09 Jul Why You’re Probably Not Getting Paid Enough
“You were such a pushover when you were negotiating your compensation. You could have got more money, but you never asked for it.”
I couldn’t believe what I was hearing.
A year prior I received a job offer to join a company that I was referred in by a senior member of the organization. I had several interviews with the company and they offered me a nice salary bump from my previous job. I was happy with the offer. Here is what I told the VP after getting my offer:
Well, I really enjoy this company and since I came here through a referral I really want to respect the offer. I’ll take it. When do I start?”.
No fuss or back and forth negotiations or counter offers. It was a very simple and quick transaction. I made sure it was as simple as possible so I didn’t ruffle any feathers before I joined the company. Seems like something a loyal and respectful employee should do right?
I stared at the VP and I didn’t know what to say to him. We got to know each other really well since I joined the organization and I really respected what he had to say.
I replied back to him with the only thing I can think of at the time: “Come on. You’re kidding. Right?”
He wasn’t kidding. He shared another story with me.
You know Alicia from Marketing? She was promoted as the interim Director of Marketing. She didn’t even get a pay raise. What do you think that says about her ability to be the Director of Marketing. She could have received a 20-30k pay raise if she just negotiated properly.
I wasn’t even mad. I was learning. I needed to hear these types of conversations.
Here is what you can learn from these conversations:
Failure to negotiate pay is a sign that the candidate doesn’t know their self worth.
Even if the first offer was more than you expected or wanted, you should always counter offer. This was by far the hardest for me to swallow. I thought I was doing a good thing by NOT negotiating. I wanted to show myself as a hard worker who valued work more than money.
What ended up happening is I showed myself as someone who didn’t know what I was worth and I took the first offer that came to me.
Failure to negotiate leaves a lot of money on the table
No explanation needed for this. I could have had more money simply by asking for money.
It is not the company’s responsibility to give you the maximum salary.
I know this is going to be a little controversial, so let me explain.
If you are selling a house, are you going to tell the buyer what the lowest you will sell the house for? Absolutely not. You are going to do everything in your power to sell the house for as MUCH as you can.
Also, the value of the house can be worth more depending on the buyer’s needs.
If your house is walking distance from an elementary school then your house is worth more to parents with young children than it is to an elderly couple. It is up to the buyer to get the house for the least money as possible, and the seller to sell it for as much as possible. It’s your classic Venn Diagram. Once you find the middle point a deal can be made.
So if you feel like you’ve been screwed over by salary negotiation, it’s not the company’s fault. It’s your fault. They hired you when you needed the money and you didn’t counter offer with anything substantial.
Can a company rescind an offer if you negotiate your pay?
The answer is a company can do whatever they want to. They can rescind the offer even if you didn’t negotiate your pay. I’ve seen it all.
Is it likely to happen? In my experience, I have not seen a company pull back an offer for a candidate that they WANT to join the company. The worst I have seen the company say is “No, this offer is not negotiable”.
If you’re desperate for money or a career and are afraid to negotiate then my suggestion to you is to just take the offer and join the company. Don’t risk anything even though I believe the risk is extremely low.
The easiest time to negotiate your salary is…
Before you join the company. This is when you have the most power. Once you’re part of the company negotiating your salary becomes a very hard task. A task that I haven’t been able to do successfully.
When I joined I actually told the VP that we should revisit my compensation 6 months after I joined. 6 months later we had the conversation. The result was, you guessed it, no change in compensation.
Shouldn’t I be mad at the VP who told me I was a negotiating sissy?
No way. He taught me a valuable business lesson: Don’t be afraid to get what you’re worth.
Not only will you make more money, but you will get a lot more respect. If he didn’t tell me anything, I would have made the same mistake again.
So, Thank You MR. VP.
I want to be a better negotiator, can you recommend required reading?
I’m so glad you asked. The best book hands down on negotiation is Negotiation Genius. There is seriously nothing else I can recommend besides this book. I have no affiliation to the author or this book. It’s just a great book on negotiation overall.
Yes, I modified the personal details slightly to protect the company / client. Also, the company / client name is not even on my profile so your best guess is probably wrong 🙂
PS: Read the only resignation letter template you’ll ever need.