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Job Search: How to Negotiate for a Salary When Offered a Job

Updated on May 22, 2013

How Companies Set Their Pay Structure

Companies have different ways of structuring their pay. Pay structure reflects decisions about how much to pay and should reflect what the organization knows about market forces. A company should weigh all the objectives of their pay structure to arrive at suitable rates. If a company decides to use a pay grade system, the drawback is that the pay may not precisely match the levels specified by the market and the company’s job structure. Pay grades are sets of jobs having similar worth, grouped together to establish rates of pay. Companies want some flexibility in setting pay for individuals. A pay range is a set of possible pay rates defined by a minimum, maximum, and midpoint of pay for employees holding a particular job or a job within a particular pay grade. Pay grades give companies flexibility and motivate employees thru promotions. Skill-Based Pay Systems are pay structures that set pay according to the employees’ levels of skill or knowledge and what they are capable of doing. Companies chose which method they wish to use to determine the pay for a particular position. This may or may not give a job seeker room to negotiate.

What You Want in a Job

There are many things to consider when deciding whether to take a position or not. You need to know what is truly important to you. It’s not about knowing the minimum you will accept; it’s not about what you can afford; it’s not about what you think you deserve; it’s about happiness. Ask the following questions when comparing companies:

Do you get a feeling this would be a great place to work?

Can you work from home?

How much travel is involved?

What is the work/life balance like?

Will you be interested and motivated here?

Do they have firm deadlines or a flexible schedule?

Will you work alone or with a team?

Is there a lot of pressure and challenges?

Can you advance in this position?

Is the travel distance to work reasonable?

Is the company ethical?

Other Factors to Consider Before Negotiating:

 
1. Decide what is most important to you in terms of your employment.
2. What do you expect from the job offer?
3. What is the minimum amount of money and benefits you will accept?
4. Are there any negotiating elements you are flexible on?
5. What do your family, friends, and associates think about the company?

If you decide that the company is not the best fit for you, thank the company for the offer, but that you think it will not be a satisfactory fit after all. If you think the company may be a good fit, but it is not your first choice, express your pleasure at being offered the job, but ask for some time to think it over. After that, call the other companies that were at the top of your list, and explain that you received a job offer, but that you would rather work for them. Then, ask what the status of your application or resume is at the current time. If you decide to accept an offer, contact the other companies who were considering you to let them know you accepted a job elsewhere. They will appreciate the courtesy.

Researching

When researching, a company should represent what the competition pays or more. To research the industry’s pay rates, try researching payscale.com, glassdoor.com, or vault.com. Also, talk to people in the industry to find out what the average pay is. It is important to know the rate of your position, and research the average salary of that salary. Things to study about a company before accepting an offer include: an intimate knowledge of the target company, the company’s competition, what the company values, what the company’s culture is like, and what kind of career path and advancement opportunities the position offers at the company.

When to Begin Negotiations

As a job seeker, the best time to negotiate for salary and benefits is after you have the job offer. The secret of professional happiness is taking a job where the positives are things you want and the negatives are things that don’t matter much to you.

Most people have the wrong impression when it comes to negotiations and when they begin. They think that once they send in their resume and get an interview, they will be asked for their salary requirements. Then, the company will offer a salary similar to the requirement, and the job seeker can try to negotiate that offer, if he or she has the courage to do so. This does happen, but there is a better way for a job seeker to gain the best salary possible.

A much better approach is to establish a strong reputation in your field as someone who helps a company achieve its missions, visions, and goals. After you are a strong asset, speak to the Human Resource department at the company you are interested in. Ask if they have any openings or know of a similar company that has a good reputation and currently has openings. When speaking to a representative in the Human Resource department, be cordial, smile, and lead the conversation towards the fact that it would be mutually beneficial for you to work there. Make them really want you! Let them be the first to discuss a mutually fulfilling offer. Most likely, once they decide they want you, they will spend a lot of time deciding what pay to offer you. After speaking with you, interviewing you one or more times, and carefully reviewing your resume, if they have decided they want you, they have invested a lot of time in choosing you as their first candidate. They want to reach an agreement with you, which gives you leverage. Now that they really want you, it is time to negotiate. Keep in mind that negotiating should never take place unless they have already decided they want you. If you bring up salary before that, this may turn them off of you. Negotiating never makes things worse than they already are. The worst outcome of a negotiation is getting what they offer you.

Negotiations

Always try to negotiate. You have nothing to lose. Let them throw out the first number though. If you are unsure about negotiating, handle it professionally, and prepare for the fact that you will need to negotiate. Don’t give them an ultimatum or act like money is all you care about.

If you negotiate in person, watch their body language. The benefits of negotiating in person is that you can have immediate interaction and address questions right away. If you negotiate in writing, you won’t be put on the spot, and it gives the employer a chance to review the offer with others.

Salary is not the only thing that is negotiable. Not all benefits may be negotiable, but some may be. You must decide what is important to you. Here is a list of benefits you should discuss with your future employer before accepting the job:

Benefits

 
 
 
Paid vacations and sick leave
Health and life insurance
Flex time
Child care
Pension plan
Reimbursement for education expenses
Savings and profit sharing
Bonuses
Commissions

When negotiating, keep your head held high and smile. Be sure to remember and use their names to show professional. Treat the potential employer with respect, and be polite. Be very positive, and continue to express your interest in the position. Regardless of how you negotiate, thank them for the offer.

Acceptance of Job Offer

Once you accept a job offer, make sure it is in writing confirming the terms of the offer. The acceptance letter should spell out not only salary, but also benefits and anything else you have negotiated. Read the offer carefully to ensure it is correct.

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