by Gina Rautenberg
When it comes to negotiating salary, is there a disadvantage to being too transparent? This week, a current job seeker sent our Power Panel a question about how to respond when asked for her salary requirements. Read on to learn how you can maintain control when a recruiter or hiring manager starts a conversation about your past or future salary.
I'm currently seeking a new job and I had a recruiter screening this morning. In that call, the recruiter asked me what my hopeful salary range would be. I currently make $75,000 with an annual bonus that tends to be around $5,000.
However, I've worked at my same company for 8 years and I haven't received many large bumps in pay over the years. In my next job, I hope to make at least $90,000.
In the call, I was honest about my current salary even though the question was really phrased as what I hope to make in the future. I'm not sure I handled it correctly and have a few questions for you:
When asked about my salary range, can I bypass what I currently make and simply give the range of what I hope to make? Is there any way that an employer would be able to check my current salary when they call in to verify my employment? If so, should I worry about adding such a large amount to my new salary range?
DON'T FALL FOR THE ANCHOR
Kim S., an IT executive with 25 years of hiring experience, weighed in first. She mentioned that if possible, job seekers should avoid offering their current salary or their hopeful salary if hired. Why? Kim says that by offering a number first, job seekers lose their leverage.
This is a great question and I hear variations on it quite a bit. I would give two suggestions to this person. First, I would always avoid discussing salary history if there is any way to avoid it. That number serves as an "anchor" to the recruiter and offers will only be limited by it. If you receive a lowball offer below your current salary, that is the only time to raise the issue by saying, "Well, I currently make X, and am looking for at least Y percent more."
But to answer with a bit of strategy, I also would always avoid answering the "hopeful salary range" question. It can only hurt the prospective employee, never help. It will either serve as an anchor or rule someone out as "too expensive." On the unlikely chance that the employee guesses right and hits the hiring range (or just chooses to confirm the hiring range they already knew from the job ad), it still doesn't help them in any way. It is always a position of power in negotiations for the OTHER person to commit to an opening offer first, and that is certainly true for job negotiations.
I suggest playing it off with humor: "Oh well, I'd hope for $1M but who wouldn't!" Or if that doesn't work, use a polite redirection like, "I would of course hope to make a good market rate for this work, but I am more interested in a challenging job and good fit. Salary is negotiable." It sounds like downplaying salary, but it's actually just holding cards close to the vest to play them later.
To answer the other question about a new employer verifying your past salary, it's rare that companies will disclose salary information in reference calls. They have no reason to help their competition. But it's a bad idea to lie about previous salary (or anything else!) because employers have many ways to get that information.
Last, if an employer does know your previous salary and asks why you are requesting such a large jump, your new salary requirement can be explained in so many ways. You may be able to differentiate the difficulty of the new job compared with the old, or explain that you have gotten more training or experience since your last raise. No one is obligated to feel limited by their previous salary. Never fall for that "anchor!"
DON'T SAY MORE THAN YOU HAVE TO
Katherine Turpin, a Senior IT Recruiter, agrees with Kim that job seekers can justify their new desired rate in various ways if pressed by a hiring manager. And for those who don't think they're confident enough to toss out Kim's "$1 million dollar" joke, Katherine offers another way to request your desired number in a firm way.
This is such a great question & common scenario! First of all, it’s important to look at market data before negotiating for a salary. Sites like Hired.com and RobertHalf.com offer salaries by role. She’ll feel confident going into a salary negotiation if she’s done her homework.
If $90k is market rate, then, “I’m glad you asked: I’m looking for $90k/year, and I’m being considered for several other roles at this salary” would suffice. Note: say this and STOP talking.
If the prospective employer asks “Why such a large increase?”, she can talk about her base + bonus, and give hard data (i.e., the years when she didn’t receive a cost-of-living pay increase) to close the gap. She might also talk about accomplishments at her current company that had a direct, measurable impact on bottom line.
It’s also worth mentioning that cost of benefits & the amount of PTO in the new company should be weighed (as well as commute). The cost of benefits may be less, she may wind up with more PTO and/or a shorter commute. This may soften the need for that $90k salary. In the end, some flexibility on both sides can end up with a ‘yes’.
DON'T LIE ABOUT PAST OR DESIRED SALARY
Our last Power Panelist, Jackie B., comes at this conversation from a different point-of-view. As a non-profit HR manager, Jackie works within a tight budget. To be fair to herself and the candidates she's interviewing, she prefers both sides to speak candidly when negotiating salary.
Since I'm in non-profit, there is generally a set budgeted salary without much wiggle room for negotiation. Therefore, I try to be as transparent as possible regarding salary.
When asking the question about salary requirement, my preference is that the candidate be honest about what salary they would require to accept the position. Therefore, if they are currently at 80k, but feel based on their experience and the position they are applying for would require 90K to accept the position, I would want to know that. If our budget max is $85k, I would explain that and highlight our amazing benefits.
I believe the best answer would be, "I'm currently making $80k, but based on the experience I bring to the position as well as the expectations/level of the position, I would hope for a salary of $90k. However, it is negotiable." If it's not negotiable, don't say it is.
Having a conversation about the salary is really important and I generally have the conversation early on so the expectations are realistic.
Regarding verifying salary, it generally can be verified (or candidates may be asked to complete an application asking for current salary). Therefore, I'd be honest about it — both with the current salary and the salary requirement.
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