You set up a meeting with your manager. You sit down, feeling confident. You ask for a raise. And then, you receive pushback. Bringing up salary discussions with your employer is nerve-racking enough — when you run into an obstacle, you might just feel like giving up altogether. But if you can summon up the courage to push back, there’s a good chance you’ll succeed: 84 percent of people confident enough to negotiate are successful.
Of course, you have to be careful in your approach — there’s a right way and a wrong way to counter a rebuff. To help you prepare, we’ve compiled some of the most common salary negotiation hurdles job seekers and employees run into, as well as expert advice on how to handle them.
Situation #1: “Why do you deserve a raise?”
Occasionally, you see characters in movies or TV shows going to their bosses, hat in hand, to explain that they need a raise since because they have a new baby on the way, or just put a down payment on a house. But approaching salary negotiations from a self-serving perspective is rarely effective. Instead, share what you’ve done for the company that justifies getting a raise.
“Come up with a list of your accomplishments, such as revenue you've generated for the company, successes around cutting costs, improving efficiencies or customer satisfaction you’ve achieved,” recommends Steve Saah, Executive Director of Robert Half Finance & Accounting. “Communicate specific examples during the salary negotiation process to strengthen your case for why you deserve a raise.”
When employees demonstrate that their efforts have had a material (positive!) impact on the organizations, companies often reward them financially to a) incentivize them to do more great work and b) stay at the company for longer — hiring and training new employees is expensive!
Situation #2: “You’re already receiving a competitive salary.”
Rebuttals like this are exactly why you need to do your research before arriving at the negotiation table. If you don’t have a concrete idea of how much you deserve to be paid, you won’t be able to effectively respond.
“You are much more likely to get a raise if your boss believes by walking out the door that you can earn at least 15 percent more than your current salary. While threatening to quit is not a good negotiation technique, educating your boss about what the market is paying for your skills (assuming it's much higher than what you’re making) sends the same message in a less offensive way," says Marc Prosser, Co-Founder of FitSmallBusiness.com.
One free tool worth leveraging is Glassdoor’s Know Your Worth™ salary estimator — just enter a few data points like your job title, company and location, and you’ll get a free, personalized estimate of your market worth.
“A response to this [statement] could be, ‘Based on my research, the market rate for a position similar to mine is in the range of ____.’ Use that as a starting point for the discussion,” Saah suggests.
Situation #3: “We don’t have the budget for a raise right now.”
If you’re skeptical about the veracity of this statement, it might still be worth lightly pushing back. You can do this by meeting the employer on their level, and talking about things in terms of dollars and cents.
“Begin by understanding what the dollar value of salary increase that you want is. Say it is $1,000. Then determine ways that you can identify” — or have already identified — “$1,000 in potential budget savings or revenue increases and propose some solutions to your manager. This will show that you respect the budget process and are sensitive to managing the bottom line,” says Patrick Lynch, President of staffing firm CMP.
But if you come to realize that it’s truly out of their hands, ask when you can revisit the conversation — and hold them to it.
“You might say, ‘I appreciate your point of view or the financial state of the company right now. What do I need to do to earn consideration for a raise or promotion in the future?’ Then, work on any areas identified and show your progress,” says Linda Swindling, author of Ask Outrageously! The Secret to Getting What You Really Want.
Finally, see if you can negotiate for perks or benefits that don’t cost any money.
“Discuss other non-monetary perks, such as additional time off, telecommuting one day per week or more flexible hours if the company can’t bump up your pay,” Saah proposes.
Situation #4: “Our final offer is X.”
At this point, what you should do next really depends on your personal circumstances. If you’ve tried all of the above tactics to no avail and aren’t willing to leave your current position, you may just want to revisit the conversation at a more opportune moment. But if you’re prepared to walk, you might as well put the ball in your employer's court one last time.
“State in as polite a way as possible that there is a market rate for your talents, and that it is your hope that your current employer will make it a priority to pay you in accordance with your market rate and the contribution you are making to the organization,” advises Brett Hoogeveen, co-owner of leadership & culture consulting firm MindSet, LLC. “What you are saying here is that you want to stay with your employer, but that you are making it clear that the employer needs to take accountability for keeping up with market rates if they want to retain your talent.”
If your employer comes around, great! If they don’t, it’s time to keep an eye open for new opportunities. If a company isn’t willing to pay you what you deserve, another company likely will.