Why and how to negotiate a fair salary
Negotiating a fair salary is relevant for anyone, but given it’s Women’s Day, I want to focus on why it’s even more important for women. Women rarely get the same opportunities as men do. When they do, they usually earn less than men for the same work. There are numerous studies to support these statements; everyone I spoke to admits to having seen these gender biases, if not being party to them. Yet, women world over continue to struggle. When they do raise their voices, they are called aggressive, spoilt brats, or just not liked. Ask Sheryl Sandberg, Jennifer Lawrence or that girl who wrote the open letter to her CEO.
Breaking the gender bias needs groundswell support
I admit, I hadn’t bothered to even find out whether I got paid the same as male colleagues throughout my 20-odd year career. But I will definitely try to in the future, because I have realised how deep the bias against women runs and that I can do something about it.
A recent World Economic Forum article quoted a study showing male undergraduate students assuming their male classmates knew more about the course material than female students, even if the young women earned better grades. Ignoring female talent at that age can add up in the long run, as these students grow up and make hiring and evaluation decisions. Wrote the researchers: “Our work implies that the chilly environment for women may not be going away any time soon.”
It’s not just men who discriminate. Women suffer from “imposter syndrome” themselves, feeling like frauds when it comes to talking about their expertise or success. So there are unconscious biases by both men and women that works against women.
While corporate feminism is one way to highlight the problem (though I am amused by the number of women’s day initiatives just to look good), we need to move to solutions. We could make small design changes to environments rather than mindsets, especially around interviews and evaluations, according to some recent research. In this context, it’s important we speak up in favour of fair salaries.
What’s fair? What are you worth?
The next obvious question is what’s fair. Everyone thinks they’re cat’s whiskers. Well, men do. As already pointed out, women tend to underestimate their own skill set. So it’s even more important to get a feel for what someone with your skill set and experience is earning. Given that it’s taboo to discuss salaries in social settings, the easiest way to get a feel for this is through recruiters.
If you’re already happy in a job, it’s worth having a conversation with your manager about what would make you more valuable to the firm. You could also explore whether your skill-set can be leveraged better in another job or industry.
Jobs have salary ranges based on corporate strategy and candidate quality
While candidates focus on themselves, the more important factor for a given job is that job’s salary range. Whether it’s for an administrative assistant, or for the lead role in a Hollywood movie, the job itself has a list of duties and responsibilities, which in turn lead to the skill (or indeed look) requirements. Obviously, a niche skill or huge responsibility will pay more. The higher in the firm or project you are, the more your salary is tied to its size.
The job’s salary is usually based on hard data from actual salaries paid in the industry, and the company’s strategy of what kind of paymasters they want to be relative to the industry. It’s a trade-off between salary and other benefits such as brand. The range around the job’s salary reflects room to rank candidates on perceived quality – companies assess candidates not only on current skills but potential to be in leadership roles.
You could try to access this market intelligence on salary ranges during your appraisals, as your HR manager would have bought this salary survey data from HR consulting firms.
Actual negotiation should be a formality
Once you have done your research on both these – what you are worth and what the job is worth – you can go into a negotiation with a clearer idea about what you want to achieve.
One tip I read in salary negotiating book very early in life was to always ask for an offer; don’t go first. When asked about salary expectations, I give the standard reply of “I am sure you will make a reasonable offer once we establish a fit between your requirements and my skill set.”
I also never tell them my current salary, even if they ask. I know this is controversial because in markets like India, it’s common for recruiters and prospective employers to ask candidates their current salary. Their rationale is that this gives them a feel for your experience level; personally I think it’s their job to assess whether you are a right fit for the requirements they have and they have various ways they can do this. Apart from asking your salary expectations, they meet you multiple times, they look at your qualifications, they do reference checks.
Some senior HR and business leaders agree with my approach about sticking to discussing expectations rather than current salaries. A word of caution though – you’re in a better position to do this if you get approached rather than you being desperate for a job.
Once you get an offer, you need to assess whether it’s worth negotiating. If it’s too far below your expectations, you didn’t do your homework right on the salary range for the job. I find it’s best to pass on the job. On the other hand, if the offer is much higher than expectation, it’s also cause for concern. Have they misunderstood your skills? If you’re not sure you can deliver according to their expectations, you might get fired anyway which will look worse on your profile.
Only if the offer is in ballpark of your expectations, is it worth negotiating. There is usually some room on the monetary side but if you find you hit resistance point, you can negotiate on non-monetary benefits such as designation, time/work-from-home flexibility, vacations, perks in some countries (car, school fees, home etc).
So summing up, whether I was being considered for a CEO role or being cast in a Hollywood movie, I would first ensure that I was the best I can be, and ideally the best they can find. I would want to know the company’s revenue, the salary range for the job, and what it takes to be at the top end of the range before I go into a negotiating discussion. In my experience, prospective employers respect candidates who not only do their research but also structure their conversations logically around the research and ask for a fair bargain.
All said and done, you need to be happy with the outcome. If you start a job with the feeling that you’re not getting paid what you are worth, you are likely to not give it your best, which in turn will hurt you in the long term. Writing an open letter may have worked for Jennifer Lawrence but didn’t for Talia Jane.
You owe it to yourself, and to fairer society, to negotiate well.
Disclaimer: The facts, views and opinions expressed within this article are personal opinions of the author and do not reflect the views of BigDecisions. We do not assume any responsibility or liability for the same.