Negotiating: Tips in negotiating a win-win compensation package

Aug. 8, 2005
When setting your financial goals and preparing for salary negotiations, Rich Lakis, a human resources consultant with more than 15 years of senior level HR experience in the banking, telecom and travel industry sectors, offers these tips in negotiating a win-win compensation package.

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Get to know and understand your worth or value in the labor market. There are a variety of tools and web pages, such as, that can provide salary ranges and total compensation by position types and several will provide that data by geography. Why not ask the interviewer what the salary range is? “You should understand that there will always be budgetary and internal equity issues for the hiring manager to consider, but if you can show your value relative to what the incumbent was earning or what others might be making, you will give him or her good reason to consider going to bat for you,” notes Lakis.

Don’t base your salary expectations solely on your current earnings. What if your current employer is paying under market? Or, what if you have been in the position for several years and are already earning what the market “suggests” you’re worth? Keep in mind that ranges provide for a broad spectrum of candidates, and your experience or relevant skill set may not be considered to be at the top of that range. Don’t make the mistake of assuming too little or too much. And, depending upon the position, there could be other forms of compensation involved, most notably annual bonuses or sign-on bonuses.

Establish what your priorities are and how compensation factors into the equation. If money is not your primary reason for wanting this new position or wanting out of your old one, don’t make it a sticking point if it provides for other upside opportunities. In fact, you should make clear to the interviewer that there is more to your decision to change jobs than just the compensation.

Demonstrate your worth to the interviewer by detailing your accomplishments and what they have meant to the bottom line of your current or past employers. “Applicants who spend too much time telling the interviewer what they do and not enough time discussing what they have done are doing themselves a great disservice,” says Lakis.

Remember, the interviewer will not know what you are worth unless you paint the picture.

Don’t get bogged down in conversations about your current earnings if they are not relevant to the position being discussed. You could be offered more than you are earning and it still might not be appropriate for the desired position. Lakis suggests, “Gear the conversation to the worth of the position or the skills and experiences you have rather than your current earnings.”

Ask the interviewer to describe the salary range rather than suggesting what you are hoping to earn. This way, you’ll be in a position to know how close or far off your expectations are. If you are earning more than the position pays, yet it appeals to you for other reasons, why not tell the hiring manager that you really want the job and ask if there is a way that the financial gap can be made up by way of an up-front or sign-on bonus or suggest a performance review after six months.

Leverage other factors to your advantage such as a forthcoming salary increase or that you’re assessing other potential employment situations. Do not make any ultimatums — it seldom creates a win-win situation. This tactic leaves a prospective employer with a bad feeling and leads to judgments as to the type of employee you will be and that you will be better off employed elsewhere! Bottom line, think big picture. If everything about the offer matches your criteria — job description, reporting manager, working environment, and company policies and mission — get the best compensation package you can while letting the hiring manager know you are the best candidate for the job.