[Getting a promotion, how do I negotiate a raise?]

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ChiKid24
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[Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

[Title was "Post your 2021 promotions" --admin LadyGeek]

My boss recently got promoted and soon after had the talk with me that he's gotten approval for me and is working with HR. Since everything is typically negotiable, I'm curious to hear what people promoted this year have gotten.

For me bonus target and long term incentive are set by the company based on level. So not much to negotiate there. The key is the new salary. If you're willing to share, please provide your salary % increase from a recent promotion, not just your annual same level salary increase. If you were able to negotiate it, what did they start at, how did you counter, where did you end up?

We all know the job market is tight and inflation is looking very real. We recently went through a 6 month search to find candidates in my group at one notch below my level and it was a very difficult process and ultimately we settled on an average candidate just because we need the heads. At other companies during different times it felt like 10-15% salary bump is generally offered for promotions. I'm thinking of preempting that by telling my boss I'm looking for 25% We have a good relationship and he knows I could find something somewhere else at that level. I suppose I could wait for their offer, but think its better to shoot high to provide a goal post so that nobody is disappointed or feels awkward if they come in far below.
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Re: Post your 2021 promotions and raises

Post by Flyer24 »

This thread has run its course and is locked (not personal nor actionable). General comment threads are off topic in the forums with "Personal" in the title. See: A reminder that non-investing general comment threads are OT
- It must be personal. In other words, you must be asking about your own situation. You can also ask on behalf of someone specific, such as a family member.

- It must be actionable. You must be able to do something specific with the replies that will make a difference in your situation.
If you have a specific question, please ask directly and provide sufficient information for members to supply appropriate advice.

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Re: [Getting a promotion, how do I negotiate a raise?]

Post by LadyGeek »

The OP notified the moderators that the thread is actionable because s/he is in the process of negotiating a raise in connection with a promotion. I have retitled the thread to clarify the intent.

This thread is unlocked to continue the discussion.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by RickBoglehead »

What anyone else got for a promotion is irrelevant since it is so industry, job, and company specific. My 30% raise in a company change and my 50% increase with a promotion mean nothing. Situation-specific. Key role, key person, lucky to have been in the right spot at the right time.

I would suggest that 25% is too high, but what do I know?
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wilked
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by wilked »

Your 25% will likely get laughed at.

I'd say 5-15% is the expectation for megacorp

The typical way to get higher is to get an external offer and get countered

good luck
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by wackeym »

What is your BATNA if they balk at your 25%? Is it strong (having another offer in your hand that you will accept)? If you don't have that type of leverage and willing to flex it, not sure you have any leverage at all. Don't overplay your hand; take the increase and new title and then in a year if you feel underpaid renegotiate or test the market again.

At places I've worked, 25% salary increase for an in-line internal promotion seems generous. Unless this is some sort of sales role.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by TomatoTomahto »

As I recall, my wife got no salary raise in her last promotion. She expected, and received, new targets for incentive pay but iirc that was some months later.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by HomeStretch »

The appropriate raise for your promotion is situation-specific.

In connection with the promotion, are you receiving a title change (for example, “Analyst” to “Sr Analyst”) and will be doing essentially the same job?

If yes, unless your current salary is way below the new salary band (if any) or significantly below market, a raise of 5-15% is likely reasonable and with the higher % you might not receive any further merit increase for the year. There is likely no ‘negotiating’ salary.

If no, if this is a new/different/more experienced role with significant increased responsibilities, you might receive 15%+. More if it’s a big jump in level (i.e., ‘Director’ to ‘Vice President’).

The best way to negotiate salary (assuming your employer will negotiate) is to test the market for your new position.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by BlueCable »

At my megacorp, a promotion is worth about 10%, base salary and 16 percentage points max bonus / 8 percentage points target bonus in the front line manager or mid manager level of the company.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by MAKsdad »

If you're getting a significant increase in bonus and/or equity comp, you shouldn't necessarily also expect a large base increase. My company is focused on total compensation, so if someone goes from, say, no bonus to 25% bonus, their base is only going to go up 4-5% with a promotion. If there's no change in bonus, 10-12% is the normal increase associated with a promotion.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by TomatoTomahto »

MAKsdad wrote: Tue Jul 20, 2021 8:02 am If you're getting a significant increase in bonus and/or equity comp, you shouldn't necessarily also expect a large base increase. My company is focused on total compensation, so if someone goes from, say, no bonus to 25% bonus, their base is only going to go up 4-5% with a promotion.
This.

My wife’s base salary hasn’t changed all that much over a few decades, while her total comp is markedly higher.

Total comp is the way to think of it, but it reminds me of people who favor dividend stocks over total market returns; just show me the money.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Jags4186 »

I received a 7.5% raise for a promotion at my Megacorp in December. This was mid cycle, i.e. 4 months after company wide raises were handed out where I had received a 4.5% raise. I received no increase in bonus incentive, other than it was based on a percent of my new, higher salary.

I also wasn’t given a heads up…I was called out of the blue by my manager and said “hey we’re making you X and you’ll be getting a Y raise.” Which caught me off guard and took away any real possibility for negotiation. I asked about changing the bonus structure but that was met with a “I’ll look into it” and then it was never spoken about again.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Jags4186 »

TomatoTomahto wrote: Tue Jul 20, 2021 8:10 am
MAKsdad wrote: Tue Jul 20, 2021 8:02 am If you're getting a significant increase in bonus and/or equity comp, you shouldn't necessarily also expect a large base increase. My company is focused on total compensation, so if someone goes from, say, no bonus to 25% bonus, their base is only going to go up 4-5% with a promotion.
This.

My wife’s base salary hasn’t changed all that much over a few decades, while her total comp is markedly higher.

Total comp is the way to think of it, but it reminds me of people who favor dividend stocks over total market returns; just show me the money.

Exactly. Bonuses are great when they pay out. But a 25% bonus target that isn’t met, or is cut due to some bean counter’s mistake, or $15/hr production employee royally messing up isn’t worth very much.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by MAKsdad »

Jags4186 wrote: Tue Jul 20, 2021 8:11 am
TomatoTomahto wrote: Tue Jul 20, 2021 8:10 am
MAKsdad wrote: Tue Jul 20, 2021 8:02 am If you're getting a significant increase in bonus and/or equity comp, you shouldn't necessarily also expect a large base increase. My company is focused on total compensation, so if someone goes from, say, no bonus to 25% bonus, their base is only going to go up 4-5% with a promotion.
This.

My wife’s base salary hasn’t changed all that much over a few decades, while her total comp is markedly higher.

Total comp is the way to think of it, but it reminds me of people who favor dividend stocks over total market returns; just show me the money.

Exactly. Bonuses are great when they pay out. But a 25% bonus target that isn’t met, or is cut due to some bean counter’s mistake, or $15/hr production employee royally messing up isn’t worth very much.
Agreed. I'm lucky to work at a company where bonuses are 100% objective too. I've seen places where there is a subjective component that never gets fully paid out.
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ChiKid24
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

Thanks all for the responses. This question is really meant for those that have gotten a promotion this year and whether they've had any leverage in these types of discussions. The job market is super tight right now. Again I know this because we struggled finding and hiring attractive candidates. We even had one person start and leave within 4 months which caused a huge disruption. My boss knows we are understaffed, knows what I can offer, and is giving me the heads up that one is coming. This will be title bump, bonus target bump, equity bump, and I'll be managing more people. Of those, the salary is the only component that isn't set based on the title.

This is negotiable and Id be crazy not to push to maximize it since annually raises only tend to be 2-5%. In my line of work 10% is probably the typical inline level up promotion salary increase. Asking for 20% would be an incremental $25k salary. Given the current market and our experiences looking for candidates in our line of work I believe my boss would find that additional pay a bargain to avoid going through the time and effort of another hiring process.

Lastly this wouldn't be a threat. He and I have a good working relationship and our families spend time together outside of work. This is really to have an open conversation with him so he can advocate for me to HR. He knows there are opportunities available to me outside the company at higher pay if I wanted to jump ship. He's told me in the past to be patient as it wasn't possible until he got promoted (which just happened).

So again, if you've gone through a promotion recently, was it better than what you've experienced in the past? Did you negotiate and ask for more? Did they offer more? Thank you all!
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by market timer »

I haven't seen anything in this thread to indicate this is a negotiation. I think it would not be advisable to propose a 25% target in this scenario. You have no leverage, as far as I can tell. Just be glad to get the recognition, token raise, and possibly higher incentive compensation.

If you are unhappy with your current compensation, I'd suggest discussing with your manager the potential for more performance-based compensation, if what you are doing can be easily translated into profitability. If what you are doing cannot be translated into profitability easily, it will be hard to negotiate for compensation, and you are pretty much left with negotiating for things like working hours, time off, travel, etc. The only way to get a meaningful raise in that scenario is to get another offer.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

market timer wrote: Tue Jul 20, 2021 8:47 am I haven't seen anything in this thread to indicate this is a negotiation. I think it would not be advisable to propose a 25% target in this scenario. You have no leverage, as far as I can tell. Just be glad to get the recognition, token raise, and possibly higher incentive compensation.

If you are unhappy with your current compensation, I'd suggest discussing with your manager the potential for more performance-based compensation, if what you are doing can be easily translated into profitability. If what you are doing cannot be translated into profitability easily, it will be hard to negotiate for compensation, and you are pretty much left with negotiating for things like working hours, time off, travel, etc. The only way to get a meaningful raise in that scenario is to get another offer.
Thanks for that. Did you go through a promotion process this year? That's really who I'm asking.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by TomatoTomahto »

My wife’s promotion was this year and no direct salary increase. ETA: there were indirect changes to some benefits, but nothing that would be considered salary, and the benefits were moderate in impact (maybe a few percent).

I would wonder if having a social relationship outside of work would actually put a damper on your boss’s willingness to go big on a raise. He just got promoted and is probably being observed; last thing I’d do in a situation like that is give a friend a whopping 25% raise.
Last edited by TomatoTomahto on Tue Jul 20, 2021 9:00 am, edited 1 time in total.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by MAKsdad »

ChiKid24 wrote: Tue Jul 20, 2021 8:50 am
market timer wrote: Tue Jul 20, 2021 8:47 am I haven't seen anything in this thread to indicate this is a negotiation. I think it would not be advisable to propose a 25% target in this scenario. You have no leverage, as far as I can tell. Just be glad to get the recognition, token raise, and possibly higher incentive compensation.

If you are unhappy with your current compensation, I'd suggest discussing with your manager the potential for more performance-based compensation, if what you are doing can be easily translated into profitability. If what you are doing cannot be translated into profitability easily, it will be hard to negotiate for compensation, and you are pretty much left with negotiating for things like working hours, time off, travel, etc. The only way to get a meaningful raise in that scenario is to get another offer.
Thanks for that. Did you go through a promotion process this year? That's really who I'm asking.
I'm wondering why you don't think the point of view that you're getting from hiring/promoting managers is as relevant as the experience of people who got promoted.

Personally, I promoted three people in the last year. I can tell you that there was not a chance for any of them to negotiate their new salary.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by wackeym »

ChiKid24 wrote: Tue Jul 20, 2021 8:43 am Thanks all for the responses. This question is really meant for those that have gotten a promotion this year and whether they've had any leverage in these types of discussions. The job market is super tight right now. Again I know this because we struggled finding and hiring attractive candidates. We even had one person start and leave within 4 months which caused a huge disruption. My boss knows we are understaffed, knows what I can offer, and is giving me the heads up that one is coming. This will be title bump, bonus target bump, equity bump, and I'll be managing more people. Of those, the salary is the only component that isn't set based on the title.

This is negotiable and Id be crazy not to push to maximize it since annually raises only tend to be 2-5%. In my line of work 10% is probably the typical inline level up promotion salary increase. Asking for 20% would be an incremental $25k salary. Given the current market and our experiences looking for candidates in our line of work I believe my boss would find that additional pay a bargain to avoid going through the time and effort of another hiring process.

Lastly this wouldn't be a threat. He and I have a good working relationship and our families spend time together outside of work. This is really to have an open conversation with him so he can advocate for me to HR. He knows there are opportunities available to me outside the company at higher pay if I wanted to jump ship. He's told me in the past to be patient as it wasn't possible until he got promoted (which just happened).

So again, if you've gone through a promotion recently, was it better than what you've experienced in the past? Did you negotiate and ask for more? Did they offer more? Thank you all!
Again how do you know this is negotiable? What is your BATNA if they tell you to pound sand? I understand the job market is right and good candidates are difficult to source, but if you don't have a strong BATNA, what is your realistic move if they tell to you take it or leave it?
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by LadyGeek »

Acronym decoder:

BATNA - Best Alternative To a Negotiated Agreement
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by KlangFool »

ChiKid24 wrote: Mon Jul 19, 2021 10:58 pm
For me bonus target and long term incentive are set by the company based on level.
ChiKid24,

1) First rule of negotiation. Stop limiting yourself. Stop the anchoring bias.

2) Why do you think that the level is set? If they really need you, they could promote you to the same job with a different level.

3) I just started a new job (individual contributor). Within my team, all folks have similar job title. But, we are across 3 different job levels.

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Re: [Getting a promotion, how do I negotiate a raise?]

Post by market timer »

ChiKid24 wrote: Tue Jul 20, 2021 8:50 am
market timer wrote: Tue Jul 20, 2021 8:47 am I haven't seen anything in this thread to indicate this is a negotiation. I think it would not be advisable to propose a 25% target in this scenario. You have no leverage, as far as I can tell. Just be glad to get the recognition, token raise, and possibly higher incentive compensation.

If you are unhappy with your current compensation, I'd suggest discussing with your manager the potential for more performance-based compensation, if what you are doing can be easily translated into profitability. If what you are doing cannot be translated into profitability easily, it will be hard to negotiate for compensation, and you are pretty much left with negotiating for things like working hours, time off, travel, etc. The only way to get a meaningful raise in that scenario is to get another offer.
Thanks for that. Did you go through a promotion process this year? That's really who I'm asking.
Sure, I was involved in many promotions this year as an executive, and have happily promoted many people over the years. The people talking about BATNA have the right idea. I have never seen a negotiation happen at the time of promotion. You can start negotiating for next year, in the form, "If I achieve X, I'd like to get Y." In addition, I highly recommend applying for outside offers, so you can learn your true market value. This is useful if you learn you are underpaid, so you can leave. It can also be useful to learn you are overpaid, so you lose the sense of entitlement. Personally, I have experienced both.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

TomatoTomahto wrote: Tue Jul 20, 2021 8:56 am
I would wonder if having a social relationship outside of work would actually put a damper on your boss’s willingness to go big on a raise. He just got promoted and is probably being observed; last thing I’d do in a situation like that is give a friend a whopping 25% raise.
Interesting take. I don't think it's known that we socialize outside of work, but fair point on him potentially being observed. I think my approach is just to have an honest conversation with him. We both know there are options for me outside the company and that our company has struggled hiring/retaining people in the past. I took his heads up to me as an ask for me to start doing work on my end to support an ask. There is wide range of salary at the level I would be moving up to. He could be trying to get me to find ways to support moving up to the mid/higher end of that range rather than lower end. I think that's why I turned to this forum. To see if others are seeing inflation and tight job market providing a bit more leverage in these negotiations this year.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

KlangFool wrote: Tue Jul 20, 2021 9:15 am
ChiKid24 wrote: Mon Jul 19, 2021 10:58 pm
For me bonus target and long term incentive are set by the company based on level.
ChiKid24,

1) First rule of negotiation. Stop limiting yourself. Stop the anchoring bias.

2) Why do you think that the level is set? If they really need you, they could promote you to the same job with a different level.

3) I just started a new job (individual contributor). Within my team, all folks have similar job title. But, we are across 3 different job levels.

KlangFool
Thanks Klang. Always love your perspective. I was hoping to set the anchoring bias by leading in the discussion before I get the notice that the raise is a 8% increase. I know a lot of people on here say be thankful for anything, and I am that. But you don't get 100% of the things you don't ask for, and I see very little risk in trying to anchor the discussion on the higher end, especially given the unique dynamics of the current labor market.

As for the level, my boss was previously one level above me. That prevented me from being promoted. He is now two levels, so there is an ability to move to the next level. I've hired people at this company and know that there is no adjusting the bonus and equity targets for the levels. So that is why I'm saying it's set. Therefore the only real thing to push for is a higher salaray.

Congrats on going back to work. I saw your other thread and was happy to hear that news for you.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ClevrChico »

wilked wrote: Tue Jul 20, 2021 6:42 am Your 25% will likely get laughed at.

I'd say 5-15% is the expectation for megacorp

The typical way to get higher is to get an external offer and get countered

good luck
100%. I've always found this to be non-negotiable. If it's not what you want, spend a few years gaining experience with the new role, and then leverage that for a better offer elsewhere.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by rage_phish »

I received a promotion from recruiter to sr recruiter last week (stays on the same salary band)

They offered a just under 5% raise. Which I would have taken. But I told them I was expecting 10%. They came back at just under 6% saying that’s as high as they can go. So I happily accepted
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

rage_phish wrote: Tue Jul 20, 2021 11:27 am I received a promotion from recruiter to sr recruiter last week (stays on the same salary band)

They offered a just under 5% raise. Which I would have taken. But I told them I was expecting 10%. They came back at just under 6% saying that’s as high as they can go. So I happily accepted
Thank you. This is the type of data point I'm looking for. Congrats on your promotion and raise.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by ChiKid24 »

market timer wrote: Tue Jul 20, 2021 10:10 am
ChiKid24 wrote: Tue Jul 20, 2021 8:50 am
market timer wrote: Tue Jul 20, 2021 8:47 am I haven't seen anything in this thread to indicate this is a negotiation. I think it would not be advisable to propose a 25% target in this scenario. You have no leverage, as far as I can tell. Just be glad to get the recognition, token raise, and possibly higher incentive compensation.

If you are unhappy with your current compensation, I'd suggest discussing with your manager the potential for more performance-based compensation, if what you are doing can be easily translated into profitability. If what you are doing cannot be translated into profitability easily, it will be hard to negotiate for compensation, and you are pretty much left with negotiating for things like working hours, time off, travel, etc. The only way to get a meaningful raise in that scenario is to get another offer.
Thanks for that. Did you go through a promotion process this year? That's really who I'm asking.
Sure, I was involved in many promotions this year as an executive, and have happily promoted many people over the years. The people talking about BATNA have the right idea. I have never seen a negotiation happen at the time of promotion. You can start negotiating for next year, in the form, "If I achieve X, I'd like to get Y." In addition, I highly recommend applying for outside offers, so you can learn your true market value. This is useful if you learn you are underpaid, so you can leave. It can also be useful to learn you are overpaid, so you lose the sense of entitlement. Personally, I have experienced both.
Thank you. That background is helpful since you've been involved in promotions this year. Interesting that you've never seen negotiations happen at that time though. I've always been able to and my wife just was able to last month (going from 15% raise to 25%). Curious, have your promotion offers been any higher this year vs years past? My hypothesis is inflation and tighter labor market make this year a tougher year to attract and retain talent. That, combined with company's allowing more remote work, makes it easier for me to find a new opportunity. I am currently in the process with two other companies and know the target comp for those roles makes me underpaid. There is value to staying where I am as I have good visibility to c-suite and have worked hard to build up relationships throughout the company. I'm not looking to match an outside offer, just to make it harder for me to jump ship and less likely to keep looking.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Wannaretireearly »

slightly different take, but I've delved into our mega corps salary bands etc.
The 'jump' from Sr. Manager to Director, in the US, is around 15 to 20% at the mid-point. So, assuming you're already well above mid-point in the 'old' role, HR will recommend roughly an adjustment to mid-point in the new role (generally 8 to 15% promo bump, ish). Additional benefits would be roughly 8% extra annual bonus, and I'd say ~30% more RSU's (starting from a pretty low #).

Playing with rough starting numbers: Add this all up, let's sat it's: 20K (salary bump), 20K bonus bump, and $10 to $20k RSU bump = $50 to $60K additional annual comp. After CA taxes this would represent roughly $30 to $40K actual 'after tax' take home.

I'm not gonna say no if it comes my way, but I know a bump like this will increase my stress levels by 50%, for an additional $30 to $40K take home.
Stress will be managing my peers more (cut throat at the Director level), more scrutiny in 'what i do' from Execs, and more chance of being cut during annual review, reorg, layoff time (seen this so many times, including with friends).

Now, my research in non-US geos shows, major salary bumps at the mid-point in Asia! Roughly 50% difference between the same levels (compared to 15% to 20% I indicated above). So, the financial incentive to go up a level is much, much higher.

Gotta love MegaCorp HR ;) It's all a game about keeping sane for us peons, keep plugging along with some good WLB IMO, take whatever promos you get with a healthy pinch of reality salt.

Good luck OP - no harm trying for sure!
Last edited by Wannaretireearly on Tue Jul 20, 2021 11:53 am, edited 1 time in total.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by 8foot7 »

When I promote, I promote to a little less than the midpoint of the new salary band for the promotee. But I present it as, "congratulations, you're now X and your pay has been increased by Y to $Z per year with an additional bonus component."

As I've posted in another thread, I generally make my best offers up front and while I don't generally mind someone attempting to counter my offer once, I generally do not actually entertain it.

If I'm taking an employee from $85,000 to $115,000, and they came back and said, "actually I'd like $125,000," I'd let them know that we were firm on the 115 and the details of the package, and excited to see where the new role would take them and the company and, as a direct result, their future comp. And I would expect the conversation to end there; further attempts would not be welcomed and to be frank it would stick out in my mind as a negative.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Dyloot »

Jags4186 wrote: Tue Jul 20, 2021 8:10 am I received a 7.5% raise for a promotion at my Megacorp in December. This was mid cycle, i.e. 4 months after company wide raises were handed out where I had received a 4.5% raise. I received no increase in bonus incentive, other than it was based on a percent of my new, higher salary.

I also wasn’t given a heads up…I was called out of the blue by my manager and said “hey we’re making you X and you’ll be getting a Y raise.” Which caught me off guard and took away any real possibility for negotiation. I asked about changing the bonus structure but that was met with a “I’ll look into it” and then it was never spoken about again.
I received roughly an 8% raise for a level-bump (same responsibilities, better title) last week. I knew it was coming. There was never an invitation nor a real opportunity to negotiate.

As has been mentioned by others above, it was presented: "congratulations, I really appreciate your hard work and we're promoting you. You're getting a title bump and getting a Y raise."

Honestly, I was happy with the compensation before the promotion, and with it now after. Would I like to make more? Yes. Did I dream of that 25% bump? Yes!

Did that happen? No! I wouldn't even say I was disappointed--it was expected, and I appreciated my boss for getting me that promotion.

To be honest, I was mostly thrilled to get the raise in July--just a couple months after my annual raise, and in time to make me eligible for next year's annual raise. I've worked for other companies that promoted before the annual review time and skipped the annual raises for those who had just received their own pay bump. I see my manager being savvy enough to get me that promotion during the right period of time to maximize my raises, and I appreciate him for doing so.
Dyloot
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Dyloot »

8foot7 wrote: Tue Jul 20, 2021 11:45 am When I promote, I promote to a little less than the midpoint of the new salary band for the promotee. But I present it as, "congratulations, you're now X and your pay has been increased by Y to $Z per year with an additional bonus component."

As I've posted in another thread, I generally make my best offers up front and while I don't generally mind someone attempting to counter my offer once, I generally do not actually entertain it.

If I'm taking an employee from $85,000 to $115,000, and they came back and said, "actually I'd like $125,000," I'd let them know that we were firm on the 115 and the details of the package, and excited to see where the new role would take them and the company and, as a direct result, their future comp. And I would expect the conversation to end there; further attempts would not be welcomed and to be frank it would stick out in my mind as a negative.
I really enjoy your posts on these topics. So many of us wander around blindly early in our career not understanding how company compensation works and what we can expect and not expect in megacorps. We bring definite value to these threads when you share your own approaches and experiences.
KlangFool
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by KlangFool »

OP,

Do not know how useful is this to you.

A) I was laid off my ex-employer last year.

B) My peers that were retained by employers got a higher than normal pay raise. It was not a merit pay raise and the employer is not doing well.

C) So, it seems like we are not in a normal job market environment now.

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danbdzs
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by danbdzs »

This is an interesting situation. I think I'm in a similar one.

I'm applying for a transfer to the US that also includes a level promotion in MediumCorp.
Currently based in Latin America. I'm in the internal application process, but expecting to get an offer within the next 1-2 months. The hiring manager has let me know he's giving me the position and only needs to run the process with HR.

In terms of compensation, I'm probably getting a raise in absolute terms, however PPP adjusted is probably not so clear. HR may try to spin it as "look at this huge raise" comparing absolute TC only, and give me the lowest possible salary for the new level (in the US standard). I'm contemplating in giving a counter offer, with objective evidence (if there's such a thing) of the value of the position, i.e. surveys from other ppl in the same position in the US (within the company) and online data. I'm amazed at the amount of information online on compensation in the US labour market. This level of "transparency" is something you don't find in Latin America.

I've seen up thread that at the time of the promotion is too late to be negotiating. I'm curious, is there an ideal time to bring this up? I'm thinking in doing it with the hiring manager and as a response to the official offer. Then he would take it to HR.
In your experience would there be an optimal way to approach this?

Thanks,
Dan
EnerJi
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by EnerJi »

danbdzs wrote: Tue Jul 20, 2021 5:08 pm This is an interesting situation. I think I'm in a similar one.

I'm applying for a transfer to the US that also includes a level promotion in MediumCorp.
Currently based in Latin America. I'm in the internal application process, but expecting to get an offer within the next 1-2 months. The hiring manager has let me know he's giving me the position and only needs to run the process with HR.

In terms of compensation, I'm probably getting a raise in absolute terms, however PPP adjusted is probably not so clear. HR may try to spin it as "look at this huge raise" comparing absolute TC only, and give me the lowest possible salary for the new level (in the US standard).
Is this a US-based company, and are you going to be on a work visa of some kind? For H1B (and possibly other visa classifications as well), you must be paid the "wage rate your employer pays other workers with similar experience and qualifications, or the local prevailing wage for the occupation in the area of intended employment, whichever is higher."
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danbdzs
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by danbdzs »

EnerJi wrote: Tue Jul 20, 2021 5:15 pm
danbdzs wrote: Tue Jul 20, 2021 5:08 pm
In terms of compensation, I'm probably getting a raise in absolute terms, however PPP adjusted is probably not so clear. HR may try to spin it as "look at this huge raise" comparing absolute TC only, and give me the lowest possible salary for the new level (in the US standard).
Is this a US-based company, and are you going to be on a work visa of some kind? For H1B (and possibly other visa classifications as well), you must be paid the "wage rate your employer pays other workers with similar experience and qualifications, or the local prevailing wage for the occupation in the area of intended employment, whichever is higher."
Yes, it's a US-based company and I think I would be on a H-type working visa.

"Whichever is higher" o wow, that is interesting, thanks for the response.
KlangFool
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by KlangFool »

danbdzs wrote: Tue Jul 20, 2021 5:20 pm
EnerJi wrote: Tue Jul 20, 2021 5:15 pm
danbdzs wrote: Tue Jul 20, 2021 5:08 pm
In terms of compensation, I'm probably getting a raise in absolute terms, however PPP adjusted is probably not so clear. HR may try to spin it as "look at this huge raise" comparing absolute TC only, and give me the lowest possible salary for the new level (in the US standard).
Is this a US-based company, and are you going to be on a work visa of some kind? For H1B (and possibly other visa classifications as well), you must be paid the "wage rate your employer pays other workers with similar experience and qualifications, or the local prevailing wage for the occupation in the area of intended employment, whichever is higher."
Yes, it's a US-based company and I think I would be on a H-type working visa.

"Whichever is higher" o wow, that is interesting, thanks for the response.
danbdzs,

US H1B salary is a publicly disclosed information. So, if you google search, "H1B Salary <job title> <Employer>", you would find the historical information. And, if your employer is too small, you can google on the job title only or the bigger employer.

Information is power.

<<Yes, it's a US-based company and I think I would be on a H-type working visa. >>

If you transferring from a US company subsidiary to US, it is probably an L1 visa.

https://en.wikipedia.org/wiki/L-1_visa

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scottgekko
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by scottgekko »

I was recently promoted and the team I'm responsible for increased from ~25 to ~100. I received a 10% increase in base, and therefore a 10% increase in bonus dollars as our bonus is paid as a % of base. It was presented to me as "here is your new opportunity, your new title is x, your new salary is y". There wasn't any negotiation and, although I have a great relationship with my superiors, it would've been an odd conversation to ask for more....
KlangFool
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by KlangFool »

scottgekko wrote: Tue Jul 20, 2021 7:29 pm
I was recently promoted and the team I'm responsible for increased from ~25 to ~100. I received a 10% increase in base, and therefore a 10% increase in bonus dollars as our bonus is paid as a % of base. It was presented to me as "here is your new opportunity, your new title is x, your new salary is y". There wasn't any negotiation and, although I have a great relationship with my superiors, it would've been an odd conversation to ask for more....
scottgekko,

Why? You are in the business of exchanging your time for money. The employer is in the business in leveraging your effort to make money. They increased your work load by 2X to 4X and pay you 10% to 20% extra. They are getting a great deal!

If you don't ask, you don't get. And, when you are too old to handle the work load, it is time to replace you with a younger and cheaper version.

KlangFool
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by carguyny »

I've promoted many people of my career (think of me as a C-level executive and Board Member). I've never had one person try to negotiate the comp change as part of it. Come to think of it, I've never had any try to negotiate a year on year comp raise. They trust my judgement and know I've put a lot of thought into it and gotten support from the various stakeholders.

I don't have a typical range of salary increase on promotion as it is very employee specific. If someone is doing a great job and getting promoted vs being overdue for promotion and only just limping over the line. We also use salary survey data to factor in what market changes are out there and where people stand - you might be able to get a hold of that for your industry.

Honestly, I would probably be very aggravated if someone tried to negotiate it with me.
bayareaBH
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by bayareaBH »

Got an in role promotion this winter (Ie better title but no real change in day to day responsibilities).

Received modest salary bump (+5%), but total bonus/stock target went from ~35% of my annual salary to 60%. Would rather have the increase in salary, but in the eight years I’ve worked here, they’ve paid the full target amount every year (even after missing 2020 revenue targets due to covid), so it’s pretty much a sure bet as anything is these days.

Didn’t try to negotiate, as this is a mega Corp with pretty tight pay bands and I can see in our internal data that the new salary is 1-2% lower than the midpoint of the band so it seemed good enough.
Normchad
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Normchad »

carguyny wrote: Tue Jul 20, 2021 8:05 pm I've promoted many people of my career (think of me as a C-level executive and Board Member). I've never had one person try to negotiate the comp change as part of it. Come to think of it, I've never had any try to negotiate a year on year comp raise. They trust my judgement and know I've put a lot of thought into it and gotten support from the various stakeholders.

I don't have a typical range of salary increase on promotion as it is very employee specific. If someone is doing a great job and getting promoted vs being overdue for promotion and only just limping over the line. We also use salary survey data to factor in what market changes are out there and where people stand - you might be able to get a hold of that for your industry.

Honestly, I would probably be very aggravated if someone tried to negotiate it with me.
Me too! If I promote you and give you an opportunity to advance, and you try to negotiated, I’d be agitated. At the time of promotion, for the new role, you are literally the worst person in the company at that role. Prove yourself and the money will come…..

More holistically, we also use salary comp data to make sure people are appropriately compensated.

Some of our folks are awesome, and get paid a lot more than the rest; this is maybe our top 30%. For the other folks, we like them too, we don’t want them to leave. But if they leave, we aren’t crushed by that. It’s a calculated risk we take.

So when it comes to compensation, it gets difficult to make sense of it.
EnerJi
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by EnerJi »

KlangFool wrote: Tue Jul 20, 2021 7:53 pm
scottgekko wrote: Tue Jul 20, 2021 7:29 pm
I was recently promoted and the team I'm responsible for increased from ~25 to ~100. I received a 10% increase in base, and therefore a 10% increase in bonus dollars as our bonus is paid as a % of base. It was presented to me as "here is your new opportunity, your new title is x, your new salary is y". There wasn't any negotiation and, although I have a great relationship with my superiors, it would've been an odd conversation to ask for more....
scottgekko,

Why? You are in the business of exchanging your time for money. The employer is in the business in leveraging your effort to make money. They increased your work load by 2X to 4X and pay you 10% to 20% extra. They are getting a great deal!

If you don't ask, you don't get. And, when you are too old to handle the work load, it is time to replace you with a younger and cheaper version.

KlangFool
In this specific case, I agree that it might have been appropriate to gently query the 10% increase. Going from being responsible for 25 people to 100 is a huge increase in responsibility and that seems out of line with a 10% increase in salary unless you were extremely highly paid in the previous position.
Afty
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Afty »

I’ll also chime in and say that I promoted a number of people and never had anyone try to negotiate their raise with me. I never heard of it happening to any other manager either (we had an email list for all managers — thousands of members — where we would discuss such things).
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TomatoTomahto
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by TomatoTomahto »

KlangFool wrote: Tue Jul 20, 2021 7:53 pm
scottgekko wrote: Tue Jul 20, 2021 7:29 pm
I was recently promoted and the team I'm responsible for increased from ~25 to ~100. I received a 10% increase in base, and therefore a 10% increase in bonus dollars as our bonus is paid as a % of base. It was presented to me as "here is your new opportunity, your new title is x, your new salary is y". There wasn't any negotiation and, although I have a great relationship with my superiors, it would've been an odd conversation to ask for more....
scottgekko,

Why? You are in the business of exchanging your time for money. The employer is in the business in leveraging your effort to make money. They increased your work load by 2X to 4X and pay you 10% to 20% extra. They are getting a great deal!

If you don't ask, you don't get. And, when you are too old to handle the work load, it is time to replace you with a younger and cheaper version.

KlangFool
I think that perhaps, if you think that going from 25 to 100 people means a 2x to 4x increase in work load, you either never experienced it or had a very inefficient organization. You became accountable for 4x as many people but that shouldn’t translate to a corresponding increase in work.
I get the FI part but not the RE part of FIRE.
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8foot7
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by 8foot7 »

Dyloot wrote: Tue Jul 20, 2021 2:56 pm
8foot7 wrote: Tue Jul 20, 2021 11:45 am When I promote, I promote to a little less than the midpoint of the new salary band for the promotee. But I present it as, "congratulations, you're now X and your pay has been increased by Y to $Z per year with an additional bonus component."

As I've posted in another thread, I generally make my best offers up front and while I don't generally mind someone attempting to counter my offer once, I generally do not actually entertain it.

If I'm taking an employee from $85,000 to $115,000, and they came back and said, "actually I'd like $125,000," I'd let them know that we were firm on the 115 and the details of the package, and excited to see where the new role would take them and the company and, as a direct result, their future comp. And I would expect the conversation to end there; further attempts would not be welcomed and to be frank it would stick out in my mind as a negative.
I really enjoy your posts on these topics. So many of us wander around blindly early in our career not understanding how company compensation works and what we can expect and not expect in megacorps. We bring definite value to these threads when you share your own approaches and experiences.
Thanks for the kind words. Happy to share my experiences and practices, and there are so many others who do the same and I appreciate them as well.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Jags4186 »

What I find interesting on here is that people managers, even anonymously on this forum, seem to discourage or claim it is incredibly difficult to increase comp beyond what is being graciously given to you by the organization. And I don’t doubt this is true for the majority of people. What I’m curious about are the superstars who end up being their manager’s boss a several years down the line. How does one position themselves for that, or does that really not happen without leaving and returning at a higher level.

I also think there is a big difference between revenue generators and cost reducers. If you are a revenue generating employee, you are likely much more likely to be able to jockey for more than if you are a cost reducer. Someone who brings an additional $1,000,000 in revenue is always rewarded more than someone who figures out how to save $1,000,000 in expenses.
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TomatoTomahto
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by TomatoTomahto »

Jags4186 wrote: Wed Jul 21, 2021 8:40 am Someone who brings an additional $1,000,000 in revenue is always rewarded more than someone who figures out how to save $1,000,000 in expenses.
Not if the saves are recurring and the revenue isn’t. That’s not an unusual situation.
I get the FI part but not the RE part of FIRE.
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Re: [Getting a promotion, how do I negotiate a raise?]

Post by Dottie57 »

TomatoTomahto wrote: Wed Jul 21, 2021 9:06 am
Jags4186 wrote: Wed Jul 21, 2021 8:40 am Someone who brings an additional $1,000,000 in revenue is always rewarded more than someone who figures out how to save $1,000,000 in expenses.
Not if the saves are recurring and the revenue isn’t. That’s not an unusual situation.
+1-
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