Considering a Counter Offer? How To Negotiate Your Salary
I was recently speaking with a young man that received an offer for a new employment opportunity. This new position would provide him with a significant increase in salary, as well as benefits and perks he had not received from his previous employers. However, before accepting the offer, the young man took the gamble of making a counter offer to the salary presented to him by the potential new employer.
Knowing Your Worth
The gentleman indicated to me why he felt confident in his approach. His education was higher than most of the colleagues he worked with in his field. He had a level of experience well above what was required and had increased his responsibilities quickly within a relatively short period of time at his current employer. He was able to confidently articulate his past successes of cutting costs and creating a number of efficient processes. And at the end of the day, he was comfortable with walking away from the new offer as he was not unhappy with his current employer and still had a margin of growth available to him. The motivation and level of thought in case, ultimately worked in his favor resulting in an accepted counter offer. Understanding the value you bring to an organization and where you stand amongst other candidates is a great advantage.
Understanding Counter Offers
When it comes to counter offers, the strategy of the candidate is typically to attain the highest possible salary, while the employer looks to utilize the counter offer as a tool for retaining an employee at a salary that is within the market range while not overpaying for the position. Generally, if the counter offer made by the prospective employee seems reasonable, most employers will either accept or counter once more with their own offer. A counter offer can also consist of a request for additional benefits and perks such as more time off, bonus eligibility as well as company paid relocation.The process normally begins with a verbal agreement and is followed up with a confirmed offer of the details in writing. It is a good practice that the employer sets a deadline on receiving an accepted offer.
Having flexibility to entertain a counter offer depends on a number of factors including the position and the organization’s ability to increase the salary. The flexibility of an employer to entertain a counter offer could depend on factors such as:
- the level of the job within the organization;
- how common the skill set, experience, and knowledge are for that particular role as well as the need in the employment market;
- the level of career advancement or the career stage of the person offered the position;
- the market value of the vacant position;
- the salary range already established;
- economic conditions in the job market as well as the industry
What Not To Do When Making A Counter Offer
While much of the success behind the counter offer lies within the company, the prospective employee can ultimately make or break the deal. Recommendations of what not to do in a counter offer include:
- · Do not lie about your previous salary. I have had potential employers request to see a recent pay stub.
- · Do not get defensive or upset. Be prepared that the negotiation may not go in your favor.
- · Do not talk about personal finances. An employer should not feel obligated to pay based on your debt and financial goals.
Candidates should be cognizant that if the employer is unable to reach an agreement there is the likelihood the offer could be denied and presented to other qualified candidates. The key to a successful salary negotiation is having an employment contract that is acceptable to both the employer and the new employee.