Negotiating a salary offer can be intimidating. In fact, fewer than half of American workers negotiate their salaries, based on research by CareerBuilder. Yet doing so can pay dividends, and according to a recent survey, 90% of organizations are open to negotiating salaries for some or all of their positions.
So, when does it make sense to negotiate your salary, and when might you want to accept the first offer you receive from a prospective employer? In this article, I break down four prerequisites for salary negotiation, as well as three times you will want to skip it.
When To Negotiate Your Salary
Here are four prerequisites that need to be met before asking for a higher salary:
1. You have an offer letter in hand.
To begin, you will want to wait until you have a written offer letter in hand before attempting to negotiate your starting salary. This is important because you don’t want salary negotiation to interfere with the interview process and your potential offer. Instead, you want to first confirm you have the position, then negotiate your total compensation and start date.
If you happen to be asked your salary expectations before you receive an official offer letter, give this article I wrote for Forbes a read on how to respond effectively.
2. You understand the salary range for the role.
You also need to understand the salary range before entering into the negotiation process. You don’t want to make the mistake of asking for additional remuneration if your offer is already at the top of the company’s pay scale. Conversely, if you are at the lower end of the range, you can use this as rationale for requesting additional compensation.
And know that requesting information on the budgeted salary range can be as simple as asking, “What is the salary range for this role?” or “What do you have budgeted for the position?” If you feel nervous about asking this question in person, you can send the question via email to the recruiter.
3. Market research indicates you are underpaid.
Beyond the company’s budgeted salary range, you also want to look at external market research. You can consolidate data from sites like Glassdoor, Salary.com, and PayScale to come up with the average pay range for someone with similar experience, education, knowledge, and skills. Blind and Reddit also provide community forums to compare your salary offer with industry peers.
Again, you want to go into the salary negotiation with as much information and data as possible. I share additional insights on how to negotiate your salary with confidence in this Forbes interview.
4. You have a compelling reason.
Finally, any request for a larger salary needs to be accompanied by a reason. Most often, this reason will be a combination of #2 (you are on the lower end of the salary range) and/or #3 (market research indicates other companies are paying more for someone with your skill set) above.
You can then summarize your rationale for a salary adjustment in a brief email to the recruiter.
When Not To Negotiate Your Salary
Now, when should you avoid negotiating the salary on an offer you received? The following are three situations where it makes sense to think twice before asking for a larger salary.
1. You already accepted the offer.
For starters, you don’t want to make the mistake of accepting the offer, then going back and requesting a higher salary. Although there are uncommon situations where you may accept the offer and then ask for a larger salary — like a significant change in the scope of the role — these are far and few between.
Simply put, any salary negotiation should take place before you formally accept the job offer.
2. The company has a no-negotiation policy.
Next, some companies maintain a no-negotiation policy, meaning they will provide you with a single and best offer, which you then can either accept or decline (this is often done in the spirit of pay equity). If you receive a salary offer from a company with this type of policy in place, they will likely inform you that this is the case, and you will want to skip the salary negotiation phase.
3. You don’t have a compelling reason.
Lastly, don’t feel compelled to negotiate your salary simply for the sake of doing so. While there are career coaches out there who claim you always need to negotiate your pay, and they likely have your best intentions in mind, their advice can be ill-advised, as doing so may result in starting off on the wrong foot at your new job.
Instead, you only want to negotiate if you have a truly compelling reason to do so and have collected enough market research to back up your request. You’ve got this!