Responses to 3 Classic Pay Negotiation NOs

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Very few women enjoy the idea of beginning a pay raise discussion.  Especially when you realize that you should expect to hear at least one NO on your way to earning more money. I can’t promise that you will look forward to the negotiation after you read this post but knowing how to counter a few of the classic responses will make the salary negotiation much less nerve-racking.

Here are three various ways management will say NO when you are looking to earn more and responses that will get you quickly past these objections.

We Can’t Afford to Pay You More

It must be in the manager handbook because this is typically the first response one receives when negotiating a raise, salary adjustment, or starting salary.  This might be true but more often it is not.

Be prepared for this by researching the company’s finances before you begin the salary negotiation dance.  Public companies and non-profit organizations are the easiest to research.  Both need to file financial reports annually that become public.  Governmental offices in theory should be easy since a town, city, state, or the federal government approves their funding.  Yet in the past few years we have seen how ill functioning government and budgets can be.  Start by searching the web site of the organization and then move upstream until you discover the financial information you need.   Private companies are the toughest since the financial information is private.  There are many clues though.  The company’s web site may have an investor’s section and press releases about new products, clients, and contracts.   Periodic company meetings probably include statements from the VP of Sales discussing the growth of the client base and the VP of Finance/Accounting discussing the solid financial footing of the company.  Take notes at such meetings.

When researching look for the trend of revenue, net profit, and liquid asset growth and a decrease in costs.  Have one or two bullet points at the ready such as “That seems odd since the company’s revenue has increase by more the $2 million the past 2 years” or “There must be some money since the company continues to decrease costs by 10% for the past 3 years.”  The fact that you are informed will shock your manager and make him/her realize that this employee will not accept canned excuses.

You Already Make the Most in the Department

This is another automatic response.  I estimate 80% of the people who I ask have been told this at least once in their life.  How can that be? The math doesn’t add up.  The beauty about this response is that you can’t confirm it if you have signed a salary confidentiality agreement and more than 62% of women who work in the private sector have.

A good response to such a comment is to jujitsu it as the red herring it is by saying something like “The ranking of my pay internally isn’t the issue.  The issue actually is that I am underpaid based on industry standards for the work that I am doing and the value the company is getting from it.”

All the money budgeted for raises have been allocated AND You will need to wait for the annual raises for a change.

Most likely you are looking for more than a 3% pay increase that was the median for 2012.  Say you are looking for a salary adjustment instead of a raise because it can open a new portion of the company’s money and enable off-cycle pay increases.  A salary adjustment can happen at any time of year. A salary adjustment is truly stating that your pay is no longer in the acceptable range for the job and needs to be adjusted upwards.   This may occur because you were hired during a bad economy and your annual raises have not grown as fast as the economy.  Many people who were hired in 2009 at the height of the housing/recession/unemployment crisis may be in this situation.  For example the median income for web designers in 2009 was $54,000 and in 2012 it was $61,417.  That’s a 13.7% increase over the three years.  Allowing for the typical 3% increase each of those three years would bring a web designer $2,400 short to just keep equal with the median salary.  That does not even represent any pay increases that you should have earned as a more senior and improved web designer.

Practice these responses so they will roll off your tongue confidently and you will be well on your way to that justly deserved raise.

10 Things to Know Before You Talk Salary

You have rewritten and proofed your resume and cover letter a million times. You run interview questions and answers throughout the day. You are ready to go get your new job. Or are you? Have you thought about the salary and how you will negotiate it? Here are ten things to know before you talk salary. These work for starting salaries and raises.

1. You are underpaid if you accepted the first salary offered to you. Hiring managers expect negotiations so they keep some money aside specifically for that purpose. This money already has been budgeted. Will you be able to get it or will your manager have the opportunity to use it elsewhere? Next time try before you accept the job offer.

2. It is almost impossible for a woman to ask for too much. Research shows that women continually underestimate their value. It’s also shown that men typically ask for 30% more money than women in salary negotiations. Even when you think you are pricing yourself out by asking for too much, chances are very high that you have not.

3. The market value of the job for men is different than the salary ranges shown on career web sites. The salary ranges consider salaries earned by men and women. Acknowledging the fact that women are earning 77% of what men earn means we want to aim for what the men earn in a given job – not the amount that men and women are earning on average. This means a little math. Divide the target salary by 0.885 and you will get the salary men earn assuming a 50/50 split of men and women in the industry.

4. The financial strength of the company is important to women when we negotiate. We ladies are an empathetic bunch and we wouldn’t want to ask for something that would be hard for our managers to do. Really we think that way even when we know the job should pay more. To help you feel more than comfortable do some extra research before you talk salary with your current manager or hiring manager. Public companies report their finances with the SEC. Private companies have many hints at their success through the press releases, company meetings, and sales growth. Sales representatives can give great insight on this topic.

5. The company’s future strategies are more important than today’s tactics. Sure you are doing a specific job today but you need to understand how the company will change. Oh, did I forget to tell you that your company would change? If it doesn’t it will most likely die so be ready for change. Ask about the future of the company. Do you have skill sets and experiences that will continue to be an asset with future strategies? Do you have skill sets and experiences that have not been used yet at this company but will be critical with new strategies? Can you learn new skills that will make you more valuable with the company’s future? Make sure management understands how you are ready to grow with the company and welcome the changes.

6. The network you bring to the company can be invaluable. Harvard people are worth so much more than we mere mortals not because of their brains. It’s their connections that truly are above and beyond the norm. You have a network of friends, family, classmates, colleagues, and others who may become clients, employees, partners, vendors, advisors, or investors of your company. Let your company be aware of how you are developing your network and using it with the company’s needs in mind. When possible use specific examples of people you have brought into your company’s world.

7. Awards and accolades your have earned are objective and subjective proof of your abilities. Current and former employers, industry organizations, and educational institutes often give various accolades. Make sure your superiors are aware of all that you have earned. Don’t be shocked if you have to remind your manager of an award granted from him/her. Don’t be shocked if you forget what you earned. Keep a “Atta Girl” file with emails and notes from superiors, clients, and others that praise you for work well done. Even save digital copies of voice mail that praise you. Of course, don’t forget any actual awards. Now the most important part, share this information freely with management.

8. Your contribution to increase revenues is important. If you are not in sales this one may seem hard but the more you can put a dollar figure to your contribution the better you will be able to negotiate. Did you help sales representatives pull information for a new client? Did you come up with a product idea? Did you come up with a new market to target? Do you think of a new advertising channel? Did your introduce a new client to your company? Once you can pinpoint a direct impact on revenue than put a dollar figure on it. It’s amazing how easy it becomes to ask for $10,000 more in salary when you can demonstrate that you impacted $50,000 coming into a company.

9. Your contribution to decrease costs is important. Chances are high that if you do not impact revenue than you probably impact costs. Did you negotiate a better contract with a vendor? Did you develop a shorter production method? Did you improve customer service best practices so that fewer customers need additional assistance? If it saved time, it saved money. If it lowered the number of times people needed to interact, it saved money. If it lowered the amount of inventory needed, it saved money. Again putting a dollar figure on this and sharing with managment is the ultimate goal.

10. Your options if you cannot negotiate the salary you want. Too often we feel like we need to take what is given us especially during bad economic times. Understand how well you can survive and thrive elsewhere prior to having a salary discussion with your current manager or a hiring manager. It’s amazing how this knowledge gives you confidence. If you talk to your current manager, the worse that could happen is that you are still employed with the same salary. You may decide that you will begin to look for a new job if you cannot negotiate a better salary but that doesn’t mean you need to say “I’m quitting.” If you are talking to a hiring manager and are currently employed, again you can stay with your current job at the current salary and continue your job search until the right job at the right salary happens. If you are unemployed and talking with a hiring manager the best alternative is harder to come by. Sometimes, knowing that you are taking a job for the short term to keep a roof over your head is the needed step. Just knowing this can give you the freedom to then continue job searching even after accepting a job offer.

Good luck with your next salary negotiation. You should find it easier if you consider the 10 items above.

The Question of Salary vs Flexibility

TelecommutingLast week I found myself attending a conference.  I talked with two mothers who work outside of the home during a break and was awestruck when one of them stated; “Next time, I’m going to negotiate flexibility instead of salary.”  I completely understand the need to be flexible as work hours overlap into home life and family needs bleed into the workday.   Heck, I’m single and I have to deal with it.  Add a spouse and a few children and the overlap becomes a daunting challenge.  No wonder 42% of working adults (both men and women) are willing to be paid less for more flexibility at work.   But I’m struck with the assumption that we can have one but not both.  I believe a much better way to think of flexibility and work is to change the statement to “Next time, I’m going to negotiate flexibility and my salary.“

Flexibility Benefits Employee and Employer

Am I insane to dare recommend this as a goal?  I don’t think so.  Not when you realize that some flex items employees want are the same that employers want. Research done by the Work and Family Institute in 2009 shows that while 77% of companies surveyed have taken cost savings step during the recession 81% of companies maintained and 13% increased their flexible workplace options.  One example is that 19% of companies have added or increased telecommuting to save on the cost of office space.

Asking for such benefits would be considered a win/win since both parties want the same thing.  They may want them for completely different reasons but they both want it.  A working mom may look at working virtually from home as a means to save 2 hours of commuter time per day which allows her to take her children to school in the morning or meet her children at the bus stop in the afternoon, or to still work a full day when a child is off from school.   A company may want to increase virtual workers to lease smaller or less centrally located space at a cost savings.  Thus if telecommuting is what you want there is no automatic reason to decrease your salary goals.  Let your employer inform you why such a request would be a burden to the company before you assume it is a burden.  In many cases it will be a welcome request.

Recently this year’s top Working Mother 100 Best Companies was announced.  The details of each company and why it made the list is very enlightening.  It helps you see what companies can do for its employees.  More importantly it may hit you that there is a reason certain benefits appear over and over again.  The companies get some financial gain (cost savings, revenue generation, minimize employee turnover) from having them.  Or you may be pleasantly surprised to see that your employer is on the list and there are more benefits available to you than you realized.

Hopefully, you will agree that you can negotiate flexibility and salary, even in this economy.

© Copyright 2011, Katie Donovan. All rights reserved. Reproduction without explicit permission is prohibited

Free Agency is Not Just for Athletes Anymore

Allegiance to Family and Self

“We work hard and we play even harder.”  Ever hear that expression when interviewing for a job? To me that creates an automatic pass from me.  The reason is that I put myself ahead of the company and that expression is code for putting the company first.  I know it may seem selfish to state that I put myself first.  I also put my family and my friends before a company.  You may have similar priorities than I.  You may not.    If you do put the company first and have been laid off than you have experienced the great shock of the reality that it was unrequited love.

Recently I watched an intriguing video regarding thoughts on how to fix the US economy.  Within the video was the comment from the Carl Camden, the CEO of Kelly Services, that 25% of the US workforce are “free agents” and within the next decade 50% of the workforce would be free agents.

Free Agency = More Responsibility

Long gone are the days that a person would graduate high school and get a job that could last until their retirement.  The classic retirement gold watch is not waiting for any of us. Although you may have great relationships with management, their responsibility is to the investors and the company as a whole.  Decisions will be made that ensure investors will reap good returns and that the company will survive and thrive.  These decisions can and will include layoffs from time to time.  Thinking that your job can be gone at any time initially may be frightening but I am going to argue that it is inspiring.   It can inspire us to keep learning and staying marketable.

Staying Marketable

What additional training can you take that is new to your industry?  Experienced marketers have not been formally trained in Internet marketing until recently.  The marketer who has kept ahead of changes to her industry went to conferences and seminars, and took courses on the topic.  Her colleagues who have not are most likely on the unemployment line and taking those courses now to reenter the marketing profession.    What changes are going on in your industry that you should learn more about?  What new job/industry do you want to learn especially if it is one that builds on your current experience?  The job you have today may not exist tomorrow.  Or may be greatly diminished in size.  Ask bank tellers and travel agents if their jobs are at the same volume as in the 1990s.


It is estimated that a new college grad will have 7- 10 jobs within her career.  Assuming you will work for 40 years than you can estimate each job will last 4-6 years.  So it’s not as if you have to be in training all 40 years of your career but you do need to be listening and learning to the outside world.  Don’t become the next casualty because you didn’t realize your industry was a dying one.   If you had worked for a typewriting company in the 1970s, would you have been ready for the demand for personal computers in the 80s and 90s that created the demise of your industry?  Or would you have been shocked when you lost your job as the lights were being turned off at your company? If you work in the landline telephone industry would you be one of the workers who recently went on strike asking for job security.  The strike proved unsuccessful as union workers went back to work without a new contract.  The reality of shrinking landline demand must have hit home. Instead of seeking job security, the union would serve its members much better if it worked out a proactive retraining program that prepares members for the inevitable decrease in workforce instead of the standard reactive retraining which typically occurs after a layoff.   You won’t wait for the company or the union to figure out how to help you if you have a free-agency mindset.  You will be looking for better opportunities periodically to make sure you are taking care of yourself and your family.

Negotiating and Free Agency

The monetary lose you will experience by not negotiating your salary will rarely be replenished because you sacrificed for your current employer or gave up another opportunity or waited for the company to be fair to you.  With the free-agency mindset,  you will take every opportunity to earn what the work is worth and provide the work to your employer.

Do you feel more daring to negotiate now that you know that no job is permanent and you know your priority is not the company but your family and yourself?

© Copyright 2011, Katie Donovan. All rights reserved. Reproduction without explicit permission is prohibited