Subscribe to our newsletter and be the first to access exclusive content and expert insights.

subscribe now subscribe cover image
Gouri Shah profile imageGouri Shah

Negotiating a salary is not always an easy task. The Established shares a handy guide on how to go about it without any awkwardness.

The Smart Girl’s Guide to Finance – How to negotiate the salary you deserve

Negotiating a salary is not always an easy task. We share a handy guide on how to go about it sans any awkwardness

There are two types of people in this world. The type who can negotiate a better salary and others who cannot. Most of us believe, or rather want to believe, that a good soldier—who works hard—will always be rewarded fairly for it. Even though experience tells you otherwise, the sheer anxiety that comes with having the worst-case scenario play out in your head—what if they think I’m greedy? What if they think I don’t deserve it? What if I get fired? It is enough to bottle any notion of negotiating a better deal. Choosing to simmer and struggle, even quit, rather than deal with an unpleasant confrontation with their manager.

According to a study titled ‘PayScale – Raise Anatomy’  by PayScale, an American compensation and salary data company, only 37 per cent of employees actually asked for a salary raise. Women were more likely than men to state that they hadn’t asked for a raise because they felt uncomfortable with negotiating salary. 

But here’s the deal: If you do muster up the courage, the study says that more than 70 per cent of those who ask for a salary raise, end up getting one. Moreover, data from the recent Salary Trends Survey by workforce consultancy ECA International, noted that Asian nations—led by India, Vietnam and China—made up eight of the top 10 countries forecast to see real salaries rise in 2023. 

Experts recommend that you bite the bullet and have that conversation with your manager. Here are a few tips on what you can do to ensure that you negotiate the salary you deserve. 

A handy guide to salary negotiation.

A handy guide to salary negotiation.

If you do muster up the courage, the study says that more than 70 per cent of those who ask for a salary raise, end up getting one. Image: Unsplash

If you do muster up the courage, the study says that more than 70 per cent of those who ask for a salary raise, end up getting one. Image: Unsplash

Do your homework 

Before you ask your manager for a raise, be clear about your expectations. Have a number in hand—this could be your expected take-home salary or percentage of raise. A good way to arrive at a figure that is both acceptable to you and realistic to your employer, is to do your homework. Research average salary ranges listed on job postings for your role. Ask friends within the organisation, former colleagues or people in the same industry for estimates of the salary range. You could also speak with recruiters or look at websites such as Payscale, Glassdoor and LinkedIn’s salary insights for more information on compensation data.

“RESPECTFULLY DECLINE THE OFFER IF IT DOESN’T WORK FOR YOU. RECRUITERS HAVE CERTAIN BENCHMARKS THAT THEY HAVE TO WORK WITH, SO THERE IS NO RIGHT OR WRONG IN THIS SITUATION”

-DISHA MAKHARIA

“Figure out what the industry standards are, and be realistic about your ask. While a 100 per cent hike in compensation is not uncommon in the IT  industry, it would be unheard of in industries such as retail and publishing. On average, one could easily ask for a 30-40 per cent hike in compensation if you are moving to a new job,” says Disha Makharia, HR consultant and recruiter, who has recruited for companies such as Walt Disney, Moët & Chandon and Conde Nast India. 

Next, make a list of your achievements at work over the last 6-12 months. Include statistics or tangible outcomes wherever possible, which clearly point to your contribution towards the organisation’s growth. If you have received accolades from your manager, colleagues or clients, it might be a good idea to bring that up during the meeting.

Pick the right time 

“The best time to bring up your raise is during the annual appraisal with your manager,” says Vinayak Talwar, senior manager – Leadership Hiring & Campus Initiatives at RPG Group. This is a better strategy than negotiating your salary as a reaction to what has been handed to you. During the appraisal, you will have the opportunity to showcase numbers and instances which demonstrate the value you bring to the table. 

Be mindful of the undercurrents at work. If your company is going through budget cuts or layoffs, or if concerns have been raised about your performance, this might not be a good time to ask. On the other hand, if your work has been noticed and appreciated, strike while the iron is hot. 

publive-image

"It’s important to do it (negotiate) in a polite yet firm way, rather than being flippant or disrespectful." Image: Getty

Hold your ground, respectfully

“Respectfully decline the offer if it doesn’t work for you. Recruiters have certain benchmarks that they have to work with, so there is no right or wrong in this situation,” says Makharia. Moreover, if you decline respectfully, chances are that the recruiter will remember you when they do have the budget to bring you on board. “I appreciate someone who can hold their ground and knows what they are worth. But it’s important to do it in a polite yet firm way, rather than being flippant or disrespectful,” she adds. 

Talk to your manager first 

“I would always start with your hiring manager, rather than HR.  The moment you go directly to HR, you’re putting it on record. When you take it to your hiring manager, there is room to talk things over with someone who knows you, your work and your potential. At the end of the day, it’s your manager’s feedback on your performance which impacts your appraisal,” says Makhaira. Moreover, if you do decide to leave, they will respect you for giving them a heads-up. Companies do reference checks, so it is ideal not to leave on a bad note or be unprofessional. 

“Respectfully decline the offer if it doesn’t work for you. Recruiters have certain benchmarks that they have to work with, so there is no right or wrong in this situation.” Image: Getty

“Respectfully decline the offer if it doesn’t work for you. Recruiters have certain benchmarks that they have to work with, so there is no right or wrong in this situation.” Image: Getty

Here's your cheat-sheet.

Here's your cheat-sheet.

Use the first offer as a starting point

Don’t take the first offer you get; you have every right to ask for a higher amount if it is justified. More often than not, the recruiter is working with a salary range in mind. “The first offer will usually be at the lower end of the spectrum,” says Talwar, as the recruiter is hoping that you will accept their offer. Negotiating aggressively can send you down a rabbit hole, which is difficult to climb out of,” he cautions.

Also get a sense of how the recruitment process is going, and if the odds are stacked in your favour. “If they are moving through the recruitment rounds quickly one after the other, it means they are keen to close the position, so you might be at an advantage and can use that as leverage,” he adds. Be sure to ask for some time to respond to an offer, so you have enough time to think it over.

In the face of rejection, ask “how” 

Here’s the worst-case scenario—you’ve done everything to get this negotiation off the ground, but failed. Your manager says no, citing anything from budgetary constraints or your failure to meet their expectations, to how you’re already earning more than your colleagues. However, rejection doesn’t always have to be agonising. When put in this situation, Jia Jiang, a TED Speaker and author of Rejection Proof: How I Beat Fear and Became Invincible Through 100 Days of Rejection advises people to use the word “how”. In his post on LinkedIn, Jiang reasons that when you’re faced with a situation like that, it is best to ask your manager how you can get to your goal. Tell them that while you are disappointed, you understand that it is a difficult decision for them. Ask them how you can get a raise as it is important for you to feel well compensated. Listen intently, write down what they say, and send them an email recap as a reminder, he suggests. 

“THE BEST TIME TO BRING UP YOUR RAISE IS DURING THE ANNUAL APPRAISAL WITH YOUR MANAGER”

-Vinayak Talwar

Negotiate beyond money

If your request for a higher salary has been rejected, don’t get discouraged. There are other non-cash components that you can focus on, says Makharia. These could be in the form of a higher designation, flexible working conditions, professional development opportunities, subsidised childcare, insurance, a laptop, transportation allowance, sick leave, junkets or at the senior management level, even stock options. Some firms may be willing to offer signing bonuses for senior candidates. “You can also negotiate a salary structure which will enable you to receive more cash in hand each month. For instance, some employees choose to opt out of provident fund contributions to receive more pay in hand. You could also negotiate the freedom to take on additional projects, keeping the company’s policy in mind,” she says. 

Also Read: The Smart Girl’s Guide to Finance: Why a watch is a sound investment

Also Read: The Smart Girl’s Guide to Finance: How to plan for a sabbatical from work

Also Read: The Smart Girl’s Guide to Finance: How to plan for your retirement fund


Subscribe for More

Subscribe to our newsletter and be the first to access exclusive content and expert insights.

subscribe now