Make sure that you get the financial compensation you deserve using a guide to negotiating salary and benefits.
Today, the soft skill of negotiation has become a more crucial skill than ever before. This is especially true when you are trying to secure a competitive compensation package as a new hire or during a promotion.
While you may be given an enticing initial offer, negotiation can lead to a significant increase in your base salary as well as additional benefits or other forms of compensation.
Now here’s a question: Which of the following should you consider before accepting a job offer?
- Salary
- Benefits
- Your personal needs
- Potential drawbacks
- All of the above
If you answered “all of the above,” you are correct! Below, we will consider how to determine what your time is worth, craft a compelling negotiation strategy, and present it to your potential employer.
Know Your Worth
“You is kind. You is smart. You is important.” A long and grueling job search can make you feel like you need just such a mantra. It is important to know your own worth when negotiating salary and benefits, not letting just one company set it for you.
Research market value for your position and experience level so that you will have a baseline to work from. Remember that entry-level positions will inevitably offer less reimbursement than those requiring more experience.
In addition to your current position and experience level, identify your unique skills and accomplishments that are relevant to the job—even if you are switching industries or career paths. Sometimes a high demand for certain soft skills, technical skills, or uncommon skills can increase your worth exponentially.
Crafting Your Negotiation Strategy
Some companies capitalize on their benefits packages in order to attract discerning candidates. Others are less forward. It is your job, therefore, to decide on your desired salary and benefits package and negotiate in order to obtain it.
Most people would consider high salaries with lots of perks to be ideal, but your requests should also be realistic and in accord with industry standards.
How, then, can you determine what salary and benefits to ask for? Start by prioritizing your needs. Maybe you need a flexible schedule so you can balance other responsibilities. Or perhaps you need solid health insurance coverage in order to deal with a health challenge. If you’re moving to take the job, you may need to negotiate for a moving costs stipend or a salary that can easily cover the average rent in the area.
The next step is understanding the employer’s perspective and budget. They likely expect to pay within a range common to their industry—demands far above that average will likely not be met. Be understanding of the constraints they may be under. Expect a counteroffer—your employer is not likely to agree to all your demands in the first round. Be flexible and willing to compromise—after all, you are asking the employer to bend what they are offering. And, if the employer is not willing to comply with reasonable demands, be willing to walk away.
Addressing the Offer
In some places, the salary and benefits on job offers are becoming more transparent. For example, some governments now require the salary to be disclosed in the job posting. In many places, though, you as the job seeker are deep into the hiring process before salary negotiations begin. You might find yourself surprised by the offer; you need to negotiate for more compensation.
How should this conversation take place? Maybe you are a straightforward communicator who prefers face-to-face conversations, or maybe you’re shy and you’d rather send a message. Below, we’ll discuss the pros and cons of different forms of business communication, including a phone call, email, and in-person meeting.
A Phone Call
Pros: A phone call offers a personal touch when compared to a written message. You can also take the opportunity to ask questions for clarification.
Cons: A phone call can also put pressure on both parties involved. You may feel very nervous or forget what to say. Your contact may feel put on the spot and pressured to make a snap decision, especially when you begin throwing out dollar amounts. There is also no paper trail—written documentation—to record any offers given. In other words, you won’t have anything to refer back to later if it’s your word against theirs.
Pros: When writing an email, you can take time to consider exactly what you want to say. Likewise, you will receive a considered response rather than a spontaneous one. You will also have documentation of what is on offer.
Cons: Emails are less personal than verbal communication, and there is the possibility that your message could get lost in the shuffle. There is also the potential for miscommunication. For example, your recipient may read a tone of voice into your words that you did not intend.
In-Person Meeting
Pros: Conversations in person are a great way to build rapport with your potential employer. The ability to make eye contact and observe body language supports clear communication.
Cons: In-person meetings have become less common, so your employer may not be expecting it or see the need for it. It requires scheduling and a longer period of time than other methods. This may result in one or both parties feeling imposed upon.
What to Communicate in Your Response
Whether you plan to write an email, make a phone call, or meet with your employer in person when negotiating salary and benefits, there are a few essential elements that your communication should include.
First, express gratitude for the offer. Even if you are making requests or you eventually choose to decline the offer, a word of thanks goes a long way to making a good impression. The more likable you are, the more likely others are to go out of their way to help you.
Next, highlight your enthusiasm for the position. You can mention the work environment, the nature of the work itself, or elements of upcoming projects. You might even describe how the position relates to your own career goals.
Third, clearly state your desired salary and benefits adjustments. Don’t leave anything to chance by saying “I need additional compensation” and leaving it at that. Give a number or a percentage by which the salary should increase, or note specific perks or benefits you wish to receive.
Use data to justify your request. You might cite your previous salary in a similar role or the average salaries listed by the U.S. Bureau of Labor Statistics. If you need for travel or other expenses to be compensated, list the exact mileage and estimated costs. Leverage your accomplishments to show the value you bring to the company.
Throughout your letter, maintain a professional and courteous tone. Have a trusted person read it and advise you as to whether it sounds overbearing, belligerent, or overly demanding. Humility will aid you in getting the benefits you desire.
Negotiation Techniques
A good negotiation is not like the little girl from Willy Wonka and the Chocolate Factory who sang, “Don’t care how, I want it now!” Tact and respect are needed when responding to counteroffers.
First, don’t get offended. The counteroffer is not a statement of your worth. It is simply an economic tool for getting the most value for the company’s dollar.
If the company is not willing to raise your salary as asked, you might consider asking for additional benefits in lieu of a salary increase. The right benefits package could actually be more valuable than increased outright pay. For example, you might value the freedom of additional weeks of paid vacation. Or you might negotiate for a better health insurance policy that saves you money in the long run via decreased healthcare expenses.
Knowing when to walk away is also an important negotiation technique. When both parties are close to coming to an agreement that is beneficial to both, stick with it. But when an employer is unwilling to budge on your priorities, the back and forth of continued negotiations will likely only cause stress to both parties. Ending negotiations is not a sign of failure—it is an indication of a wise negotiator.
Conclusion
In order to effectively negotiate your salary and benefits, you must do your research to discern your true worth. When you address the offer, do so with reason, respect, and tact, whether via phone, email, or in person. The same is true when you respond to a counteroffer. However, always be willing to walk away.
When you are well prepared and you calmly present your research regarding your qualifications, the value you are bringing to the company, and industry standards, you can come to a mutually beneficial arrangement that reflects your work and sets you up for financial success now and in the future. By using a guide to negotiating salary and benefits, you will be better prepared to get the financial compensation you deserve from your employer.
Appendix: Sample Negotiation Email Template
Writing an email to ask for a higher salary or better benefits can be intimidating. You can pick and choose from the sample paragraphs below to build a negotiation email suited to your unique circumstances.
Dear [Recipient’s name],
I would like to begin by thanking you for offering me the position of [position title] at [company name]. I am looking forward to taking on this [describe the role—challenging, interesting, etc.] and working with you.
That being the case, I feel the need to express concerns regarding the proposed compensation package.
If you are making more at your current job, add: You have offered [dollar amount], but I am making [dollar amount] at my current job with additional perks. [Cite the dollar amount you would be willing to accept, as well as benefits you will require, such as travel expenses].
Or you might say: Due to [site challenges in the workplace, such as a high-stress environment, little downtime, need for special skills, industry standards, etc.], I believe that the current proposal should be increased by [percentage or dollar amount].
I am confident that we will be able to come to a mutually beneficial agreement regarding this issue. Thank you very much for your consideration, and I am looking forward to your positive response.
Sincerely,
[Name and contact information]