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Negotiating Job Offers

Common questions arise when considering a job offer, especially how to negotiate the terms given by the company. Do you wonder when, how, what and for how much you can appropriately negotiate? Below are some tips to guide you through the negotiation process.

1. Timing- When do you negotiate?
1. Do not negotiate before you receive an offer. It may provoke the employer to question if you will be an overly demanding employee. It gives them a reason not to give you an offer.
2. Once they have made an offer, you are in a position of strength. Get the offer in writing and ask for information about the benefits and compensation package that you are going to receive. Review them carefully.
3. Only negotiate with an employer that interests you. It is a waste of the employer’s time and yours if you do not intend to work with them
4. Be respectful and do not wait until the last minute to negotiate.

1. How to negotiate?
1. Courteously. Consider that you are building a long-term relationship with the employer.
2. To negotiate well, you must have as much information as readily available. What is the standard salary & package for someone of your academic/professional standing within the market/industry?
3. Negotiate with creativity and flexibility. Instead of a boost in salary, ask for one time expenditures.

1. What can you negotiate for?
1. When you negotiate, do not bring a laundry list of 10 items.
2. Focus on the items that are most important to you.
3. Below are some common negotiable items:

Timing:

Reply date -Negotiate the date to reply/accept the offer shortly after receiving the offer. If you are still interviewing, be honest and give a date that both works for you and is sensitive to the needs of the employer.

Start date -If you are in a class such as with investments banks, this is unlikely to be flexible. Some options may exist for scholars, December graduates or those with specific circumstances to join another class. If you are hired at a smaller firm or in a more unique position, the start date will be more flexible.

Compensation:

Salary- Tends to be less negotiable than a start date, but there may be some flexibility. When negotiating for an offer, he or she who names a number first loses. Wait for the employer to give you a number. If the offer is not what you want, be silent- it is your best ally. Wait for them to read the consternation on your face.

If they ask you to name a number, give them a range. This is where being prepared is extremely helpful. Also, you can ask the employer the typical range they offer employees of your educational and professional standing.

Sign-on Bonus- As a one time expense, an employer is likely to be more flexible here. If you are part of a large, annual class, there is likely little room for an increase. A smaller company is less likely to offer this, but do not be afraid to ask about it.

Annual Bonus- The amount may depend on you, your group and/or the company’s performance. It may be possible to negotiate a minimum bonus.

Relocation Assistance- If you have a sign-on bonus this may not be included in your compensation package as they expect that you will use your bonus for moving expenses. If it is provided, they usually offer 100% reimbursement for any relocation expenses such as accessing a broker, moving company, temporary housing or other related costs. Again, as it is a one time expense, companies are likely to be more amenable to the idea.

Stock Options- Many times smaller companies will offer stock options as they may not be able to offer you a larger salary. Get as many details as you can from the employer.

Early Salary Review- If you feel that you are worth more than the offer you receive and they are unwilling to change the offer, ask for an early salary review. Instead of being reviewed in a year, as is typical, ask to be reviewed in 6 months for a possible increase.

Car or Car Allowance- Generally, this is non-negotiable. Most often seen in sales positions to visit client sites, car or car allowance in investment banking may be car service on late nights.

Benefits:

Healthcare/Dental: Typically, this is non-negotiable as most companies offer set packages for their employees. You simply choose between option A and B for prescription, health, dental, vacation, and retirement plans, etc.

What may be negotiable is unpaid vacation time. Be upfront with the employer if you have predetermined travel plans. Oftentimes they allow you to take unpaid time or to even let you take vacation time early.

Tuition Reimbursement- Ask if they will fund the cost of a graduate program. Does the degree need to be related to your current work or can you pursue another subject? How do they reimburse and for how much? This is an excellent item to negotiate for; however, you want to make sure that the local graduate program is worth your time as well.

Special Training- Ask your employer if they will cover any special training or give you time off for you to complete it. If it is relevant to your work like a CFA, CPA exam, actuarial exams, computer trainings, etc. they are often amenable to cover various fees.

Work-related Issues- Often employers will allow you to negotiate some of your job duties. Is there a special group or specific assignment you would like? If your goal is to work in their Hong Kong office, can you be transferred there in two years? You can also ask about flex time or flex space if, for example, there may be a possibility to work at the client site or at home.

Professional Associations- Will they cover the fees of professional association memberships?

Other:

Visa Assistance - If you need a visa, ask what type of assistance you may receive from them. Will they cover the costs of legal fees and documents?

Hardware - Will they cover the cost of a laptop, blackberry or other devices important to your job?

Graduate School Timeline: If appropriate, will they give you time to apply to graduate school programs? Will they cover the fees?

Non-compete Clause - For scientists and engineers, this is a common practice. Ask how long the term of the clause will be. Is it one or two years or 3 months? Is there a geographic limit to the agreement? If you are presented with a non-compete clause as part of a contract you should have a lawyer review the terms.

Final Thoughts

Once you negotiate to arrive at your terms and they make an offer to accommodate them, be prepared to accept their offer. Remember that you also want this negotiation to be a win/win situation. If they grudgingly give you want you want, you are at an immediate disadvantage in your job.

When you accept an offer, also remember the intangibles in a job that you cannot negotiate such as the prestige of the company, their values, the work atmosphere, etc. Finally, remember that your first job will not be your job for life, however, the relationship that you build with your employers, beginning with the negotiation process, may last a lifetime.