How to negotiate for more starting pay

For a sign-on bonus, a good starting place is to ask for 10 per cent to 15 per cent of your base salary. PHOTO: PEXELS

Most employers who need to fill roles quickly usually have problems finding suitable candidates. For workers savvy enough to recognise their leverage, it has never been a better time to negotiate a generous compensation offer.

As a career and money coach, I have seen clients successfully negotiate offers that include substantial salary increases and signing bonuses. The most costly mistake that workers can make these days is leaving the bargaining table without asking for more. Here are some strategies.

1. Make a realistic request for a sign-on bonus

Companies are often more willing to offer bonuses to job candidates than ratchet up their base salary because they have to cover the cost only once. The key when asking for a bonus is to make a realistic request.

I advise my clients to start with any amount of money they are leaving on the table at their current employer. That can include unvested equity grants, stock options and even tuition reimbursement funds that they would have to repay upon leaving.

Job seekers who are not necessarily leaving money behind can start by posing the simple question: "Is a sign-on bonus available?"

Let the employer name a number first. If pressed for specifics, a good starting place is to ask for 10 per cent to 15 per cent of your base salary.

2. Line up multiple interviews

Even if you have your eye on one employer, having competing offers from multiple employers gives you extra bargaining power. Plus, it demonstrates to prospective employers just how in demand you are.

For job seekers such as Ms Sabrina Hill, 47, a hospital data analyst, this strategy came in handy. She received an attractive offer from her top choice but asked for a week to decide as she was waiting on an offer from a competitor.

During that time, she asked for additional perks she had never considered in previous job negotiations, like "restricted" shares that will be vested after a certain period.

Ultimately, her top-choice company, the clinical software company AdaptX, offered her US$15,400 (S$21,000) worth of stock units and promised her she could be as flexible with her schedule as she needed to be.

3. Ask for additional equity

If a company offers equity (such as restricted stock units or stock options) as an incentive for new hires, you can always ask for more than the initial offer. Companies are much more likely to sweeten an equity offer than increase your base salary if they have already maxed out their budget for the base.

Also, if you are leaving equity on the table at your current employer, you stand a good chance of having your new firm cover the cost of any shares you are forfeiting. You just have to ask. They may request documentation of your vested and unvested equity grants before they cut you a cheque, so be ready to produce those.

4. Ask for paid time off upfront

After two years of grinding away in her healthcare analytics role in the middle of a pandemic, Ms Hill was thrilled to find a new job opportunity that paid competitively.

But she was still burned out and craved time off to recuperate before starting her new venture. Rather than ask for a later start date and use her savings to cover her expenses in the meantime, she asked her new company to allow her to start on the job but immediately take a paid vacation.

"I was able to quit my job early and take about three weeks to reset, and I was paid for that," she said. "I thought, 'Oh, wow'."

5. Read the fine print carefully

Perks such as sign-on bonuses and equity often come with strings attached.

With sign-on bonuses in particular, watch out for clauses that require you to stay employed with the company for a certain period or else having to repay the cash.

And restricted stock units are called "restricted" for a reason. They typically are doled out (or "vested") in batches over several years, and employees can cash them out only during certain periods throughout the year. If you are granted stock options, which give you the option to buy company shares at a discount, you cannot exercise them until you reach your vesting date.

Don't be shy about asking lots of questions about how these equity incentives work during your interviews. Just save them for your recruiter, who is more equipped to answer them accurately than a hiring manager. NYTIMES

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