Salary is one of the most contentious topics at work.
Negotiating for a higher salary feels deeply uncomfortable.
The manager and employee perspective tend to be very far from each other.
The manager should be:
- Assessing the current performance level of the employee.
- Looking at growth and development since the last raise.
- Deciding if there’s been an increase in contribution and the value generated for the business by this employee.
Typically, the employee perspective includes:
- Wanting to be rewarded and recognised for their work.
- Difficulty maintaining motivation and high performance if they’re disappointed.
- A desire to see their salary increase as their experience increases.
Here’s the essential tip: If your argument is a list of responsibilities that are key to your job and that you’ve been fulfilling at the same level of performance for years, any raise at all is hard for the manager to give.
This is where your argument could fall through the cracks.
As an employee asking for a pay raise, there’s a lot that you can do before you even start the conversation that can transform the discussion for you.
When you don’t get the raise you expected
Negotiating is hard:
- Talking about money is deeply uncomfortable. Something about asking for money often makes people feel like they’re being greedy.
- It requires assertiveness. If you’re more of an agreeable person, you’re more likely to shy away from conflict or put yourself in these situations where there are opposing sides.
- Self-assessing the value of your work isn’t objective. How do you know if you should be asking for more money? How do you know if you’re contributing more than you’re getting paid for? In most companies, there’s very little salary transparency.
- Dealing with little salary transparency. Minimal structure in your company could also translate to not understanding what types of skills you need to develop and what kind of contribution they’re looking for when they’re considering paying someone a higher salary.
- Managers typically don’t articulate clearly what conditions are required for a higher salary. Deciding on a salary is often a mixture of different factors and explaining these factors completely in a way that’s comprehensible to the employee is complex.
External circumstances could make this even worse.
For example, there may be generational differences in salary (earlier employees got paid more). Even if you know how much you’re getting paid in comparison to your colleagues, that might no longer be in line with what the company is willing to pay.
How could I ask for more money?
There’s nothing wrong with wanting to earn more money and to better yourself.
Earning more money can have a huge impact on your life when it comes to your living standards, your investment opportunities, your independence, your goals, and the life you’re able to provide for your family.
A higher salary is often an indication of progression: you’ve levelled up in one aspect and one area of your life. That’s something that you can be proud of.
This is what would happen if you’re successful.
The point of the advice below is to increase your chances of success as much as possible.
That said, whether you’re successful or not, the act of asking alone is a way to take a step forward and learning to negotiate on your own behalf. Asking for a pay raise is a way of advocating for yourself and looking out for your future.
Some of the content here is around figuring out whether you should even get a pay raise or not and building a case for yourself. Going through these steps, in general, is a great way for you to understand where your performance level is at, what the usual salary range for your position is, and what your chances of getting paid more are.
This is research that will pay off in your future, even if it doesn’t work in your current position. You can use this experience if you ever have to change jobs, too.
How to ask for a pay raise
The essential steps to ask for a pay raise are:
- Create objective performance criteria.
- Research the salary ranges for your position and market.
- Break down your own contribution to the company.
- Understand how salary negotations are managed at your company.
- Set personal targets for your salary.
- Decide on the raise (if any) you’ll ask for.
- Prepare a list of arguments.
- Talk to your manager.
Create objective performance criteria
The most difficult prerequisite is being objective.
Everything else, in terms of doing research, being prepared, and how to have the conversation itself, will be very hard to do, if you are not approaching it from the most objective mindset possible.
Being totally objective is obviously impossible, to a certain extent, because you will be assessing your own performance and deciding what kind of salary you, personally, feel that you deserve based on that. Whatever you can do to make that assessment as objective as possible will have a huge impact on the likelihood of success.
There’s a tendency to say “I deserve more money because I’m working incredibly hard and I’m doing the best job I can.”
This isn’t a bad tendency, in and of itself, but it isn’t enough.
- You need to be able to demonstrate value that everyone around you recognises.
- What’s the actual, visible impact of you working incredibly hard?
- You need to find a way to separate your own personal investment in the outcome of this conversation and this objective assessment of your performance.
- That means developng enough emotional distance to be able to have the conversation even if it isn’t heading in the direction that you want.
Build an external persona
Imagine someone else in the same position doing a perfect job. What does doing a perfect job look like?
- Define this on a per-task basis.
- Then think about all of the other aspects of your job that aren’t task-based: teamwork, giving and receiving feedback, living your company’s values, impact on your own team and on other teams.
- Use this to develop a set of criteria, by which you can judge and assess performance in your position.
- Now that you have these criteria, try to think about your performance in comparison to them. What aspects are you great at? What are you not so good at?
Getting used to thinking about your performance from this lens should make it easier to handle the whole conversation.
For all this conversation will feel immensely personal, remember that your manager and company have other aspects that they have to take into consideration, many of which will never be fully transparent to you.
Approach it as a learning exercise and try to learn from the experience. Do your best to not get hung up on the outcome. It would be great if it works out! But it’s okay if it doesn’t because you’ll hopefully learn what you need to do for the future.
Research salary ranges
Try to find out what the salary ranges for your position are. Try to also search for your industry, field, and area.
Since salary ranges differ dramatically depending on where you’re located, it makes sense to consider that as well.
If you’re lucky, your company might already have salary ranges that are transparent to everyone. This is a great starting point but take the time to do independent research as well. You want to get example ranges from multiple different sources, just start by using Google and see if you can identify a few sources that seem reliable.
You should have an idea of what the usual range is for your position. Ideally, your current salary should sit somewhere within that range.
- If it’s already in the high end of the range you find, you will likely have to make an argument for why your contribution is even higher than the expectations of your position.
- If your salary is rather on the lower end, you’ll hopefully have an easier time making the argument that your contribution is worth more.
- If your salary is even below the lower end, you can make an argument that you’re actually underpaid for your position in your industry.
Break down your own contribution
This is the point at which you can start looking at your own contribution. Break down the value that you bring to your company. There are a lot of different aspects to this but here’s a starting point:
- Experience. How many years have you been working in total? How many years have you been working in this industry or this position in your company? Is there anything unique about the experience you have to date?
- Education. Education includes degrees, certifications, and courses as well. If you’re actively investing in your education and you have paperwork and documentation that back that up, that’s something to include here.
- Unique skill set. This is essentially the outcome and combination of the above two points. What skills do you have? What can you do really well? How easy is it to develop those skills from scratch?
- Performance. What would it take to bring your performance to the next level? Are you a high performer or an average performer? Be as honest as you can be with yourself. In an ideal scenario, your perception of your performance should always be pretty close to your manager’s. If that isn’t the case, that’s something you have to address with them.
- Responsibilities. What are the tasks that you do on a day-to-day basis? Have they changed or grown in complexity since your last salary discussion?
- Impact. What is your impact on your team and the people who work with you? Would they notice if you weren’t around? Does your team work better when you’re around? This is another huge lever when it comes to salary discussions.What is your impact on your team and the people who work with you? Would they notice if you weren’t around? Does your team work better when you’re around? This is another huge lever when it comes to salary discussions.
Say your performance is stable and your responsibilities haven’t grown. You can only base your argument on experience. This isn’t the strongest argument if you aren’t able to demonstrate how that experience resulted in an improvement.
Growing in responsibility doesn’t have to translate to managing people if that isn’t where you want to go. It can mean managing tasks, growing in expertise and therefore becoming better able to help other people in your team, or taking ownership of certain areas.
Ultimately, you need to use these factors to demonstrate that there’s been a development since your last raise.
Understand salary negotiations in your company
Before you sit down and talk to your manager about your salary, find an opportunity to talk to them about salaries in general.
Many of the misunderstandings and conflicts I’ve seen happening around this topic are because people don’t start on the same page, so the communication gets very confused.
- Under what circumstances does your company generally provide a pay raise?
- What do they take into consideration?
- What kind of structure do they have around it?
- How do they ensure fair pay?
- What kind of pay raise do they give to denote “good job, we’re happy with your performance” versus “great job, we’re impressed with your performance”?
Every manager or HR department should be able to have that conversation with every one of their employees.
The point of this isn’t to interrogate your manager or to question them thoroughly. Sometimes, especially if people are taken by surprise and aren’t prepared, they won’t have great answers for you. Your approach should be curiosity and open-mindedness.
The great thing about having this conversation before making any requests is that your expectations will be more realistic. If your manager says “usually a 10% pay raise constitutes significant growth in terms of responsibilities,” you’ll know if this is a requirement that you meet.
The best outcome would be to walk out of it with an idea of how your manager and your company approaches salary negotiations.
One of the more frustrating experiences I’ve had was with a member of my team, who built a completely false impression about pay raises in the company based on someone else’s experience. This is very easy to avoid
Set personal targets for your salary
It’s incredibly difficult to understand exactly where you want to be, in terms of salary. It’s also hard to link that to what is realistic for you in your current position and in your current company. Most of the limits that come your way aren’t explicitly set, but you should always go into it with the expectation that there will be a salary cap somewhere. There are two things that you should try to set as targets for yourself:
- What is your ultimate goal from a salary perspective? How much money would you like to be earning from working full time?
- What is the maximum that you can expect from your current position?
If you’re approaching this from a different perspective because you feel underpaid, then define your minimum acceptable salary and be honest about it. It’s extremely demotivating to work somewhere if you don’t feel like your work is valued and that you’re paid unfairly. It will be a draining experience, not only for you, but also for the people who work with you.
Decide on the raise you want
Now you have a ton of background information that you can pull into making this decision.
- The first decision is whether you’ll ask for a pay raise or not.
- The second decision you need to make is how much of a pay raise you’d like to ask for.
Salary is a qualitative measure of the value you represent for your company.
Can you definitely say that you bring more value to your company now than you did whenever that last discussion happened? If yes, then you should ask for a pay raise.
If your answer is maybe or you’re rather leaning towards no but you’d still like a pay raise, you should approach the conversation from a totally different angle: look for ways to develop first. Talk to your manager about that instead.
The only right time to have this discussion is when you can definitively say you’re providing additional value now.
Prepare a list of arguments
The crux of your argument should be something along the lines of “I am more valuable to the company now than I was when my current salary was decided.”
- You should be able to demonstrate exactly how you’re more valuable to the company now.
- Lean towards providing objective facts, not subjective impressions.
- Provide specific examples. For example, your argument shouldn’t be “I’m a hard worker and you can see that in my everyday work.” It should be, “As you could see from my work on this project, it was successful because I did the following things, and developed and brought in the following skills.”
You want to have around 3-4 strong points with specific examples that you can fall back on.
One of the difficulties here is in avoiding giving the impression that you’re only doing certain things to earn more money.
- Don’t list every single, small thing you’ve done that might be construed as additional to your day-to-day tasks like, “I help my colleagues when they have questions.”
- Avoid falling back on a performance level that’s simply part of your job. For example, if you work in a Support team, an argument on the basis of “I answer tickets” is not convincing. The current base salary that you earn already covers that.
I’ve asked people in my teams to do this in the past when they’ve asked for a higher pay raise than I originally offered. Some people reacted to that with aplomb. Most people gave me feedback that having to do this made them feel undervalued and unappreciated.
This might be a feeling that you have at this point: Why does it take so much effort to ask for a pay raise? Why can’t your manager simply say yes?
The simple answer is: They have a duty towards the company as a whole and payroll is the most expensive cost the company has. Managing that inappropriately can have major consequences on the company as a whole.
In an ideal world, no one would ever feel underpaid and there would never be mismatches between what a manager considers a fair salary for someone and what that person thinks is a fair salary for themselves.
But salary negotiations are rarely that straightforward.
Even if you have a ton of salary transparency in your company, with clearly defined structure and salary bands, there will still be disagreements about where a person sits within a range. Learning how to do your own independent research, and how to break that down into a negotiation in your favour is how you set yourself up for success.
Talk to your manager
Set up a meeting with your manager.
- You can either follow your company’s regular cadence (most companies usually have a salary discussion once a year, in an annual review).
- Or you can set up an individual meeting for it. To do so, just tell your manager that you’d like to talk about your salary, so they’re prepared when they go into the discussion.
During that meeting is when being objective, articulate, and calm really matters.
- Start by saying that you’d like to get a pay raise.
- Ask for a specific amount and then explain why you think you should get it, as openly as you can.
- You can talk about the research you did coming into it but focus on your individual contribution and your impact.
- Try to cut yourself off if you find yourself rambling. Focus on making the points that you prepared and then wait and listen to the response.
If the answer is a no at this point, try not to get angry or frustrated by it. Your preparation until this point was still valuable and useful. Treat this is a good opportunity for you to understand if there’s something else you missed.
Maybe your manager is taking something into consideration that you haven’t thought about. This is when you can learn it for the future. In this case, you want to walk out of this meaning with a clearer idea of what you would need to do to earn more money in the future.
If the answer is a yes, then congratulations! Your efforts paid off.