Whether looking for a job or seeking a raise, what is the best way to conduct salary negotiations, a situation many find uncomfortable? One of the ways to overcome its awkwardness is to be well prepared.
The first step is certainly to be well informed about the job and the company. In fact, salaries can vary as a function of the region or industry or the size or financial situation of the company. The type of position, number of years of experience required and level of responsibility are also major components.
Then it is important to check out the current situation on the market. Our annual survey of engineers’ remuneration will come in handy in determining salaries as a function of job and company characteristics. We show the data in the form of averages, quartiles, deciles and standard deviations, providing information on the salary range.
Third, answer the question “How much are my skills worth?” This helps find where you fit on the salary scales. You should evaluate your potential with respect to the job you want and the company’s context. How fully do you satisfy the job’s requirements? How long will it take before you can work autonomously? Do you have expertise that is highly specialized or in high demand in the company’s sector of activity? Do you have abilities that, without being required, represent an asset for the company, such as proficiency of a third language or knowledge of software or a management system?
The question of your salary expectations is often asked at the end of the first interview, sometimes during a telephone conversation. If you have already thought about the job, the company and your qualifications, you have the right elements for answering the question. Set a range and present your expectations in a way that can lead to future negotiations when you know more about the position.
When you receive a job offer is when you are really in a position to negotiate. You need to prepare arguments that will justify your demands. Some companies have little flexibility in setting a salary but can offer bonuses and benefits, such as insurance, pension plans, training programs, flexible hours, telecommuting, possibilities of promotions, etc. These elements are added to the salary offer and must be taken into consideration.
For an engineer starting out, it is more often a matter of salary discussion than negotiation. It is still important to know the salary scales in order to be able to answer the question of your expectations. You should realize that most of the time, work experience acquired before you earned your degree will not be considered in calculating your experience.
For a first job, there are also options like a salary review after six months or the possibility of working on varied projects.
Some organizations have annual reviews, and this is a very good time to ask for a raise. When objectives were set the previous year, how much has been achieved is a very good starting point for discussing a raise.
Other companies do not have annual reviews and do not clearly establish objectives. In that case, you have to find opportunities to bring up the subject, such as the anniversary of your hiring date, the end of an important project, or when the company announces good results.
Whatever the case, you must prepare for this meeting. Take the time to go back over your achievements and their effects on the company: increased productivity or quality, cost reductions, technological innovations, etc. To the extent possible, attach a figure to your achievements.
How much should you ask for? Every year, remuneration consulting companies conduct surveys to find out the average increases companies will be giving their employees(1). This information and your knowledge of the company’s policies should enable you to determine a realistic salary increase for your sector. Negotiating a bonus, in recognition of a special effort or achievement, can also be a solution worth exploring.
When new responsibilities are assigned or you find yourself with an overload of work are situations that are also suitable for asking for a raise. Do the new responsibilities change the nature of your job? Is the work overload temporary or permanent? If the nature of the position has changed, it would be wise to check the corresponding salaries in the market and start the negotiation by establishing that the new assignments change your role in the company. If the change is temporary, the possibility of a bonus could be discussed.
Remuneration is a sensitive subject. Discussions can be better facilitated if they are based on facts, like the salaries granted in a comparable sector and specific accomplishments. It is also important to take into account the company’s capacity to pay and its internal policies.
The discussions should occur in a context of openness and be marked by a desire to find an arrangement that satisfies both parties.
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(1) Every year in December, the career service publishes a summary of the forecasts of salary increases for the coming year.