During the hiring process, one of the most complex – and potentially sensitive – steps employers need to complete is negotiating the salary with the chosen candidate. Often, a small misstep can have serious repercussions, possibly altering how the job seeker views the opportunity and your company as a whole.
Ultimately, getting the salary negotiation phase right is essential. To make that easier, here are some dos and don’ts of salary negotiations for employers.
Do Adjust Your Mindset
Many hiring managers approach candidate salary negotiations in a specific way, typically aiming to secure the best professional at the lowest possible cost. The issue is that, while money isn’t everything to candidates, it’s always important. By attempting to drive the compensation down too far, employee dissatisfaction may occur surprisingly quickly if they accept.
Instead, aim for a happy medium. Provide enough compensation to ensure the new hire is motivated to give their best work, as that extra investment can result in significant productivity gains, making it financially wise.
Don’t Skip the Research
Before you present a job offer and engage in salary negotiations with a candidate, don’t forget to do some research. Check the going rate for similar positions at competitor companies in your area. Additionally, if this role is comparable to the last one the job seeker held, dig into the new hire’s current or most recent employer to gauge what they were making previously.
Through research, you can determine what pay rate is competitive. Plus, it can help you ascertain the candidate’s expectations, as they’ve likely gathered similar information.
Do Talk About Salary Before the Initial Offer
Many companies avoid discussing salary until a job offer is in the works. However, by asking candidates about it toward the end of an initial interview, you can get a feel for what they’re after earlier in the process. In turn, that lets you focus your attention on job seekers who are open to salaries in the range you’re able to support.
If you listed the salary range in the job ad, you could simply confirm that the candidate is comfortable with that range. Ask that question near the end of the first interview. Along with letting you know that they find what you’re prepared to offer reasonable, it allows you to determine if a job seeker may not have thoroughly read the vacancy announcement, as those who say they were hoping for something else applied without factoring in the information you provided.
Don’t Negotiate Salary Alone
While salary negotiations are primarily about pay rates, many companies also have some leeway when it comes to other benefits and perks, some of which may be more affordable to offer. As a result, don’t focus solely on salaries when negotiating. Instead, discuss the total compensation package, as you may be able to find something mutually agreeable.
Do Speak Honestly
If a candidate is asking for a pay rate outside of the norms in your area and it’s genuinely unaffordable, say so. Ultimately, there’s no point in negotiating if the job seeker has a line in the sand that you can’t support. It’s much better to be upfront if you’re clearly too far apart. Then, gauge the candidate’s response to that information to determine if further conversation is wise or if you’re better off moving on to another job seeker.
Don’t Negotiate for the Sake of Negotiating
When a candidate presents a counteroffer after receiving your initial offer, don’t assume that you need to respond with something different. If what the job seeker presents falls within the approved salary range, simply accept. That gives the candidate a perceived win. Plus, it shows that your company is reasonable. Finally, it makes the entire experience less stressful and faster, which is a win for you both.
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If you’d like to learn more about effective salary negotiation techniques, the team at GoSource wants to hear from you. Contact us today.