How to negotiate a pay rise
Negotiating a pay rise is a crucial career skill that is vital to master. Once learned, it will help you throughout your career.
YourMoney.com asked some employment experts how to ensure you successfully secure the salary you deserve.
Timing your negotiation correctly is pivotal. You need to catch your manager when they are at their most relaxed. Avoid arranging a meeting in the run up to a busy period, or on hectic days of the week.
“The best time to indicate you are looking for a pay rise is at the end of an annual appraisal which has gone well, and when your manager is likely to be well-disposed to you,” says Andrew Knorpel, head of employment at law firm Mundays.
Rebecca McNamara, client resource manager at Personal Career Management, recommends finding out if there’s a formal pay review process. If there isn’t, you should take control of the situation yourself, email your manager and ask to set up a meeting. Be upfront about the purpose of the meeting.
Shivali Chaudhry, solicitor at Hamlins, urges employees – particularly women – not to be afraid of negative reactions or appearing overly aggressive or assertive by broaching the issue of.
“Managers aren’t mind readers, and often a proactive approach is not only expected, but may be seen as a sign of ambition,” she says.
“The fact men are more willing than women to ask for more money contributes to the 20% disparity in average pay between men and women.”
If you are not receiving the same remuneration as someone of the opposite sex in the same job as you, you have the right to ask why this is the case.
Understanding your value
It is sensible to research what those in similar roles earn, both at other businesses and within your own organisation. Although, Knorpel notes this is much easier said than done.
“People are naturally cautious to discuss their own pay, so your information is likely to come from advertisements by your own employer or other employers for similar roles,” he says.
“Alternatively, it may be your employer has carried out a job evaluation exercise where your role has been graded and a formal pay scale is in place.”
Consequently, it may be best to research via job sites, and calculate an average based on the range of salaries on offer. There are also online calculators for checking average wages for specific roles across sectors.
If your employer has an HR department, you may also wish to discuss how pay increases are calculated with them. Management may have specific priorities in this regard; it could be lowest paid employees are first in the queue, or alternatively those who have been there longest.
Building a case
When negotiating a pay rise, knowledge is power. Arming yourself with a clear, convincing and comprehensive case in advance is essential.
“An understanding of how your role contributes to the wider business, along with an understanding of your worth in the wider market place, is key to persuading your employer you deserve a pay rise,” says Chaudhry.
Knowing what other employers are offering someone with your skills, experience and track record will be useful in building a case, but it is not enough in isolation. Chaudhry recommends keeping an ongoing record of your achievements and successes.
“This serves both as a great motivational tool, and tangible evidence you are worth a higher salary,” she says.
McNamara recommends preparing a list of achievements and successes in the role so far, and looking at the next 12 months to estimate when and where you may be able to add extra revenue.
“Think of possible objections your manager may have, and prepare your counter responses,” she says.
When you ask for a raise, you essentially ask your employer to increase their investment in you. Consequently, you have to be able to demonstrate how you can provide a return on the investment.
“You will need to prove to your employer you have earned a pay rise, and intend to maintain a high level of performance in the future,” says Knorpel.
“A one-off result will not be sufficient if your performance is not consistent.”
Presenting a case
Ensure negotiations take place in a formal setting, where you have your manager’s full attention and the meeting won’t be interrupted.
“The image you portray must be one of dedication to the company, not just in the negotiation meeting, but throughout your time at the company. Present yourself as a sound investment and keep the meeting as professional as possible,” says McNamara.
“Keep it positive, and try to think about the language you intend to use beforehand.”
Knorpel stresses the importance of being polite and calm. If you don’t get the result you want immediately, threatening to leave is the worst thing you could possibly do. Besides, it may be your line manager does not have final say when it comes to pay rises.
“If so, give them sufficient information so they can convey your case to the people who matter,” he says.
McNamara likewise warns against backing yourself into a corner via ultimatums. Instead, she suggests reaffirming you love your job, and it isn’t purely about wanting more money – more that market rates for your role are higher than you currentlu receive, or given your experience and skills, you feel you should receive more.
“Don’t be apologetic. Be honest, professional and confident,” she states.
McNamara notes one of the best negotiation tactics is silence. Be concise and professional, state your case, then sit back and let your manager talk.
“Don’t give them a number first either. Ask open questions like ‘what is your budget for this?’ and listen carefully to the answers they give you. Sometimes there really is not any more money available,” she says.
In the event their answer is no, stay calm and ask what you need to do better. Suggest meeting again in three to six months’ time, be gracious and thank your manager for their time. This will stand you in good stead for future discussions. Alternatively, see whether your manager is able and willing to offer you alternative remuneration.
“There are other items such as benefits, bonuses and long-term incentive schemes to consider. If you’re talking about the long-term with your employer, it shows you intend to stick around and be loyal if they can offer you the right package,” says Knorpel.
It is also worth bearing in mind some benefits, particularly pension contributions and childcare vouchers, are more tax-advantageous than straight salary.
Overall, view negotiations as an opportunity to get feedback on your performance, and find out any issues they may have. Stay relaxed, and don’t be defensive, after all you want to keep your manager on your side. If a pay rise is agreed, ensure it is put in writing.