How to Negotiate For a Raise
So your bank account’s empty, your stomach’s growling, and your socks have more holes than the justification for ministerial pay packages. It’s called inflation friend, and you’re in need of a raise. Problem is, your HR department has requirements for that sort of thing. And unless you believe in God, no one qualifies. Fear not! With MoneySmart’s help, you may still stand a chance. Follow our method for a decent shot at getting your increment:
Let’s start with an admission: getting a pay raise is hard. In a big business, your boss has others to answer to, and the eventual decision may not rest with her. In a small business, there’s the ever-present threat of a tight budget. To improve your odds, be sure of the following:
Your company’s situation is appropriate
You’ve researched your case
You’ve prepared your notes
Your employer sees it coming
You’ve planned the follow-up
Follow our steps in sequence.
1. Your Company’s Situation is Appropriate
If your CEO just announced the budget is being slashed (and by the way, does anyone think a tie will hold his weight?) it’s a bad time to ask.
You should time your raise request with the company’s growth. Look for signs such as:
A growing headcount
Stepped up department budgets
Relocation to a bigger office
More obfun (obligatory fun) activities like family days and company excursions
These are all signs that the money for your raise exists. As a general rule, do not request a raise during or near corporate / departmental re-structuring. Wait at least a month after re-org; with everyone floundering, your superiors may be misinformed about their budget (or your job scope).
2. You’ve Researched Your Case
Check where you stand on the Mercer Pay Scale. If you are above the 70th percentile, your odds of getting a raise are very low. Rip up the salary report and swallow it.
Otherwise, tuck it in a file so you can use it as evidence.
Spend some time looking on local job sites, and note the salaries they are offering. If the amount is consistently higher than what you’re paid, you have a good case. Don’t print these out and flash them at your employer: you don’t want create the impression that you’re threatening to leave. Just get a good sense of how much you should be paid, so you can ask for a realistic amount.
3. You’ve Prepared Your Notes
Prepare a brief, and include the following:
A list of your accomplishments over the past 2 – 3 years
A concise statement on why you deserve a raise. And I mean a statement, not a Paul Auster-esque novella.
A list of your personal initiatives
Your positive performance reviews
Steps you’ve taken to help other employees
The trick is to think like a shareholder. In your concise statement, identify how you bring revenue and profits to the company. Explain how your salary and raise will generate so much revenue, they’ll more than pay for themselves.
This is also a chance to take stock of your current performance. Have you actually got enough material for the above? If not, it’s a good time to start building your inventory of good qualities. Go and lay the groundwork for your raise, then try again in another six months or so.
But if you are ready, then go ahead and…
4. Make Sure Your Employer Sees it Coming
I used to make the mistake of ambushing my boss all the time. But after a painful experience involving a Nerf bat and my eyeball, I realized that duct tape, a hood, and a big trunk are bad ideas.
It’s better to set an appointment with your boss. Make it clear you’d like to talk about a raise, and set a meeting later in the week. You may get a statement like “I really don’t know, the budget -mumble-mumble- pain in my rear.”
Don’t let it put you off. Smile, agree, and say “Perhaps we can talk about that when you have time on (insert day).”
Putting your boss “on the spot” is a useless strategy. First, she may not have the power to instantly approve your raise. This is the case in most big companies. Second, your boss needs to crunch numbers for the budget; without time to do that, the answer is most assuredly “no”.
5. You’ve Planned the Follow-Up
Prepare yourself for rebuttals, the most typical of which is “we have no budget for raises.”
Ask what you can do to justify a raise, and when your boss will get back to you. If she’s happy with your work, and there’s no budget for now, that’s fine. But when should you get back to her? Alternatively, ask if there’s any other steps you can take. Perhaps have your raise channelled into employee benefits, or stock options?
Brace yourself for a “no”, and take what you can get if it happens.
And if your boss does agree to the raise, ask for gentle confirmation. Thank her and say “I’ll look forward to it on the (agreed upon date).” Then rush to the break room and make “ka-ching” motions while doing a German jig.
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Have you ever negotiated a raise? Comment and let us know your tactics!
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