Career Negotiations Podcast

Salary Negotiation - How to Negotiate a Job Offer Salary

• Brandon Bramley

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Do you know how to negotiate a job offer salary? In this episode, I break down job offer compensation, my proven step-by-step salary negotiation strategies, and some common mistakes to avoid during a salary negotiation.

That way you have salary negotiation advice that is based on hundreds of job offer negotiations and actually work.

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WHO AM I

I'm Brandon, the Founder and Lead Negotiator at TheSalaryNegotiator.com. As a former corporate negotiator, I now help employees increase their compensation. Through hundreds of salary negotiations, I've helped career professionals secure over $175 million in additional compensation. My expertise is backed by more than 150 five-star reviews from career professionals on Google and Trustpilot.

Brandon Bramley:

Most companies provide competitive compensation of personal employees, but how do you know if you're getting a job offer that's competitive before you accept?

Brandon Bramley:

In this episode my goal is to cover everything you need to confidently navigate a salary negotiation. I'll first cover the compensation structure at most companies so you know more about the base salary, bonuses, equity packages and sign-on bonuses in your job offers. That way you know exactly what to expect in the offer letter you might receive. Then I'm going to walk you through my five recommended steps for negotiating a job offer that are proven through hundreds of real salary negotiations that I've led for my clients. That way you can filter out the bad advice out there and use salary negotiation strategies that actually work. And I'll close out the episode by highlighting three common mistakes you should avoid in a salary negotiation. That way you don't risk the opportunity and do actually secure a competitive compensation. So let's get into it. Hey, everyone, welcome back to the channel If you're new here. My name is Brandon Bramley and I'm the founder and lead negotiator at thesalarynegotiatorcom (https://www. thesalarynegotiator. com/). I provide professional job offer negotiation coaching, salary negotiation courses (https://www. thesalarynegotiator. com/courses) and tools (https://www. thesalarynegotiator. com/salary-negotiation-templates). To help professionals like you navigate the negotiation process and secure competitive compensation. I'm not just a career coach or recruiter giving out generic salary negotiation advice. There's already enough bad advice floating around online. Instead, I personally led hundreds of salary negotiations across various roles, helping my clients secure hundreds of millions more in compensation. My background is in strategic negotiations and my goal is to debunk the bad advice out there and give you proven salary negotiation strategies that are actually going to help you earn more. So if you're a career professional looking to earn competitive pay, subscribe here for actionable tips (https://www. thesalarynegotiator. com/store/counteroffer-examples) and, when you're ready to take your negotiations to the next level, visit the thesalarynegotiatorcom for coaching, courses () and tools () designed to help you navigate the best possible.

Brandon Bramley:

Now, before we dive into how to negotiate offer letters, let's talk about the compensation components. It's really important to understand the difference between base salary and total compensation. Too many people focus on only the base salary for a role, but that's just one piece of the puzzle when it comes to pay at most companies. When considering a move to a new company, need to look at the whole picture your total monetary take-home pay, also known as your total compensation. This includes your base salary, annual bonuses, the value of any vesting equity each year and any sign on bonuses.

Brandon Bramley:

Now you might find four different compensation components in a new job offer. First, there's going to be a base salary. This isn't new. This is your consistent guaranteed pay that you'll see in every paycheck at most companies. It's really only going to change if you get promoted or if you get a merit increase each year, since it's a set rate, so I won't spend too much time there. Second, you might have an annual bonus, which is usually a percentage of the base salary. This percentage can range depending on the type of role and the specific level. It's typically based on personal or company performance each year and it's paid out annually, so it can fluctuate, while the bonus is usually tied to your base salary. It's generally not negotiable at most companies, but if you negotiate a higher base salary, the bonus will typically increase along with it.

Brandon Bramley:

Third, you might receive equity at the new company. It usually is going to come in the form of either restricted stock units RSUs or employee stock options. Rsus represent actual stock, which means you receive shares of the company stock outright. Once vested Stock options give you the right to purchase company stock at a predetermined price, for example, you have to pay or exercise these options to receive the actual shares. They're not usually given for free Employee equity grants are going to come with a stock vesting schedule, which means you're going to need to wait for the equity to vest according to that schedule before you actually own the shares or options.

Brandon Bramley:

Most stock vesting schedules are going to be between three to four years, with equity vesting and increments over that time. The stock vesting schedule may be evenly distributed or staggered. So, for example, facebook's RSU vesting schedule is a four-year period with equal annual vesting, meaning 25% vest each year. However, you might find a staggered approach for the Amazon RSU vesting schedule where 5% vest at the end of year one, 15% at the end of year two and 20% every six months until after the end of the four-year vesting period. So companies will have their own specific vesting schedule.

Brandon Bramley:

You don't get the full value of equity upfront, but you do share in value fluctuations over that period. If the stock goes up, so does the value of equity upfront, but you do share in value fluctuations over that period. If the stock goes up, so does the value of your equity. The flip side is also true, that if the stock price goes down in the company, your equity value is going to decrease as well. So there are risks when you get equity in a company. Also, it's important to note that if you do leave before the equity fully vests, then you're going to forfeit that unvested portion when you do leave.

Brandon Bramley:

Finally, there's usually a sign-on bonus at most companies. This is usually a one-time cash payment that is typically paid out 30 days after you start. It's often designed to offset loss incentives or equity from your previous company, or is it just an incentive to join the new company? Sign-on bonuses aren't always included in the initial offer at most companies, so they're usually going to often require salary negotiation. Luckily, I've had great success in securing these for my clients. Some companies that offer equity might also provide an annual equity refresh, which are essentially additional equity grants each year, whether that's more RSUs or more stock options. However, stock refreshes aren't always guaranteed and can vary significantly, so we don't typically include them in our total compensation calculation. However, it is worth asking the recruiter about any stock refreshes, but since they won't usually share specific details or give you the guarantee, we don't count on them. Now, these four main salary components your base salary, annual bonus, equity and sign-in bonus are gonna make up the total compensation at most companies. To help you visualize this, we have a total compensation calculator on our site. It lets you input your base salary, the bonus percentage, equity grant and sign-on bonus, then shows your estimated compensation over four years, both in total and on an annual basis. You can find our free total compensation calculator (https://www. thesalarynegotiator. com/total-compensation-calculator) at thesalarynegotiator. com, and I'll also link to it in the episode notes below so you can have this free tool All right.

Brandon Bramley:

Now that we've covered how most compensation structures work, let's discuss the salary negotiation steps. These are strategies I've used to successfully negotiate hundreds of job offers and I recommend you follow them to navigate the salary negotiation once you have an offer in hand. Once you have a job offer in hand, the first step to negotiating is making sure you fully understand the compensation components and benefits in the offer package. The biggest takeaway from this is that understanding the total compensation before negotiating is very important. That way, you know exactly how to value the offer and what to negotiate, including the base salary, annual bonus, equity and ending sign up bonuses.

Brandon Bramley:

The second step is what I call doing your due diligence and asking strategic questions. This is where you review the offer and come back with a list of questions for the recruiter. This not only helps you clarify any questions you might have about the offer, but it also allows you to strategically ask questions that will build negotiation leverage. You can call it things that might not be as competitive as your current company or what competitors offer. If you do need some ideas, you can grab some of our strategic questions to ask from our templates page or course. That way you have exactly what you need. But I really want to highlight that you don't skip this step, even if you think you understand the offer and have all your questions answered. This step is very important for building negotiation leverage by showing you're doing your research and due diligence on the offer before sending a counter offer. That way, you're not sending a counter offer out of left field, just reaching for numbers that might not make sense, and it's also going to help you avoid any trade-offs that the recruiter might introduce later on in the salary negotiation. So make sure you do this.

Brandon Bramley:

The third step is to do the compensation research and find the base salary and the total compensation ranges for your specific role, location and level at the new company. You can use various online resources to find this data, but make sure you use multiple sources and average the results. We're essentially trying to find the compensation ranges so we can see where your initial offer sits and how much more room there is for improvement and negotiation. Most companies are going to try to hire employees at the lower to mid end of the pay bands, but I always suggest pushing towards the top end of the pay range for your role, based on the data. Just remember, this is publicly reported data, so it might not always be accurate. People may have reported higher equity than a new hire would get due to stock appreciation or they may not have uploaded the compensation correctly. So if you want help with this, you can either work with this directly or you can use our compensation research comparison tool.

Brandon Bramley:

Once you have the compensation research done and you've got answers to your questions, you're ready to draft a counteroffer. This is where we take a database approach and craft the counteroffer to send to the recruiting team. We'll present the top end of the range that you are targeting based off your research and call out any items that weren't competitive based on your due diligence questions. I highly suggest doing this by email because it gives the recruiter everything they need to advocate for you and they can simply send your points to the comp team instead of just hoping that they're going to note your comments down on the call Plus. Recruiters negotiate offers every day, so they'll be ready with negotiation tactics to cut you off or steer you in a different direction if you try to counter on the phone. So I always recommend email.

Brandon Bramley:

The final step after sending a counteroffer is to be prepared to handle any recruiter pushback. It's almost guaranteed that you're gonna get pushback from the recruiting or hiring team. Most recruiters are trained to deter you from negotiating and get you to accept the initial offer. So be prepared for that pushback and know exactly what to say to overcome those objections and pushback and actually get them to take your concerns back to the comp team. Essentially, you want to say that you understand their concerns, but nicely reiterate yours and ask them to take your ass back to the compensation team for another look. It might take overcoming a few objections, but once they agree to take it back for another look nine times out of 10, they'll come back with a better offer. We have our full list of objection handling responses on our templates page and in our course (https://www. thesalarynegotiator. com/salary-negotiation-course) for download. If you do need these scripts and you want to know exactly what to say when you encounter recruiter pushback, so feel free to grab them, but from here the recruiter will either come back with a better offer that fits your needs or maybe something that's lower than your ass.

Brandon Bramley:

At that point it's really up to you to decide if you want to send another counter offer or if you're ready to accept the updated offer and get it locked in. Just note that negotiating salary is not like some of the back-to-back negotiations you've seen in the past or maybe experienced at a car dealership. Okay, there's really not a lot of back and forth and you really don't want to send more than two counter offers. Otherwise, you do risk coming off as aggressive and you might jeopardize the relationship. Now the last thing I want to cover is a few salary negotiation mistakes before you decide to negotiate a job offer.

Brandon Bramley:

The main item I recommend against is sharing your salary expectations or current pay with the recruiting team (https://www. thesalarynegotiator. com/resource-center/salary-expectations-answer-on-application). This can only work against you. Think about it. If you throw out a number that's lower than what they could offer, you're probably going to get a less competitive compensation package at the low end of their pay range, or you run the risk of being down-leveled, which is very common at tech companies. So you don't want to get down leveled by sharing lower comp than they might provide. And on the flip side of that, if you think it's a good idea to throw out a high number, thinking that's going to help, they might think, shoot, I'm not sure if we can afford this person, so let's go with a different candidate instead. So it's not a good strategy. And remember the recruiter knows exactly what they can pay for the role, so you always want to turn that question back on them and learn more about the base salary and the total compensation ranges for the role.

Brandon Bramley:

The second mistake to avoid is making sure that you're realistic about what you should ask for in the counteroffer. Too often do I see people ask for way too much, which just doesn't make sense. They either get laughed at or, if it comes off as too aggressive, or in some case cases you might even get the offer rescinded by asking for way too much. So you want to avoid that and you should always take a data-based approach to ensure you're asking for realistic comp that they can actually provide. At the end of the day, each company has a set compensation ban and they'll only pay within those bans for the specific role and level. So don't jeopardize an offer by coming off as too aggressive and asking for unrealistic numbers. It just doesn't make sense.

Brandon Bramley:

And finally, don't be worried about a salary negotiation. You might feel nervous, but as long as you follow proven strategies and keep the negotiation kind and professional, there's no reason you'd risk the offer. If you do it right, you should secure a more competitive offer package before you start your new role. So have confidence in this, but make sure you're following proven strategies or getting professional support if you need help negotiating your offer.

Brandon Bramley:

That wraps up this episode on salary negotiation. I hope this breakdown of compensation packages at most companies, our proven salary negotiation strategies and offer negotiation mistakes to avoid help you feel more confident in these discussions. If you are serious about getting the best possible offer, I highly suggest you don't go into the salary negotiation alone. Head over to the salary negotiator to either work with me directly as your salary negotiation coach or check out my salary negotiation courses (https://www. thesalarynegotiator. com/job-offer-negotiation-course) and tools (https://www. thesalarynegotiator. com/resource-center/salary-negotiation-how-to-negotiate-offer-letters). You'll find all the links in the episode notes below to help you with your negotiation and if you found this episode helpful, make sure to subscribe, leave a comment and please share it with someone who could use this advice in their career. Thanks for tuning in and happy negotiating.

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