Negotiating a pay raise

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ThankYouJack
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Negotiating a pay raise

Post by ThankYouJack » Thu Feb 21, 2019 8:44 am

Who has negotiated a pay raise? What did you do that worked well and didn't work well?

tibbitts
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Re: Negotiating a pay raise

Post by tibbitts » Thu Feb 21, 2019 8:56 am

ThankYouJack wrote:
Thu Feb 21, 2019 8:44 am
Who has negotiated a pay raise? What did you do that worked well and didn't work well?
I'm at the end of my career now, and never did. I never even successfully negotiated a higher-than-initial offer for a new job, although I tried. I never got an employer to move at all in any way (benefits, etc.) over an initial offer. In one case an offer was withdrawn after I asked for about 8% more than the initial offer (hoping for maybe 4%.)

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simplesimon
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Re: Negotiating a pay raise

Post by simplesimon » Thu Feb 21, 2019 9:05 am

What works well: Crafting a well thought-out argument about why you deserve it. Back it up with numbers including your own performance and researching what the market is paying. Glassdoor is only okay...sometimes the data is old...it's best to go out and talk to recruiters and find out what you're worth or ask former colleagues that have recently changed jobs what they're seeing in the market. Think about alternatives to base pay increase: one-time bonus, increased bonus target, or stock options/RSU. Start planting seeds with your manager early on - expect the process to take 6-12 months with regular check-ins and open communication.

What doesn't work well: Not doing the above and expecting something to happen quickly (<3 months). Not saying it doesn't happen, but it's not a strategy.

FederalFIRE
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Re: Negotiating a pay raise

Post by FederalFIRE » Thu Feb 21, 2019 9:14 am

ThankYouJack wrote:
Thu Feb 21, 2019 8:44 am
Who has negotiated a pay raise? What did you do that worked well and didn't work well?
First and foremost: do your research. You need to know your realistic market value based on your skills. Simplesimon gave some good suggestions on how to do this.

Know what you want going in and give serious consideration to what your plan will be if they say no. If you ask for a reasonable pay increase and they say no, and you happily stay on board, you need to consider what that means for your future. If you stay in the job at the same salary you have likely hampered your future negotiating power. Definitely make sure you've thought about this aspect before hand, because it could have significant impacts on your long-term position.

This all comes back to doing your research and being confident that you understand your fair and reasonable value. I would never suggest asking for a raise just to try to get more money, it likely won't end well.

Tal-
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Re: Negotiating a pay raise

Post by Tal- » Thu Feb 21, 2019 9:20 am

Tough topic.

First, understand that asking for higher pay is a high risk ask. It's not uncommon for those who ask for a higher salary to be viewed more negatively after the ask (even if they get it), which can in turn hurt long-term career growth.

Second, be sure that you're justified in the ask. By justified, I really mean "able to demonstrate in an objective way how your pay is inconsistent with the company's philosophy." You really need to look at things from the company's view, and things like "I want more" or "I need more" or rarely relevant.

Third, ask as a story. Only use arguments that are consistent with why you're justified in your ask. For example, if your job code is not consistent with your actual duties, tell that story. If you're in a performance-based workplace and your pay is not commensurate with your performance, tell that story. Note that you can only do this with a pretty good understanding of how the company views compensation - so don't go in saying "my college classmates make more!!!" because your employer won't really care about that.

Fourth, ask (your boss) respectfully. As much as possible, try and highlight your pay as an irregularity that can easily be fixed. My favorite view is to take the approach of, "I'd like to float a sensitive topic, and get your thoughts..." before outlining my case in <5 minutes. Then, end with "it's possible that I'm missing something, but it feels like I'm actually being underpaid relative to..." Any manager who is worth his/her weight in salt will see this as an issue to be resolved.
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livesoft
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Re: Negotiating a pay raise

Post by livesoft » Thu Feb 21, 2019 9:22 am

I switched employers and asked for more than was offered.

Always think about this: The money has to come from somewhere. Many companies now have a discretionary bonus because it does not lock in a higher amount now and in the future.
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mako171
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Re: Negotiating a pay raise

Post by mako171 » Thu Feb 21, 2019 9:26 am

Unfortunately i cannot name them off the top of my head, but there have some incredible posts and threads on this topic over the years. Real gems. You just need to dig for them.

Mister A
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Re: Negotiating a pay raise

Post by Mister A » Thu Feb 21, 2019 9:32 am

tibbitts wrote:
Thu Feb 21, 2019 8:56 am
I'm at the end of my career now, and never did. I never even successfully negotiated a higher-than-initial offer for a new job, although I tried. I never got an employer to move at all in any way (benefits, etc.) over an initial offer. In one case an offer was withdrawn after I asked for about 8% more than the initial offer (hoping for maybe 4%.)
All I can say about the withdrawn offer is that if you know what you're worth and they won't work with you, they're probably doing you a favor letting you walk away.

The best advice I can give to the OP, is to choose several data sources, and work out a number that you can defend confidently and explain how you came to it in an articulate manner. If you've already accepted a salary trajectory and are trying to change it, you'll need to have specific arguments about how the situation has changed.

If you feel, during this conversation, that they're coming in much lower than expected and will panic at your number, you can softball it as something like "from my own research, I've found that X would be more typical - that's not really an ask, but I'd like to hear you out on how you've arrived at Y based on what we've discussed here".

Actual experiences:

- I made a mistake in my last position and took the initial offer because I didn't realize that the job description was a step ahead of where I thought I was going, career-wise. I had to ask for a significant reconsideration during the next salary review, to the tune of over 20%. I was able to find salary data that suggested my pay was appropriate for an entry-level/"level I" position in my field and make the argument that that was how the position had been described, and that I had actually taken on responsibilities akin to the description of the mid-range/"level II" role. The CEO objected that they don't view employees in hierarchical terms, but I ended up getting half of it that year and half the next.

- Five years later, I had to ask again, for 10%, due to changes in the management structure that were making my job much more time-intensive. I gave my director advance warning during the post-mortem call on a particularly circus-like project, two months before the salary review. After I was offered 3.5%, I had to bring it up again, and after a month of stalling, got a sit-down with the CEO. I ended up getting a total of 6%, with the promise that they'd take the rest of my number into account at the next review.

- I then ended up negotiating an offer at another firm before the end of the year that worked out to another 2%, plus a 4% bonus. I explained that to justify the risks of the transition from a job that I already loved, I was looking for a figure closer to 8% on salary, at which point the CEO threw another 2% onto the offer and stressed that the bonus was real and I could count on it.

I've never been very forceful in these negotiations because I'm not looking to leave bitterness behind me and always treat the counterarguments with respect. If you've done your homework, you can communicate politely and graciously and still get most of your way. When I left my last position, the CEO repeatedly told me - as well as my spouse - that he felt they'd missed opportunities and to please stay in touch and call him first if I ever go job hunting again.

RollTide31457
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Re: Negotiating a pay raise

Post by RollTide31457 » Thu Feb 21, 2019 9:33 am

Doesn’t happen in a mega corp environment. The only people negotiating pay raises would be those in small businesses or new job starter salary negotiations.

TheHouse7
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Re: Negotiating a pay raise

Post by TheHouse7 » Thu Feb 21, 2019 9:41 am

RollTide31457 wrote:
Thu Feb 21, 2019 9:33 am
Doesn’t happen in a mega corp environment. The only people negotiating pay raises would be those in small businesses or new job starter salary negotiations.
+1 I just figured this out in the last 2 months. Major management changes dramatically increased my workload, roles, responsibilities. I asked for a 25% raise. My new boss was very understanding, but could only give me a promotion had a flat 5% before my merit increase of 3%. I replied with disappointment, but my new boss was adamant that there was no negotiation and started talking about my next promotion next year with another 8%(total).

My boss talked up the fact that he could give me 5% before 3% as some kind of mathematical bonus. :annoyed
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stoptothink
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Re: Negotiating a pay raise

Post by stoptothink » Thu Feb 21, 2019 10:20 am

TheHouse7 wrote:
Thu Feb 21, 2019 9:41 am
RollTide31457 wrote:
Thu Feb 21, 2019 9:33 am
Doesn’t happen in a mega corp environment. The only people negotiating pay raises would be those in small businesses or new job starter salary negotiations.
+1 I just figured this out in the last 2 months. Major management changes dramatically increased my workload, roles, responsibilities. I asked for a 25% raise. My new boss was very understanding, but could only give me a promotion had a flat 5% before my merit increase of 3%. I replied with disappointment, but my new boss was adamant that there was no negotiation and started talking about my next promotion next year with another 8%(total).

My boss talked up the fact that he could give me 5% before 3% as some kind of mathematical bonus. :annoyed
I didn't personally negotiate a raise, but my boss (chief medical officer) negotiated a 20% raise for me in December (without my knowledge). Because pay bands are so structured in larger companies, without a title change these things often are not possible. It was hilarious hearing how my boss (who is one of the 4 founders of this multi-billion dollar company) literally had to do the research to find out what competitors pay people in my role and then argue with HR. His partners (the other 3 members of the executive committee) all agreed on my raise, but HR wasn't budging because it meant my pay would exceed the current band. So, ultimately they had to make a new title, but my job is still exactly the same.

I have an awesome boss. He is incredibly frugal, people are shocked when they hear how little I make considering my job title (and I was floored to find out how much more I make than some of my colleagues, all PhD scientist rock stars), but he goes to bat for employees he trusts.

Annabel Lee
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Re: Negotiating a pay raise

Post by Annabel Lee » Thu Feb 21, 2019 10:30 am

RollTide31457 wrote:
Thu Feb 21, 2019 9:33 am
Doesn’t happen in a mega corp environment. The only people negotiating pay raises would be those in small businesses or new job starter salary negotiations.
-1. This is simply untrue.

Salary negotiation happens all the time for a myriad of reasons including salary compression resulting in below market pay, competitive offers to colleagues, and changes in market dynamics.

However - if you don't ask, you'll never receive.

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market timer
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Re: Negotiating a pay raise

Post by market timer » Thu Feb 21, 2019 10:42 am

Only time I ever received a decent raise was as a counter-offer. It was a 50% raise and promotion. Ever since then I regularly interview with other firms to make sure I'm not below market.

Andyrunner
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Re: Negotiating a pay raise

Post by Andyrunner » Thu Feb 21, 2019 11:05 am

Yes, sort of.

I was an analyst at my current company, next step up is a senior analyst. I did two things, I applied for a job in another department I was genuinely interested but didn't get it. I think that sparked a bit of a fire under my boss that I was considering leaving the dept. and there was big compliance risk if I left as I am the only one who knows my job as well as I do. After getting rejected I asked my manager what I needed to do to move up to a senior analyst. In my opinion I was doing the senior analyst work for almost two years already and my peers saw me as a senior analyst. Within 3 weeks my 2nd line manager put in the request for a promotion if I took on some additional work, in which I had the capacity to anyway. I saw a 15% raise.

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Re: Negotiating a pay raise

Post by Jack FFR1846 » Thu Feb 21, 2019 11:12 am

Every raise I negotiated was either on the front end when starting a job or when I told my present employer about an offer I had and handed in my resignation. Only one time did I not have to leave, being convinced that not only would the present employer match the number, but that other job related things would be changed to go my way.

I've not even heard of anyone getting anything at any megacorp I've worked for. The few times managers are allowed to give raises, they are given a piddly amount and told that this is it....divide it among your 25 reports. So if you want a raise, you're going to have to convince your manager that someone is a real slacker and deserves a demotion and reduction in pay.

The cries from the top are that the company needs to stay competitive (by paying people peanuts) and don't look behind the curtain to see that C suite executives are taking home a million dollars a quarter in bonuses.
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Thegame14
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Re: Negotiating a pay raise

Post by Thegame14 » Thu Feb 21, 2019 11:19 am

The only way I have ever gotten a negotiated raise was with an offer from a new employer and even then, it is 50/50 if I got the raise I requested. Some offers I have been told are take it or leave it.

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Re: Negotiating a pay raise

Post by Dottie57 » Thu Feb 21, 2019 11:20 am

simplesimon wrote:
Thu Feb 21, 2019 9:05 am
What works well: Crafting a well thought-out argument about why you deserve it. Back it up with numbers including your own performance and researching what the market is paying. Glassdoor is only okay...sometimes the data is old...it's best to go out and talk to recruiters and find out what you're worth or ask former colleagues that have recently changed jobs what they're seeing in the market. Think about alternatives to base pay increase: one-time bonus, increased bonus target, or stock options/RSU. Start planting seeds with your manager early on - expect the process to take 6-12 months with regular check-ins and open communication.

What doesn't work well: Not doing the above and expecting something to happen quickly (<3 months). Not saying it doesn't happen, but it's not a strategy.
At a small company (50 people) I would bring a list of my accomplishments. We ended up bargaining and I mostly received what I wanted.

At megacorp, you had to start early. Primary is to be on top of your managers ordered list of workers since this is a competition. Each manager is given an amount for raises and bonuses so if you didn’t work on important projects your raise and bonds is not good.

If you want to a promotion work with your manager a year ahead of time. Enlist their help.

Always remember you are a cost and you need to make sure your work is worth their cost.

nick evets
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Re: Negotiating a pay raise

Post by nick evets » Thu Feb 21, 2019 12:11 pm

Dottie57 wrote:
Thu Feb 21, 2019 11:20 am

At megacorp, you had to start early. Primary is to be on top of your managers ordered list of workers since this is a competition. Each manager is given an amount for raises and bonuses so if you didn’t work on important projects your raise and bonds is not good.

If you want to a promotion work with your manager a year ahead of time. Enlist their help.

Always remember you are a cost and you need to make sure your work is worth their cost.
I agree.

It's most certainly possible to give (and get) raises at a megacorp, but the money available is driven by many factors, like business unit performance, etc.

There aren't enough (any!) specifics in the OP to even begin to address this accurately, beyond: have a conversation with your manager or employer.

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ThankYouJack
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Re: Negotiating a pay raise

Post by ThankYouJack » Thu Feb 21, 2019 1:17 pm

Thanks all. Some good tips. I think definitely laying out my workload (it recently increased quite a bit) and market rates, including what I made as a freelance consultant.

I actually negotiated 2 1/2 years ago for reduced hours and an increased hourly rate. It went through as my employer didn't want to lose me, but it may be a bit soon for another raise. I know I could make more, but my current gig has a great work - life balance so I'm willing to work for less. Things move quite slow though so there's some frustration with that.

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Re: Negotiating a pay raise

Post by market timer » Thu Feb 21, 2019 8:28 pm

From what I've seen at large companies, the job is generally a good deal for the slackers and a good deal for the executives, who are really playing a completely different game from the rest of us. Everyone trying to climb the ladder is better served looking for work elsewhere or acquiring the skills to apply for other jobs.

The idea that there is a ladder to climb is itself misleading. Each level of the ladder requires a different set of skills than the prior level, unless you are talking about moving along an individual contributor track.

Much of this is detailed well in Venkatesh Rao's blog ribbonfarm and book The Gervais Principle. The corporate hierarchy is quite clear:

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ThankYouJack
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Re: Negotiating a pay raise

Post by ThankYouJack » Thu Feb 21, 2019 8:43 pm

^^ Haha, that's pretty funny. I do enjoy working for small companies best with very bright people that I can learn from.

mmmodem
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Re: Negotiating a pay raise

Post by mmmodem » Thu Feb 21, 2019 8:51 pm

I've never received a raise without another job offer. I've done the research at salary.com et al to get salary comparables. I've made my case with examples of the value I bring to the company. I've outlined what I will do in the future to deserve the raise with no avail. Nothing ever worked until I had a solid offer and was prepared to leave.

ny_knicks
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Re: Negotiating a pay raise

Post by ny_knicks » Thu Feb 21, 2019 10:35 pm

Girlfriend was recently promoted to a management position after switching over from floor nursing.

Received a 40% raise if you include a 12% discrenary bonus. Also negotiated full tuition reimbursement to get a masters (her past position had this benefit and it was a must to get her to move).

Their initial offer was only a 10% raise. She came back with strong points about market rates, loss of union benefits, as well as a plan for initiatives she intended to spearhead in the first year.

This was an internal transfer where no one else interviewed for the job and senior management wanted her in the position. HR said no raise so she went to senior management. She was in the office for 5 minutes and they didn’t even let her speak - just said I’ll make this easy for you and emailed HR saying give her what she wants lol.

Internal moves need someone high up with control over large budgets and significant influence in the direction of the firm to go to bat for you. A mid level manager isn’t going to cut it.

She won over their graces by going above and beyond on a special project that had a huge impact on the hospital - she proved her worth and knew the value she would bring.

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GoldStar
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Re: Negotiating a pay raise

Post by GoldStar » Fri Feb 22, 2019 10:52 am

- Know what you are worth in the market (use Glassdoor data, etc. If you have access to Radford and other data used by your industry- even better).
- Know what you are worth to your boss (use performance review data - where you rated excellent?, etc.)
- Know what you are worth to the organization (How has your work contributed to either revenue or cost savings?).
- Be humble, if you've got a personal story to share, don't be afraid to use it.

String all the points above together when you approach your manager. Putting all this together your story should be something like "I feel we have a great working relationship so I'd like to be transparent with you. I've had a number of unsolicited reachouts from recruiters who have pointed out, which I've confirmed, someone in position is typically in the XX-YY range. Since I've gotten an exceptional rating on my last two performance reviews, and know that my work has personally contributed to abcdef growth over the last few quarters, I'd like to know what we can do to get me within the market. With the reviews I've had I would expect to be on the high side; but from what I understand I'm on the lower side. I really like working here and really don't want to return calls from these recruiters but I do need to look after the interests of my family [and do have (Kids going to college; need to pay for private school next year; etc.)]. Can you work with me on my salary concerns and needs ....

I wonder if the folks that have responded "Doesn't happen"; "The only time was when"; etc. have actually tried.

Stick5vw
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Re: Negotiating a pay raise

Post by Stick5vw » Sat Feb 23, 2019 3:05 am

The times that I have received a raise from my mega corp usually came during the annual "cycle" when title promotions happen and/or comp is re-set for the upcoming year. In my case, this also happened when I changed jobs from one country to another (has happened 3X) when my contract was drawn up to comply with local regulations etc and they could start adjusting the numbers based on cost of living, taxes etc.

These jumps were usually accompanied by taking on roles with significantly more responsibility, so if you want a raise make sure you demonstrate that you are going to do more work after you get it (this will help your manager make his or her case).

Therefore my advice would be (1) get promoted (easier said than done, I know) or (2) find a job with more responsibility. In both cases start lobbying for yourself really early and often (with hard stats/info showing you are crushing your current role), so that when those comp bumps take place, your name is on the list of those who should get a promotion/more responsibility/raise etc.

In all instances, management usually is bound by certain % bands that cap what they can give you, and big exceptions from the norm usually require someone to stick their neck out for you.

Depending on where you work, management can give you a bigger year end bonus to help make up some of this gap you feel may exist on your base salary. (ie focus on the "total comp") Bonuses are often where managers have a lot of discretion to reward top performers.

The only times that I have seen deviations from this is if one has basically accepted another job offer, and they want to extend a counter offer to keep you. (and personally I believe that accepting a counteroffer is always a bad idea!)

Fighting for a raise unless you have stellar credentials/job performance, a promotion coming up, or you are changing roles requires some delicacy and if not handled well you can really pi*s off management, so tread carefully. (I found this out the hard way once, trust me)

Otherwise, the next best alternative is to leave the company and work somewhere else, which I have seen plenty of people do too.

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