Feeling overworked and underpaid? Join the crowd. In a March 2016 article from Fortune, only a little more than 1/3rd of Americans feel they are paid fairly. As an HR Representative counseling employees, I often hear a multitude of reasons why people are unhappy to some degree with their salary. From the perception to being “on-call” all of the time, to doing more than what their manager realizes to just plain feeling undervalued, employees are starting to wonder how to take steps to ask for more money.
Before you barge into your manager’s office demanding more money with little to know argument to back up your request, which never works out well for anyone, I strongly urge you to do the following.
Do your recon.
First, you need to do a little reconnaissance. Schedule a meeting with your Human Resources department and tell them you want to discuss your compensation. You need to find out if the company has a compensation philosophy, does the organization tend to pay above market, do they pay to meet market averages or do they lag the market? A lot of companies right now are opting to pay median salaries, giving raises each year that just beat cost-of-living inflation, while awarding performance with discretionary bonuses. This is a less riskier option for companies than awarding high salaries in a ever-changing economy that can render a business obsolete in 6 months. Ask HR how the company recognizes performance. You also have to consider how your company is doing overall and where your company is in its life-cycle. If your company is in start-up or decline mode, they likely do not have the capital to be throwing around on employee raises. As the old saying goes, you can’t get blood out of a turnip. Other questions that are helpful to ask are if your company assigns salary ranges to each position and where your position lies on a career track (junior, mid-level, senior-level). Also ask your friendly HR professional for his or her recommendation on how to approach a salary review or request inside of your organization. Any HR practitioner worth their salt, will be able to give you an honest response. If your HR rep is squeamish about your questions, that may be a red flag that your company has an old-school mentality around compensation transparency which still isn’t all that unusual to encounter these days. Yet, it’s good to know this about your company.
Next, you also need to do some external market research. You need to hit the internet and find out what data is available on salary ranges for your position, think payscale.com, glassdoor.com and onetonline.org. But heed caution here and build in a margin of error. These websites usually cite self-reported data and individuals usually inflate their salaries when asked. Additionally, these sites do not take into account certain nuances that make an apples-t0-apples comparison very difficult- different geographical regions, international versus regional organizations, successful versus declining companies, and booming industries versus dying industries. You may also want to reach out to recruiters in your area or network and ask them what they see is the going rate for your position. But, proceed with caution for the same reasons stated above. Also, don’t forget the monetary value of your benefits. The company probably pays for a portion of your health insurance and matches your 401(k), even though this isn’t money deposited in the bank every 2 weeks, doesn’t mean it isn’t compensation. You need to figure out the value of your benefits as part of your total compensation to understand what you are truly being paid to do your job. Now, with this information, you can create an acceptable range of what you think your position is worth.
Once you have done all of this stuff, you are ready to put your plan into play. Tune in on Thursday for How To Ask For More Money, Part II.