Why Salary Negotiation Is So Important

When accepting a new job, salary negotiation is so important. You may have to consider many additional costs that may not be readily apparent to you, which the new job may demand and which are not there in your present job. The costs may or may not be quantifiable but it is important to be aware of them when thinking of salary negotiation. This article explains these issues in more detail. The salary that you want to earn in the new job should not be a fixed figure but rather be in a range. This is because during salary negotiation of the new job the total cost involved may not be clear in the beginning. The expected figure should be disclosed to the prospective employer after fully understanding all the implications of the new job and may require to be calculated. One of the undisclosed expenses may be health insurance. The insurance policy of the new employer may require you to pay a higher amount from your pocket for each pay period whether it is weekly or bi weekly or monthly. Even if it is a small amount per pay period, an annual calculation may make it substantial.

Paid overtime hours is an important issue you have to consider. If your present job pays for your overtime hours and the new job requires you to be on call 24 hours, then you may be actually getting less if you divide the extra hours put in from your annual salary. Even if it is a few hour a week, it will become considerable amount when calculated for an entire year. There are many other issues, which are sometimes called perks to consider like reimbursement of tuition expenses, flexible working hours, 401(k) contribution, on-site daycare and health clubs, company paid training, mobile phone and/or laptop computer provided by the company, paid professional membership to associations and institutes, vacation and personal holidays, car parking expenses, tax deductible expenses, and the possibility of working from home. Many of these factors are intangible benefits – one might not be able calculate them in dollar terms but depending on your situation they may be very important to you like for example the option of working from home for a mother having small kids to look after at home.

Salary Negotiation – Negotiating Salary In An Interview

Getting selected in a job interview is only half the job done; the other half is salary negotiation. When negotiating a salary, timing is important. Asking the salary amount right in the first instance would be imprudent. It is important to get the job offer or reach the final interview first before negotiating the salary. This article gives some tips on salary negotiation, helping you in negotiating your salary with a prospective employer.

There are many different situations that one would face regarding the salary that he or she is offered depending on the type of job and the type of organization. In some jobs there may not be any room for negotiations, you simply have to accept or reject what is offered. If you don’t like what is offered, you have to look for another job.

Looking from an employer’s perspective, if you have fixed X amount as the salary for a particular job and if somebody is willing to work for X-Y amount, you would have saved Y amount for the company. Hence you may initially offer X-Y amount to see if the prospective employee accepts it and give yourself room for negotiation if required. Remembering this strategy, when the employer asks your last pay drawn, you must disclose the true amount and also explain why you are worth more like you were responsible for increase in sales by Z% or you have saved Z amount for the company and so on.

If in an interview you are offered X amount as salary and asked for your opinion, there are some options for you:

1) You can remain silent in which case the employer may think that you feel it is too low and might raise the offer

2) Explain to them the last salary that you were drawing and that you expect a raise by Y amount and the reasons for the same. The Y amount should be a few thousand dollars more than what you are willing to settle; this would give you room to negotiate in case the employer wants to bring it down

3) Accept the offer on the condition you expect the salary to be revised after a few months on the basis of your performance. This offer is most likely to be accepted by the employer but you are taking a risk in that you should demonstrate tangible benefits to the employer within the agreed time.

Depending on the position you may also ask for a share of the profit or benefit that has accrued to the company because of your efforts. Like if you are in sales department, a share of the X% increase in sales that you have brought to the company or if it is production department, a share of the X amount of saving because of your efforts etc.

Whatever be the case, it is important to negotiate your salary at the time of interview or later in order to get what you are worth.