5 Things Women Must Consider When Negotiating Salary

Career

Aug 5

There’s no doubt that there’s an issue when it comes to women’s salary in the workplace. Women notoriously make less money than men, and have more student debt than men despite having the same job. The gap exists for a variety of reasons – a huge one being that women are less likely to negotiate than men.

This isn’t to say that women aren’t asking for raises as much as men are. It’s the fact that they aren’t getting the raise that they ask for. Carol Frohlinger, JD, the managing partner of Negotiating Women (a company that was created to train women in the art of negotiation), assisted in conducting a survey of over 500 women asking them their methods of negotiation when it comes to salary. Here were the key findings of that survey:

16 percent of women reported ever negotiating their salary at all
15 percent of women reported that they were confident in their negotiation skills
60 percent of women reported that they take the outcome of their salary negotiation personally

Knowing those outcomes, it begs the question, “Why?”

In 2016, Hannah Riley Bowels, a woman who studies and gives lectures at Harvard on “gender in negotiation,” wrote that women don’t find negotiating salary to be worth it. She claims that most women feel that negotiating their salary will cause them to be ostracized in their workplace. She further claims that they’re correct in their assumption.

In 2018, Benjamin Artz, MBA, Amanda Goodall, PhD, and Andrew J Oswald, Professor of Economics, reported that they found men were successful in their salary negotiations 20 percent of the time while women were successful 15 percent of the time. Their findings supported Bowel’s earlier research in that women were less assertive than men in their negotiations out of fear of social ramifications at work. Essentially, they don’t want to make their boss upset.

As a businesswoman, this information is not only upsetting for the fact that women are making less money than men, it’s upsetting that women aren’t feeling empowered in the workplace.

We’re going to change that.

These five tips for salary negotiation will not only boost your credibility for the raise, it will give you the confidence you need to lay it all out on the table and get what you deserve – for yourself, your family, and all of the other businesswomen out there.

Keep track of accomplishments.

Confidence in your skills is going to help you pay your bills. If you are able to articulate how valuable you are to your company, you’re more likely to get what you’re asking for when negotiating your salary. Depending on the size of you company, the entity that you’re negotiating your salary with might not understand your worth simply because they do not see it. Show them.

Essentially, what you’ll want to do is create is a sort of “resume” for your position. Outline the responsibilities you have, detail how you have excelled within those responsibilities, and note any and all recognition you’ve received. You might want to mention things like how you’ve saved the company money, how you’ve increased efficiency and productivity, new clients you’ve landed, etc.

In addition to recognition, you’ll want to include feedback from leaders and how you’ve internalized that feedback and applied it to your position. Even negative feedback can be a learning opportunity. If you took it as such, be prepared to prove that you can take constructive criticism and grow.

Compare salaries in your industry.

When you’re preparing for a salary negotiation, it’s a great idea to have a salary to compare yours to. Knowing where you fall will help to make your case for why you deserve a higher salary. For example, if there’s someone with your same position and same amount of experience making more money at another company, you should explore that fact and use it to your advantage.

Here are some tips for how to compare salaries in your industry:

Research the market – Search your position and salary on indeed.com, glassdoor.com, etc.
When recruiters come calling, answer – Inquire with the recruiter as to the salary and benefits, even if you aren’t thinking of leaving your current position. It will give you an idea of what else is out there/possible.
Consider geography – When you are conducting your research, pay attention to the average salary in the areas. Compensation will be much higher in cities like San Francisco than in Dallas.

Consider total compensation package.

When negotiating salary, you can’t forget about the benefits that come along with your position.

Your total compensation package is a conglomeration of your salary and the benefits that come along with being an employee of a specific company. When you look at your total compensation package, you may come to realize that the monetary amount of your salary is acceptable (or not) when combined with your other benefits.

In your preparations for salary negotiation, compare and contrast your current total compensation package with that of other companies – especially the ones that offer a higher salary. You may be losing some benefits for monetary gain. The question is, will it be worth it?

There are many areas of compensation that might go into your negotiation including:

Employee profit sharing – In addition to the offered salary, some companies will offer their employees the opportunity to purchase stock and share in the profits. If the company is successful, you can earn an additional salary
Bonuses – According to indeed.com, there are five main types of bonuses:
- Performance-related: when goals are met or exceeded
- Commissioned: a bonus that is tied to the number of sales you make or the dollar amount of those sales
- Contracted: when you are in an executive-level position, you are expected to perform at a higher level. Your exact bonus will rely on a determined set of factors and is not always guaranteed. These may include bonuses for loyalty to the company (retention), growth goals, sales, etc. Typically, contracted bonuses are set to be a certain percentage of your total salary and distributed once a year.
- Non-exempt: overtime pay
- Situational: holidays and events
401k match – On average, companies that match their employees’ 401k will put in 50 percent of every dollar up to 6 percent of the employee’s salary. That means a yearly raise of up to 6 percent.
Lifestyle benefits – these include discounts on things like hotels and flights, phone plans, gym memberships, car payments, tolls, parking fees, and more. If your company covers lifestyle costs, consider how that affects your monthly/yearly budget.
Professional development – this includes education, certifications, conferences, etc.
Health insurance – Consider the type of health insurance that’s offered and the amount of your premium your company is willing to cover.

Remove emotion & be fact driven.

Conducting market research as recommended above should help you become more objective. This is what’s called being competitively intelligent. It removes you from the equation and shows that your desired salary is not a made-up number that you believe you deserve – it’s what your company is offering versus the definitive market value of your specific skill set.

Your delivery will be very important here – be calm and polite, but confident and firm. You’re bringing non-negotiable facts to the table so let them speak for themselves. The facts will prove that neither you nor your company are determining your salary simply by guessing or going off of what “feels right.” It’s based off of your collective competitive intelligence.

Once research confirms a pay discrepancy, it’s time to prepare for the conversation.

Prepare for the conversation.

Ahead of the conversation in which you will negotiate your salary and compensation plan, you may want to ask your boss about key performance indicators (KPIs). These will set the tone for your salary negotiation and help to prove to your boss and the company at large that you can meet goals that are set for you.

After a few months (no more than six) of reaching your KPIs, you should be ready to have the negotiation conversation.

Rehearse your main points to practice confidence – use the “resume” you created as a guide for your conversation. This will ensure that you don’t forget any of your main points and qualifications.
Consider using “we” instead of “I” to create an environment of inclusivity – this will show that you’re an integral part of the larger whole.
Role play with a spouse or friend – it will be especially helpful if you can do this with someone who has negotiated salaries before or plays a part in determining salaries.
Anticipate any objections and determine how you will overcome them – if you have done thorough market research, have competitive intelligence, and reached all KPIs, this should be a breeze.

Take note of when your annual review is coming up – if it’s far out, requesting a meeting to discuss compensation would be appropriate. Otherwise, you can plan to discuss your pay during the review or schedule a meeting with your boss. They should be well aware of your intentions ahead of the meeting so that they can be prepared too.

If you don’t get an answer by the end of the conversation, follow up and ask for specifics. Don’t let your boss get away with being vague about when you will have an answer. Even if the answer is no, you need to know as soon as possible so you can consider your next steps.

As far as next steps go, that will largely be determined on where you see your career going. If you value the company that you work for and your career is about more than the financial compensation, see if you can gauge your probability of earning a promotion soon. Having more responsibility in the company might be worth more to your career in the long term than financial compensation in the short term.

Latoya

Latoya Baldwin