Talking about money can be tough, asking your boss for money can be even harder. But saying what you want, why you deserve it, and what you’ve contributed to your employer can be an important step to achieving your long-term and short-term money goals.
Whenever we refer to pay negotiation, it is important to acknowledge that women are still paid less than men. 14% less on average and the gap is evident across all industries. There is a myriad of reasons the pay gap still exists, but let’s quickly expel the myth that it is because women do not know how to negotiate or because women are afraid to ‘lean in’ and ask for more money. Research shows that women ask for pay rises just as often as men, but they are just less likely to get them. We urgently need a shift in workplace culture and policies to close the gap. In the meantime, we also need to support women to build their skills and confidence to negotiate hard.
The cost of not negotiating is significant. Asking for (and getting) a pay rise every three years can add, on average, an extra 1 million dollars to your take-home pay over your working life. If you’re past the three-year mark, or you’ve recently increased your responsibilities or your contribution, it might be time to ask for a pay rise.
With over eighteen years of experience managing teams, I’ve approved and been the recipient of my fair share of pay increases. Today, I work with clients to outline a clear plan and approach for their next pay negotiation. Each individual, role, and company is different but there are some simple steps we can all take to prepare for our next pay negotiation and to ensure we have the best chance of success.
Here are my top tips for negotiating a pay rise.
1. Do Your Research
Do you know what a good salary is for a person with your level of experience in your industry? If not, research your industry to establish a ballpark of what you’re entitled to. Check salary apps, job websites, and your network to compare the pay scale for your position. As a rule of thumb, it’s appropriate to ask for 10% to 20% more than what you’re currently making.
Show that you’ve done your research, but don’t be afraid to ask for more than the industry standard if you bring something extra to the table — be prepared to clearly identify it and demonstrate the dollar impact this has on the business
2. Know and Speak Your Worth
Of course, everyone would like a pay rise but what have you contributed to your employer that they wouldn’t have been able to achieve without you? For example, increasing the number of direct sales via the website or gaining a certain number of social media followers within a given timeframe.
By creating a list of your achievements it makes it easier to outline the value you have contributed and as such the reasons for increasing your pay. This list, whether you take it into the meeting or not, will help you organise your thoughts and minimise nerves (brain blank, anyone?). It’s much easier to convince your manager for a pay rise when you can demonstrate that you’re excelling in your role and it’s supported with evidence.
I often advise my clients to return to their position description and outline how they have addressed each component of the role within a given timeframe, and how this has financially contributed to the success of the business.
3. Find the Right Time
Timing is everything, especially when you’re asking for a pay rise. Don’t ambush your manager in the office kitchen when they’re trying to get a caffeine fix or throw salary spreadsheets on their desk as they’re about to leave for the day. Asking for a scheduled meeting creates a formality around the request and shows that you’re serious about the conversation. Give your manager some time and even a heads up that you’ll want to discuss remuneration. This will give them time to prepare, rather than feeling like they’ve been put on the spot.
4. Be Direct and Keep it Profesh’
It’s ok to feel uncomfortable discussing your salary, it’s also perfectly normal to feel nervous heading into a discussion. The good news is that you don’t have to feel natural or at ease to negotiate well. The key is to build your knowledge and negotiating skills so that you can present your case clearly and succinctly.
Develop your case before you go into any discussion, arm yourself with evidence, and let the pre-work give you the confidence that you are ready. Be clear in presenting your case and keep it work-related. Everyone has personal stuff going on in their lives but you earned the job based on your skills and your best chance for getting a raise is by demonstrating how those skills have added value to the company. It can be tempting for us to shift towards explaining the reasons that we may need more income -especially those of us that aren’t naturally comfortable with selling our achievements. But talking about how your living expenses have gone up, or how you need to start putting away more money for retirement etc. is a sure-fire way of destroying your chances in most negotiations.
5. Stay Open to Other Options
Maybe your manager isn’t in a financial position to approve your pay rise right this minute but by asking you’ve opened up the conversation. That’s an achievement in itself. Your manager is now aware that you’re looking to push yourself, and that you know your value within the company. By having a pay rise conversation you can open the door to further opportunities such as training and development, flexible working arrangements, mentoring programs, a new role etc. By putting yourself forward, having the tough conversations, and explaining your worth, you’ve already proven your merit and confidence.
Whatever happens, the skill of asking for a pay rise will strengthen each time you go through the process. Whether you get what you’re asking for, somewhere in between, or nothing at all, you will learn more about your role in the company and how you can move forward. Keep an open mind, be clear, be specific and in the future, remember to keep a record of your achievements so you’re always prepared to negotiate your next pay rise.