5 Real-Life Salary Negotiations (And What You Can Learn From Them)
If you didn’t negotiate your last salary or haven’t asked for a raise in awhile, you probably used one of these excuses:
- The timing just isn’t good right now
- I work for the government, so I can’t really negotiate
- This is my first job, so I don’t want to ask for more and lose the offer
- The thought of negotiation makes me anxious… I don’t know what to say
However, none of those reasons means you should avoid asking for what you’re worth. Negotiating for your salary is the best per-hour rate you could ever hope to find. With a few hours of prep work and a short meeting, you can increase your yearly pay by leaps. All it takes is the right mindset and a willingness to squash excuses—and we set out to prove it.
Below, I’d like to share five real-life salary negotiation case studies from creatives that stretch across a variety of situations, and one of them is likely similar to your own. I invite you to be a fly on the wall for these real-life negotiations.
(Note: Names and personal information have been changed for privacy reasons, but specific numbers and results are the same)
Case 1: Derek
Can you really negotiate with tiered levels and red tape?
Current pay: $92,000 ($80,000 base + 16 percent bonus)
Background: When you think of a “very large regulatory enforcement agency,” words that come to mind include bureaucracy, red tape, tiered compensation levels, and politics. True to form, Derek’s situation did not disappoint.
Not only was Derek moving from one government-like agency to another, but he was also moving across the country. His experience meant that he would be either a “Level 9” or “Level 11,” and on the initial application, they asked what the lowest “level” he would take. (For context, a level 9 paid between $63,000 and $96,000, while Level 11 paid between $73,000 and $125,000). Loaded question, right?
For those in “normal” corporate jobs, that’s like being asked what the lowest salary you would agree to, which is never a good thing. But in his case, it’s often strategically smart to come in at a lower level, since it gives more room for raises and promotions, so he said Level 9.
Derek told me, “Resumes just get swooped up in a big search, so I always put the lowest level to try to get my foot in the door, thinking I would start at the higher end of the 9 range if that’s what they give me.” But during the course of their talk, HR agreed that his experience would definitely put him into the Level 11 category.
When Derek finally received an offer, he was shocked. They put him at a Level 9, offering a salary of just $70,000 with 15 days vacation. This didn’t make any sense at all since HR said he was a Level 11, they knew he was making $80,000 to $90,000, and he currently had 20 days of vacation.
At this point he was told he needed to contact a hard-to-reach Senior Executive. Here is some of the strategy we talked about:
- Don’t take an attitude of anger at the low offer, but rather, approach it in terms of genuine surprise, appealing to the senior exec for help in trying to figure out how to proceed (assuming that there even was some kind of error here).
- Understand your audience. Knowing that the executive was a lawyer by trade and valued facts and figures, Derek honed in on the specific details at hand: He DID have the training and experience to be a Level 11… HR DID say in their meeting that he should be placed at the higher level.
- Come from a place of honesty. He genuinely wanted this new position and thought it was a great fit, but clearly taking a $22,000 pay cut and less vacation didn’t make sense.
- The executive agreed that HR didn’t give him some credit for previous experience, but there were certain specifics that would keep him at the lower level.
- However, they went ahead and increased their offer by $17,000—about 25 percent more than the previous offer—going from $70,000 to $87,000.
- He also noted that HR “was overwhelmed” and it might take awhile for everything to be official—perhaps even until the end of the year.
- Derek’s base pay increased by $7,000 and the new job had better benefits like student loan repayments and scheduled raises, which would quickly add to that total. While the total compensation in his last job would have been higher if he stayed on another four months to get his bonus, this was a job Derek truly wanted and he was ready to move on as soon as possible.
Job seekers should avoid believing blanket statements like, “You can’t negotiate jobs that have tiered levels, like the government, non-profits, or education.” Maybe it’s harder, maybe it can’t be done in many cases, but for Derek’s situation, there was actually a massive range available. All he had to do was ask. Remember: A level 9 paid between $63,000 and $96,000, while Level 11 paid between $73,000 and $125,000. Plenty of wiggle room there.
Start: $80,000 plus bonus
After: $87,000 plus student loan repayment and scheduled raises
Case 2: Susan
Do you risk losing the job or looking entitled if I try and negotiate my very first job offer, especially at a startup?
Current offer: $17 per hour (about $34,000 per year), plus overtime, medical/dental benefits, 2 weeks vacation, 11 holidays, and 5,000 stock options
Background: When I first connected with Susan, she was fully immersed in her very first negotiation. She’d landed an interview at an amazing startup that she was dying to work for, and was thrilled at the prospect of her very first job.
After initially (and wisely) evading the topic of salary early in her interview, she was talked into giving an estimate and said $45,000. She had in-person interviews, they were calling her references, and then they said she’d have an offer that week. As luck would have it, the offer came through via email the night before we spoke on the phone.
Unfortunately, the offer was about $10,000 below her desired goal—about $34,000—but she was eager to join the company and the benefits were great. In addition to fully paid medical and dental (including a $0 deductible), there was the chance to clock some overtime and long-term upside of stock options. She wanted this job.
Still, she knew that companies rarely put forth their best offer first, so she wanted to at least try and negotiate, and perhaps ask for other benefits like a monthly subway pass.
- Set aside your biases. The first step was addressing Susan’s fears and adopting a negotiation mindset. Nearly all job-seekers are nervous about asking for more, and that is only compounded when:
- It’s your first negotiation
- There’s enormous pressure from friends and family to get that first job out of school when you haven’t worked in four months
- You don’t want to look ungrateful or entitled
- The company is a startup
However, know that companies expect candidates to negotiate, so if done the right way, there’s little downside.
- Offer quantifiable reasons why you are worth more. Because the offer came via email, we decided to respond via email. I had Susan do some additional research on her worth on the market, and clarify the unique skills that she would be bringing to the job.
- Be professional, even if the workplace is friendly. There were a few instances in Susan’s first draft where she was too casual with her language. While it’s ok to show your personality and a bit of humor, remember that this is a business transaction so keep things light, but save the jokes for later.
For example, she had the phrases “Consult with the parental units” and “Something my parents mentioned that I don’t think we’ve had a chance to talk about is a retirement savings plan.” I put on my Millennial vs. Generation X hat, and told her that as of this moment she was now a professional making her own adult decisions... SHE is in charge of her career, her raises, and her retirement, not her parents. It’s 100 percent acceptable to talk to your parents about these questions, but it’s not appropriate to mention them in a business context like this.
- Eye an incremental raise from the initial number. Originally, Susan planned to show that her research was between $35,000 and $52,000, and ask for the middle of that range. Because that median number ($43,500) would be a significant 28 percent increase over the initial offer, I advised her that it would be too risky to do so. Remember, our number one priority was to secure the dream job, while then trying to increase the salary. If they saw a number in the $50,000 range that was more than 50 percent more than their offer—even if trying to get below that—there was a chance it could set off the “entitled” red flag. Usually companies plan for 5 percent... 10 percent... or maybe 15 percent max over an initial offer.
- Get creative with compensation. We went back to hourly rate, and said the following: Looking at positions with a similar level of responsibility, skills, and scope, I’ve found that an average range works out to between $16 and $20/hr. Because I’ll be coming into this position not only with the requisite customer service and time management skills, but also my added design skills, I was hoping for something in the middle to upper end of that range. Is there any flexibility in that number?
The company responded by increasing the offer from $17/hour to $18/hour and agreeing to her deferred start date.
Some might say that this was a lot of effort for a $1 increase … to simply go from an entry-level salary of about $34,000 to $36,000. However, that would be missing the big picture.
- The counter-offer was a single email that took less than an hour to write, yet netted her an extra $2,000 per year. Not a bad tradeoff.
- Since every future raise will build off her previous salary, even a small increase now will lead to greater percentage gains moving forward.
- Her manager now sees that Susan is a savvy employee that knows her worth and can stand up for herself, reinforcing the fact that she made the right decision to hire her
- It’s all about the big picture. When starting your career, what’s most important is getting that first job under your belt, working somewhere that you’re excited about, learning a much as possible, and having a great manager that can mentor you.
- Getting over your fears and experiencing a successful negotiation—no matter how minor—at your first job at age 21 is a huge win, since this is a skill that can be used over and over again to gain tens of thousands of dollars for the next 40 years of her career.
An unforeseen twist:
When I reached out to Susan for a final quote for this article, she had just started her new job. She responded with four words I wasn’t prepared for: "I got a raise!”
When she showed up for her first day, she learned that the person who hired her (her main point of contact) had been poached away by another company. When they appointed a new supervisor, they changed the schedule Susan had talked about. Instead of commuting three days per week and one day per weekend, it turned out she would be commuting three to five days per week, and would be working later at night.
Susan said, “When I asked for a salary increase in the initial negotiation, a reason I was given for not increasing it further was that I would be saving money on my commute. As soon as I had the chance, I raised concerns with my new supervisor that the schedule was very different than promised. No one else at the company was aware of the specifics of my initial negotiation and were surprised to hear that I was given reduced commuting time as a rationale for less money.”
“My new supervisor didn't feel that was sound logic and spoke to the CEO on my behalf. Before I had even been there for a week, my hourly compensation rate was increased to $19! This is going to make a huge impact in being able to repay my student loans sooner, especially since I've been working so much overtime already. I really don't think this would have happened without the groundwork of the initial negotiation.”
Start: $34,000 ($17/hour)
After: $38,000 ($19/hour)
Case 3: Stan
How do you negotiate when it’s your dream job?
Current pay: $55,000 with great benefits
Background: Stan was working a good government job with great benefits, but through networking and hard work, he landed an interview at his dream company. Not only was this an internationally recognized organization, but this particular office was ranked among the top in the world. Note that this was not an open, posted position, but rather was something the company was thinking of creating just for him. The problem? It’s hard to negotiate when it would unbearably difficult to walk away from an offer.
When asked during an initial phone call with the company for his salary expectations for this sales/biz dev. job, he stated a range of mid-to-upper $40s for his base.
While the upside is that he knew what he was looking for and was honest and upfront, the downside is that by going first, and not knowing how they structured their sales positions, he might have been too high or too low in his request.
- Recognize that salary is just one part of compensation. The next time salary was brought up, I instructed him to focus on the big picture, looking not only at base, but bonuses, commissions, benefits, vacation, and so on.
- Update your numbers with more information. Stan was worried that he would be held to the previous $40,000 range he gave at the onset of the process. We decided that if that number were to come back and haunt him, he should note that he is now more educated about the position, and in turn, can provide an updated salary range.
His next meeting went well, but Stan told me three things that I see in almost every interview:
- He beat himself up over a few stumbles. My number one piece of advice in a job search is: Don’t get too high when things look good, and don’t get too low if you make a few mistakes.
- He said he was going to have more meetings with more people. Again, very common, and the interview process keeps getting longer.
- Lastly, he was a bit stressed as he wasn’t exactly sure when the next meeting would be, so I told him the simple sentence you need to say at the end of your interview to make your job search less stressful: “What should I do if I don’t hear back from you?”
The next week he had his follow-up presentation and he nailed it … but two days later, the company called to say they decided not to offer him the job. Stan was a bit devastated. On a positive note, he knew that he didn’t necessarily do something wrong or lose the job to someone else. In the end the company decided not to create the new position because it was in a territory that wasn’t getting enough business
- Life isn’t always fair, and in a job search there will always be a large element that is completely out of your control. Things can change at any moment. The takeaway is that he has made great contacts there, and perhaps there will be a point down the road when things change and they decide to add this position, and he will be the first one they think of.
- Stan told me, “In summary, I learned a great deal about myself, and that the ‘hidden job market’ may actually exist. It just didn't play out for me this time. I've also learned not to show my (salary) hand too soon. It's a tightrope to walk, but saying too much too soon may leave money on the table.”
Start: $55,000 with great benefits
After: $55,000 with great benefits (stayed at same position)
Case 4: Neil
Timing a salary increase during a company shakeup and relocation
Current pay: $55,000
Background: Neil is working for an exciting and growing company, but they’re in the midst of a bit of a shakeup. While most of the company is moving and consolidating to a new location, Neil’s marketing group will be relocated to New York City from another major east coast city.
He’s been offered a pretty generous package of a 12 percent increase to $62,000, an extra month's rent to aid with the move, 5,000 shares, and relocation assistance up to $10,000.
However, based on some cost of living and apartment comparison research taking into account the move to Manhattan, he’s looking to ask for a 30 to 35 percent increase in salary and 10,000 in total shares.
Is this a smart move, or is he pushing his luck?
- Find out your true worth. It’s not about how much of a raise you’re getting from your current rate, but taking the time to check out your current worth on the market. Maybe the research will say he’s doing ok, but it also might be a time for a major adjustment based on his experience. The only way to know that is to hit the books (or the web) and do significant studying to see where he fits in. An initial look showed that workers with his title were in the $75,000 to $85,000 range.
- Solicit hard numbers around relocation. Is $10,000 enough for someone to move from a major city on the east coast to New York? For a single man or woman with a studio apartment, it might be more than enough. For a family of four that owns a three-bedroom house, it might not be. Fortunately, nearly every moving company offers a free estimate on what a move will cost. Don’t just rely on your company’s numbers, to be safe, get three estimates on your own to know what the ballpark figure is.
- Get an accurate estimate on housing costs when relocating. Moving to an expensive city like New York or San Francisco is tricky. On one hand, a company is going to pay you based on how you perform at work—you should never use housing costs as your only crutch when asking for a raise. On the other hand, cost of living is a real factor that can affect your life dramatically. If your rent or your commute time triples (I’ve seen it happen), it can have a significant impact on your productivity at work.
Neil needs to be able to talk knowledgably about his housing goals. While companies should not expect to fund a lifestyle that includes a giant two-bedroom overlooking Central Park, it also shouldn’t expect employees to share a two-bedroom with three new roommates on a 5th floor walk-up just to survive. If you can show you’ve done your homework for what a reasonable cost of living adjustment will be (don’t forget NYC’s massive taxes and fun items like $5,000 “broker fees” on apartments), you might earn some sympathy.
Approach the negotiation with lots of data. Come from a place of honesty in trying to make the numbers work, and look to collaborate to find a solution that both sides can agree on. In Neil’s case, he currently had a $1,000 apartment and a 15-minute commute, and his new situation might call for a $2,500 apartment and a 60-minute commute.
- Neil met with the President of the company, the relocation team, and then… life got in the way. More than a month passed since his negotiation started, and when I finally got back in touch with Neil, he said had been incredibly swamped with projects and they hadn’t had time to revisit the conversation. He predicts that he won’t be able to sit down for his next conversation for another few weeks.
- You know when you watch an HGTV show like Flip or Flop or Million Dollar Listing on Bravo and you get all the way to the end for the big reveal to see what happened and they say, “The property has several offers but has not gone to contract?” Well, unfortunately we have a cliffhanger here as well. But we wanted to share the strategy with you and emphasize once again, unlike a reality show that can often be wrapped up in 30 minutes, sometimes negotiating a significant raise or promotion can take months. Patience is key.
On the table: $62,000, one month’s rent, $10,000 for relocation, and 5,000 shares
Final compensation: TBD
Case 5: Thomas
How do you prepare for a performance review so that you show your accomplishments and receive an increase?
Current pay: $82,000
Background: Thomas is an accomplished designer working for a great company. The good news is, they value employee feedback and are deliberate about their performance reviews. The company had a great meeting to talk about goals and performance earlier in the year soon after he was hired, and now it’s time for his next review.
Salary is not the most important career factor for Tom. He previously owned his own company, and in pursuing his next venture, fielded offers as high as $110,000 and as low as $70,000 at a non-profit. In the end he chose this company because he liked the team, enjoyed the work/life balance, and got to work with clients nationwide.
That’s not to say he doesn’t know his worth. Recruiters have come calling, reaching out with offers up to $150,000. He’s also a little frustrated that the company is utilizing his design skills, but not the strategy expertise that he developed while running his own shop. He’s helped land four new clients this year. So now he’s looking for an increase to put him in the $100,000 range.
Thomas is not 23 and going for his first raise. He’s an accomplished former business owner, so it’s natural that he’s experiencing some growing pains with politics and a frustrating chain of command within a new corporate structure, when previously he’s been the primary decision-maker. A wise company should view him as a major asset and utilize his skills to the fullest. Ideally, this is a mature business conversation where everyone gains clarity and changes are made.
- Start the conversation by being thankful and recognizing the opportunities you’ve had. Thank them for taking the time to do reviews so thoroughly, seeing the value they bring, and that they serve as a great time for both sides to step back, review the landscape, and look for areas to improve.
- Share your personal goals moving forward, highlighting all the great things you’ve done so far. In Thomas’ case he:
- showed before and after examples of all his great designs.
- talked about bringing in four new clients and the numbers behind them.
- emphasized the ways he’s made the company money, saved the company money, and the unique skills he brings.
- Next, explore the company’s goals. Ask them what they see for you in terms of next steps. What would a future title be? Explore areas of frustration that they are having in the process, and offer solutions on how to fix them.
- “My review went well—they gave me a $10,000 raise! Pretty pumped at that. They also are having me write a description of the role I'd like to carve out and move towards. It won’t take effect immediately, but will show where I'd like to go, and how I can continue using all of my skills.”
- Many times the best way to judge the success of a review isn’t just the money, but a company’s attitude along with the money. Yes, Thomas was looking to get to the $100,000 mark, but fell a little short. However, there is so much more at play. We had already established that salary wasn’t his motivating factor here. Still, by giving him a substantial 12 percent increase of $10,000, the company showed they valued him as a top performer. But even more importantly, they actively listened to his concerns, and are giving him the creative freedom to carve out a job description that will allow him to be more fulfilled in his job. That’s something that’s hard to put a price on.
After: $92,000 plus self-determined future role in the company
Final case study takeaways
I think there are five takeaways to learn here and adopt for your next negotiation:
- Ignore the clichés. Whether it’s a government job, your first offer, or a decent compensation package you’re not sure you should challenge, there are no hard and fast rules of what to do. Go at it with your best instincts and expect to succeed.
- Nothing is a sure thing. As you saw with Stan (the dream job chaser), even when you’re a great candidate and do everything right, there is still so much out of your control. All you can do is roll with the punches and adjust to new information as you get it.
- Everything takes time. While the weeks of paperwork for the agency that Derek had to wade through might not shock you, in every case there seemed to be one more meeting, one more week, and a few delays baked in. You need to expect this.
- Always look at the big picture. Perhaps you expected five case studies where each person received a $20,000 increase, but this is real life. You’re rarely going to get every item you want, so you need to stay objective and take a step back. Change is constant, so whether you’re reporting to a new boss, moving to a new city, or starting something completely new, learn to adapt and be positive.
- You’re not in this alone. While you might be stressed during the process, know that other professionals are going through the same thing as you are. Confide in a coach, a friend, or family members for support.
[Read more about salary negotiation here.]
More about Jim Hopkinson
Jim Hopkinson helps ambitious professionals negotiate their salary and get paid what they’re worth. He offers free resources, online salary negotiation courses, and one-on-one consulting through his website SalaryTutor.com.