other offers (real or pending), gut feeling about the role and the company, salary insights from the web as well as their own sense of self worth in the marketplace.

There are some glaring mistakes that I’ve seen over 25 years of recruiting which can derail what might otherwise be amicable and successful negotiations. 

Here are some major issues to think about in your next salary discussion:  
From the employer’s standpoint:

  1. Have you taken the time to understand the candidate’s motivations? Have you made it safe for a candidate to let you know where they stand re the role and your company?
  2. Have you been honest about the roles responsibilities and what is the right ‘fit’ for the position? Be honest about what you’re looking for and what it represents to the company and the candidate.
  3. Is the salary and bonus fair market value. If you are underpaying, acknowledge it, but show why you provide something of real value to the individual. Here is a recent Brightlights comp survey with salaries and bonuses of over 150 positions within technology firms in the GTA and KW area.
  4. Don’t take advantage of down markets by underpaying your people relative to the market.  This will often fall apart as soon as the individual finds a properly priced role or as soon as the market takes an uptick.
  5. Don’t misrepresent the job and its responsibilities,  or the company and your present reality. This will come back to haunt you!
  6. Don’t put all your eggs in one basket…that is one individual.  Try to gain leverage by having more than one appropriate candidate available.
  7. Don’t forget to take into account benefits.  Make sure you understand their relative importance, or unimportance, to the candidate.
  8. Don’t think that the only tool you have is salary.  Have them meet some of your top people. Tell stories how you’ve impacted client’s lives. Give them something that really differentiates you.

From the candidate’s standpoint

  1. Don’t wait until the question about your salary requirement is raised by the employer in a negotiation process.  Make sure you’re in the right ballpark early in the interview process rather than wasting everyone’s time.
  2. Don’t fail to adequately understand the employer’s needs and make sure it’s clear how and where your skills match those of the job requirements in order to justify your salary expectations.
  3. Don’t negotiate without knowing your true worth in the marketplace.  Be honest and realistic about your roles and capabilities and do your due diligence on what fair market is in your area of expertise.
  4. Don’t believe that the employer is in the driver’s seat when it comes to negotiation.  Depending on why the position is open and for how long, and special expertise that you bring, there is often leeway in the offer. 
  5. Don’t personalize salary issues. 
  6. Don’t forget to compile supporting proof and documentation of your expertise to use as ammunition for the negotiating process. (See the Employee Evaluation Form on the Resources page of my website).
  7. Don’t forget to take into account benefits as part of the compensation package.
  8. Don’t negotiate salary and benefits over the phone.  Do this only in person.
  9. Don’t lie about your past salary history or alternative salary offers.  This will come back to bite you.
  10. Don’t play “hard to get” when you have little or nothing to leverage.

At the end of the day, the negotiating process represents the beginning of what will hopefully be a long partnership.  Even if negotiations fail, the candidate and the organization will be left with a memory of their experience.  Treat each other with respect and the odds are, even if you don’t have a long and happy relationship, you’ll at least share a sense of mutual appreciation.