Behind the Scenes Salary Surprises – October 2008
After a thorough and sometimes exhausting hiring process,
how often does compensation become a stumbling block when
you reach the offer stage? Comments like “Why is she asking
for more money?” or “Why can’t they come up a few thousand
dollars?” are more common than you might think. Compensation
is the number one reason employers loose candidates at the offer
stage. Taking all the precautions does not mean it will not happen
again but there are ways of minimizing the risk.
Where do things fall apart? Look at the basic motivations of the employers
and candidates. You want to hire the best talent for the salary you offer while at the same time complying with corporate salary limitations. Candidates not only want to maximize their income but also see changing companies as an opportunity to step ahead. If you don’t find that sweet spot where employer and candidate motivations overlap, it is a recipe for disaster.
At the point where the candidate receives an offer the “balance of power” moves to the candidate for the first time during the hiring process. How smoothly things go at this emotionally charged time relies entirely on how well you have understood the candidate’s motives and expectations. Even so, you should not be surprised if the candidate tries to negotiate the package.
How do you manage salary negotiation? Do you see candidate negotiate as “healthy” or “unhealthy”. Often it is only perspective that make the distinction. After meeting your potential new employee several times, establishing where they stand in your company hierarchy and offering what you feel is a fair and equitable salary, the natural response to a candidate’s request for more money ranges from mildly irritating to considerable indignation (how dare the candidate ask for more!).
This does not mean you intentionally low-ball the first offer, or that you are forced to accept a request for a higher salary. Again, communication throughout the search process is essential to minimize surprises. Lets say you are interested in hiring a candidate who is skilled at negotiating contracts and that person is already close to the top end of your range. Regardless of other compensating factors you could be up for a battle if the candidate’s expectation are not managed during the hiring process.
Minimizing the risk starts at the beginning with the selection process and carries through till after the offer is tabled. Be prepared for potential salary negotiation. Understand the candidate’s motives through good prescreening, interviewing and interview feedback. Reduce the surprises and limit fall offs due to salary issues.
David Street, Senior Consultant