Leaving Money on the Table, or Not, when Negotiating

The following is a guest post from by Pam Lassiter, author of The New Job Security, Revised: The 5 Best Strategies for Taking Control of Your Career. If you’ve been wondering how to best negotiate a salary with a new employer, here are some great tips.

It happened again today. I was speaking to a very senior level professional who was looking at a very senior level job in, you’ve got it, a senior level type place, i.e. an organization that was actually growing that could find some discretionary money for her if they were so motivated. I asked her if she’d negotiated her salary yet in the process of nailing down the job offer, and she visibly winced. “No, I’m not good at doing that. I negotiate contracts for my company with great success, I negotiate win-wins between labor and management, and I negotiate for my budget every year. For myself? No. I don’t do that.”

She just left money on the table. And she’s not alone. I’ve worked on all three sides of the comp (aka compensation) question: as an employer, as a consultant on compensation systems with a large firm, and primarily as an executive coach, leading professionals to desired conclusions in their own career and compensation discussions. I see money being left on the table constantly by employees in most salary negotiations because you hate to ask for it, and you’ll never know that the money is there if you don’t, especially when you’re first being hired by a company. Here’s the most amazing part: you can actually hurt your reputation by not asking for a higher salary.

Sound strange? Here’s what happens. Most medium to large companies have salary ranges or bands that allow managers some discretion to recognize knowledge, experience, technical expertise or competitive pressures when they’re hiring someone into their company. Are they going to offer you the top of their range just because you’re a good guy (that’s a gender-neutral term) and deserve it? Not if they want to look good to their own boss. They’re saving on their budget anywhere they can, and your salary is part of it. In addition, they need to offer you towards the bottom of the range set for your job when you come in so that they’re able to grow your salary over time. Your goal is to get towards the top of the range and then change pay grades with a promotion, right?

In addition, if you don’t ask your new employer for more than the original offer, they’re going to be disappointed in you