Posted by Robert Half Finance & Accounting on Monday, May 12, 2014 - 00:00 | Follow me
During the recession and recovery, employers held most of the leverage in discussions related to salary and compensation. Today, however, in-demand candidates have options, and there a talent shortage for the best and brightest. If you're a hiring manager, you need to learn how to negotiate salary, or your favorite job candidate may go elsewhere.
In this installment of Monday Management Minute, we’ll explore four helpful tips for managers who expect to negotiate salary with job candidates.
1. Size up the risk
Before you make a salary offer, you need to assess the candidate. If a particular job has been difficult to fill, especially if this is common knowledge, the job candidate has more leverage. Know how far you’re willing to go before you begin negotiating salary and always be prepared for counters.
2. Count your poker chips
Consider your company’s salary structure. You don’t want to give someone a salary that’s completely outside the company’s existing pay ranges. Like it or not, people talk, and there is a strong likelihood your secret will not be safe. Well-functioning organizations depend on teamwork, which, in turn, requires strong employee motivation. If a new hire receives a higher salary than the existing team, this is bound to hurt office morale.
3. Look beyond salaries
If you aren’t able to meet the candidate’s demands while negotiating salary, consider putting some other elements of compensation on the table, such as employee perks. For instance, telecommuting is a popular benefit, even if just for one or two days a week. That will save your new hire commuting costs and time, and thus make your offer more attractive. Likewise, flextime can act as a bonus when negotiating salary.
Signing bonuses are another monetary tool hiring managers can use to sweeten a compensation package without throwing the company’s salary structure into turmoil. This might also be an incentive to offer if the job requires the candidate to move and your HR policy doesn’t allow relocation reimbursement. Low-cost perks like loaner tablets and free healthy snacks that can go a long way in making new hires feel welcome, too.
Find out what you can do to finish strong in the negotiation process with our post: Salary Negotiation Tips for Today's Hiring Market.
4. Consult expert advice
It’s important to research the going rates to be able to offer more attractive salaries to prospective candidates. One valuable resource Robert Half makes available to employers and job candidates is Robert Half's annual Salary Guide for accounting and finance. The guide covers the national average starting salary ranges for more than 350 entry-, mid- and senior-level positions as well as more than 100 local variances to help adjust the salary information for your city.
Check out our Salary Calculator to access customized data for your location.
The bottom line: If it’s been some time since you’ve had to negotiate salary with a job candidate, be prepared to do so. It can be a delicate balancing act, and you’ll need to approach the process as dispassionately as possible. While you don’t want to give away the proverbial store, you also don't want to alienate good candidates or upset team morale.
Editor's note: This post was updated in 2016 to reflect more current information.