Top performers generally command higher salaries; however, if they are new to your organization, you don't yet have knowledge of just how well they will perform. Granted, techniques that recruiters and hiring managers use glean useful information from candidates about past performance but there's no way to tell how their skills and performance will transfer to your organization. Therefore, it's prudent to negotiate starting salaries based not on past performance but on the promise of successful performance and on your organization's established compensation and benefits structure.
Instructions
1. Obtain compensation data from your company's files. Generate an employee census report; sort the data by position or occupation, start date and salary. Review historical data about current employees' salary increases and former employees' salaries and increases. For example, if your company routinely gives cost of living increases or salary increases based on performance ratings, this information should become part of the information you assemble to start your starting salary negotiations. Obtain a copy of your organization's compensation budget figures and projections.
2. Access online resources to research compensation data for comparable positions. The U.S. Bureau of Labor Statistics publishes data on thousands of occupations. You can set parameters for your search on salary and wage data according to geographic region. Sites such as Salary.com and Glassdoor.com also have salary information. Be sure the salary information you obtain from non-governmental or unofficial sources is reliable. Compensation and benefits consulting firms typically publish annual salary surveys you can use to support your recommendation for a starting salary.
3. Review the job description for the position that's the subject of your negotiations. Obtain copies of the prospective employee's application documents, including her resume, salary history and other materials that will help you justify the company's position on a starting salary. Schedule a meeting with the prospective employee. Inform her that the purpose of your meeting is to negotiate her starting salary. In all likelihood, she will bring materials she believes are useful to salary negotiations.
4. Engage in a friendly conversation with the prospective employee. Inform him of the starting salary for the position you consider acceptable. Don't start with a salary amount that's lower than the rate at which you would typically start employees in the same job. Just because you are negotiating the starting salary doesn't mean you should low-ball the candidate. In addition, if you offer a salary that's lower than the amount for similarly situated employees, you could expose the company to liability based on pay discrimination. Start with the salary amount you normally would for someone in the same job.
5. Jot down the prospective employee's counteroffers. Write down comments about preferred benefits such as health care, parking, stock options, income protection vehicles and other perks. Compare his list of desired benefits and compare them to any concessions you're willing to consider. Entertain only negotiation amounts that are reasonable and amounts that are close to the base salary for that position. If required, suggest slight increases based on mutual agreement to demonstrate strong performance and concessions the prospective employee is willing to consider regarding company benefits.
6. Initiate two-way dialogue about factors that impact future salary increases, such as performance appraisals, salary adjustments based on temporary and acting leadership roles, differential pay for shift work or work that requires flexibility and on-call status. Explain the reason why salary differentials can increase the employee's pay. Describe the compensation and benefits structure concerning employee tenure, incentives for special assignments and the company's practices concerning regular wage increases.
Tags: starting salary, prospective employee, your organization, salary increases, amounts that, benefits structure, compensation benefits
