Salary Negotiation Mistakes That Can Ruin Your Hiring Plans

Salary negotiation mistakes

Negotiating salary with a job candidate? Here's what not to do.

For a number of years, hiring managers held all the power in a salary negotiation. But in today’s market, where a serious talent shortage in industries like accounting and finance is hampering companies’ abilities to expand quickly and profitably, many are finding the opposite is true. 

It’s not unusual for the most in-demand candidates to receive multiple job offers. These professionals hold the power when it comes to salary negotiation. That makes some hiring managers nervous. And nervous hiring managers can make mistakes. 

Here are five potential mistakes — and how to avoid them when you negotiate.

1. Making it all about the money

Yes, we’re talking about salary negotiation, so money will inevitably be a central element. But money isn’t the only thing on the table here. With some judicious questions, you can find out what else is important to a potential hire, whether that’s an enhanced job title, flexible scheduling options or the ability to telecommute. Sometimes, candidates will accept these perks in lieu of higher starting salaries if you’re reaching the upper limits of what your budget will allow.

2. Being blinded by talent and forgetting about fit

You may meet a candidate who seems so talented, you’re tempted to do anything you can to get him or her on board. That often means extending the salary negotiation and upping the offer. 

But being the best candidate doesn’t automatically make the person the right one for your company. Be sure to get a clear sense of how the candidate will fit in with your company culture — and then consider if it’s worth meeting his or her salary demands.

3. Discounting the water cooler

Most people prefer to keep their salaries private. But people talk. Keep in mind that whatever offer you and a job candidate agree on during a salary negotiation could quickly become public knowledge among your employees. 

If the compensation package is out of proportion with what the new hire’s peers make, it could lead to feelings of resentment among your team. Go into the negotiation with a clear understanding of your company’s existing salary structure and stay within that range. 

4. Not paying attention to how the candidate responds

Just as the interview can reveal clues about a job candidate’s personality, so can the salary negotiation. This process can show you what the person values most, how much he or she really wants to work for your company, the job seeker’s communication style, and, perhaps most importantly, how the person responds to not getting what he or she wants. 

So be even more attentive to red flags that pop up when you’re talking money — and be ready to pull an offer if too many appear.

5. Not being willing to give a little more for the right candidate

Sometimes, the biggest salary negotiation mistake of all is not negotiating enough and failing to meet a strong job candidate’s demands.


Sometimes, the biggest salary negotiation mistake of all is not negotiating enough and failing to meet a strong job candidate’s demands. Highly skilled professionals who are a good fit with your company culture are usually well worth the investment, even if you have to pay a little more than you would like to encourage them to join your team. 

Once you’re sure you’ve found just the right candidate, don’t be afraid to loosen the purse strings a little. The candidate will appreciate it — and in the long run, so will you.

Need a little help setting pay ranges during the salary negotiation process? Download free copies of our annual Salary Guides to see starting salary ranges for more than 750 positions across various industries.