Asking for a Raise: Get What You're Worth
How do you get your employer to pay you what you are worth? First, schedule a compensation review -- not just your last six months' performance, but a review of your worth to the company and the marketplace. Schedule a day, time and place with your boss, and make sure it is on his or her calendar. Next, be prepared to do some research. Follow the steps below and you might be able to negotiate a more accurate compensation package to reflect your value to the company.
Step 1: Know Your Employer's Compensation Guidelines and the Market
Generally, you are not going to lose your job or hurt your career by negotiating for additional compensation. The worst-case scenario is not receiving anything above your current compensation level. However, you need to know where your employer stands so you can play your cards right. It is also important to know others' salaries in the local employment market for your field and job. If you don't have a good idea, many resources exist, such as kforce.com's Salary Survey and Market Navigation Guide.
Compensation Guidelines Your Company May Follow:
- Fixed offer - You can negotiate all you want to no avail. This type of management does not negotiate salary at all, so you may not want to waste much of your time negotiating. It is still wise to ask for a review.
- Pay-grade system - You will be paid within a set salary range based on your experience and the associated job duties. This is the most common compensation system. The best way to attempt a salary increase within this system is to get the job reclassified into a higher pay-grade. If the required skills have been underestimated, this can happen. Emphasize your skills as they relate to the position's duties.
- Negotiation system - If your employer uses this, you are lucky: he or she can raise or lower your salary without going through bureaucratic red tape. If you encounter this type of employer, go for it! You may not get everything you want, but it doesn't hurt to try.
Step 2: Follow Your Employer's Lead
It's a little scary walking into a superior's office with the intention of asking for more money than he or she is currently paying you. The following approaches help to begin the negotiation process:
Approach 1: I love my current position, but I would like to know if there's a possibility to re-negotiate the salary.
Approach 2: I really love this position, but I was a little disappointed to find out that I am not making what my peers in this industry are (if you use this approach, make sure to have numbers to back you up).
After either of these approaches, it is best to let the employer respond and then continue the discussion based on their lead.
No matter what their attitude, be enthusiastic and professional during negotiations -- this is not a competition. Don't put yourself and the employer on opposite sides of the bargaining table. Instead, impress that you are on the same side, working for a solution to make you both winners. A take-it-or-leave-it attitude negates the feeling that you are a team player. Calmly and logically state what you feel you are worth financially, and give your boss a chance to agree or make a counteroffer.
Step 3: Break It Down into a "Small Request"
Remember, you are not asking for a lot of money. If you are making $40,000 and want a 5% increase (to $42,000), you are only asking for $.96 more per hour ($2,000 / 2,080 working hours in a year). You want your employer to see this as a small investment with a high return. You are a great employee and not worrying about money will eliminate a distraction that could keep you from focusing 100% on your job.
Step 4: Be Willing to Accept a Compromise
If you are making $42,000 and you want $46,000, try saying that you want $48,000. Overstating the amount of increase might get you closer to what you actually want. The employer may offer you $45,000, which is less than what you wanted, but still $3,000 more than your current salary.
Step 5: Don't Forget About Benefits
All right, it's not a perfect world and you may not be able to coax your employer into paying you more in salary. Don't be discouraged. You might be able to increase your compensation in benefits and/or perquisites. These often have more real value than cash, especially if they involve pre-tax dollars or provide security that is important to you. Ask what types of extra benefits your boss can offer, if any. (You can also use a general lack of benefits to help increase your base salary.) Other negotiable areas are: vacation time (often increased for more senior employees), healthcare premium coverage, educational reimbursement, hours, or salary review (you might negotiate another salary review after six months, rather than a year).
Step 6: Sell Yourself
Your employer offered you a job for a reason so reiterate that. Remind him or her of your unique skills. One suggestion is to make a chart relating the duties of the job to your skills and experience. Bringing more to the table than the bare-bones requirements in your job description can show your value to the company and justify why you are worth more. It is very important that these discussions be perceived as win-win. It may be in your best interest to keep a journal of your accomplishments, no matter how small they may seem. It might include e-mails from your boss, appreciative internal customers, external customers who see the value in what you do, etc. You want a record of your work to justify a salary increase -- remember, your boss may want to give you a raise but may need ammunition to go to his boss or Human Resources to get you more money.
Step 7: Don't Settle for Less Than You Need
Decide the minimum amount of compensation to make you truly satisfied (be realistic, given what others are being paid to do similar work in your city) -- and don't accept any less. Honestly assess your monthly cash requirements so you can be firm about your minimum. There is no point in taking an offer that will leave you unsatisfied and wanting to look for another job in the near future. If an employer refuses this amount or you reach an impasse, start looking.
Step 8: Get It in Writing
In a perfect world, everything discussed in your review will happen, but unfortunately, that is not always the case. To avoid potential problems, ask for a written review of the agreed-upon changes, i.e., salary and benefits, as well as a thorough review of performance against your job description. This way, if there is confusion at a later date, you will have written documentation stating the conditions under which you were hired. This is especially important if the conditions of your employment differ from normal company policies.
Step 9: Mock Compensation Review
The best way to get your confidence level up is a mock interview. Have a friend play devil's advocate (the employer), asking questions to prove your worth. Provide justification for an increase in salary. This will prepare you for dealing with opposition, making you more confident and relaxed when it's time for the real thing.
Now that you have a game plan, schedule that compensation review with your employer. Even though you are well prepared to negotiate, you may not get everything you want. But remember that any improvement is better than none. If you don't get what you want, you know that it's time to start looking for good fortune elsewhere.