By Claudine Kapel
Many job candidates are prepared to negotiate for a higher starting salary, especially now that the economy is getting stronger.
Are your hiring managers well equipped to handle those discussions?
According to a new survey by Robert Half International, 61 per cent of respondents indicated they would be comfortable negotiating for a higher salary or better benefits. In its tips for job seekers, the staffing firm suggests that if the desired salary is not possible, job applicants “should consider asking for extra benefits or perks, such as additional vacation time, a sign-on bonus or flexible scheduling.”
Hiring managers need to be sharp when navigating such discussions. They need to be able to shape a compelling job offer while staying true to company policies regarding the administration of total rewards programs.
Here are five things that hiring managers need to know to help them achieve a win-win outcome:
1) What’s negotiable and what’s not. The hiring manager will likely have some discretion with respect to the starting salary, but considerations such as the bonus opportunity and whether the job is eligible for a car or car allowance are typically established at a corporate level and don’t generally afford room for negotiation.
2) The going rate in the market. The compensation team should be able to provide insights on market compensation trends for the job in question. For example, if the skill sets being sought are in high demand and short supply in the market, the organization may have to be more aggressive regarding how much it is prepared to pay.
3) How negotiations regarding vacation entitlements should be handled. For example, mid-career or senior-level job applicants are going to want to match or exceed their current vacation entitlements and will likely balk at accepting less. Ideally, the company will have guidelines on what to offer in such cases.
4) When to offer signing bonuses and how much to offer. Signing bonuses were originally designed to support the recruitment of job candidates who would be leaving money behind in the way of an unpaid bonus if they changed jobs. Today, they tend to be applied more broadly to make a job offer more attractive. Because signing bonuses represent a one-time payout, they are a more cost-effective means for enticing a job candidate than a high starting salary. This approach will also help keep the salary of a new hire more in line with the prevailing salaries of existing employees, which can help the organization maintain internal equity as well.
5) What distinguishes the organization as a desirable place to work. Although job candidates are very interested in how much money they could earn, pay isn’t the only thing they care about. Hiring managers should be well versed in all the features that make your organization an employer of choice, including the types of benefits offered, the organization’s culture, the opportunities for learning and growth, the organization’s approach to social responsibility and any other considerations that might appeal to job candidates.
A well-orchestrated approach to defining job offers will set the stage for smoother negotiations, while minimizing the potential for future headaches.
Claudine Kapel is principal of Kapel and Associates Inc., a Toronto-based human resources and communications consulting firm specializing in the design and implementation of compensation and total rewards programs. For more information, visit www.kapelandassociates.com.