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Five Lessons from Compensation Negotiations

Written By: Jillian Climie.

I’ve spent my career inside compensation teams helping companies determine what to pay new candidates and employees. Now, at The Thoughtful Co, I help women negotiate their compensation with their employers. Below I’ve outlined five key lessons that I’ve learned from being on both sides of the negotiating table.

1. Know exactly what you want before you go into a negotiation. This might seem like an obvious one, but I’ve seen many situations where it’s clear the candidate or employee doesn’t know exactly what they want. And at that point, the employer knows they can move you where they want you to go. Give yourself the space and time to determine what you're looking for in each component of compensation or benefits (e.g., $20K salary increase, working from home every Friday, $15K sign-on stock option grant, and an executive coach for the first three months in role). Be extremely specific with yourself on quantities, timelines and amounts. Avoid offering a range. Knowing your exact numbers and being able to concisely articulate them is powerful, and takes so much of the unnecessary back and forth out of negotiations. You’ve communicated your exact ask, it’s now over to the other person to respond. It puts the pressure on the employer instead of on you.

2. How you frame the ask matters. How you ask for more money can sometimes be as important as what you ask for. This isn’t always the case – for example with recruiters who negotiate with hundreds of candidates it’s more about the “what”. But if you’re negotiating with your current or future manager, how you articulate the ask can have an impact, especially for women. Women are expected to be “likable” so when we negotiate, we can be judged more harshly. Starting your negotiation positively (for example, “I love working on this team and because of that I wanted to be open about where I’m at from a compensation perspective”), concisely articulating the unique value you add to the employer, and following it up with a clear ask (see point 1) is a winning combination. Practice how you’ll frame things and ensure you’re communicating the ask in a way that seems most beneficial to the other party – because there are often great benefits to the employer too, including retention of high-performing talent.

3. Don’t be afraid to discuss and craft your role scope. With many of our senior clients, negotiating their compensation goes hand in hand with crafting their role scope. Defining scope and team structure for either a promotion or new job can be a critical first stage in demonstrating leadership and understanding of what’s needed for the role to be successful. Additionally it allows you to outline what you will and will not have responsibility for. Once role scope is discussed and aligned on by you and your leader, outlining how that translates into your compensation package is a natural next step. Bringing your leader along in understanding all the responsibilities you own helps demonstrate the importance and impact of the role, and makes the increase in compensation a lot easier to push through.

4. Sign-on awards can be easy gives. Sometimes you ask for an increase in salary, bonus or equity and the answer is a firm no. In this instance, consider negotiating for a sign-on award to make up the difference. Maybe you asked for an additional $25K in salary and the maximum they will offer you is an additional $15K. See if the remaining $10K can be paid in a sign-on cash bonus. While it’s not the same as getting an annual amount that would increase over time, it does provide a middle ground option to keep both parties happy. Additionally, think about what you’re leaving behind at your previous employer and ask to get that covered in sign-on awards. For example, if you have an equity vest coming in the next six months, see if you can get the value covered in a sign-on cash or equity grant. Sign-on awards can be much easier to negotiate because they’re one time cash outlays for a company, not an ongoing expense, meaning they often have less budget restrictions.

5. Negotiating well demonstrates your leadership. I have experienced this in three ways: 1) leading a compensation team where the candidate skillfully asked for more money and being impressed, 2) being a manager and having one of my analysts ask for more money and being impressed, and 3) supporting women who have asked for more money and hearing their future or current managers are impressed. Negotiating is not always a negative conversation, it often is a way to demonstrate your leadership to your manager. It also can create stronger relationships between you and your manager by enabling more open conversations around performance and compensation. If you're avoiding negotiating, think of all the potential positive outcomes of the conversation instead of just the negative ones.


Book an introductory call with us at The Thoughtful Co if you’re going through a new job offer, performance review or internal negotiation process – or just want to talk about your compensation with your leader. We help our clients on average achieve a +25% increase in their compensation packages. We would love to see how we can help!


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