With many workers still struggling in the tough, post-recessionary economic conditions, many candidates will use the new job offer scenario as an opportunity to boost their salary. And with many candidates perhaps feeling dissatisfied with the low pay climate, some are taking the more aggressive and ethically dubious option of lying about their former salary to secure a higher job offer for a new role. In fact, a CareerBuilder study has found that the third most popular lie that candidates tell is about their former salary.
But, clearly candidates should not lie about their salary; it’s immoral and a little foolish as employers are on to you, and they will find out because it’s very easy to check. It’s also unnecessary as you have an effective alternative strategy at your disposal to boost your former starting salary figure legitimately. And this is to talk about your earnings in terms of total compensation rather than just salary. Total compensation takes into account all the monetary and non-monetary components of your package, which you may be benefiting from financially, and which are often ignored or overlooked in your new salary negotiation. This means that many candidates underplay their salaries and start from a lower negotiation point than they need to.
So, how can candidates fairly inflate their salary in order to raise their starting point for salary negotiations? The simplest way is to ask your former employer for a Total Compensation Statement (only the more enlightened employers offer this), which will detail out the monetary value of both your financial and non-financial benefits. You can use this higher total compensation figure as part of your salary negotiation.
But, not withstanding that, you’ll have to roll up your sleeves and do it the old-fashioned way. Start by looking at any major benefits that you may have, such as retirement savings, health insurance, permanent health insurance, etc., and establish what the monthly premiums or contributions that the employer has been making on your behalf across the year. You can quite legitimately add these figures to your base salary to fairly inflate your salary.
Now that you have covered all the obvious areas, you can look at the other perks that you may receive, such as: subsidized gym costs, subsidized canteen food, group purchasing schemes, on-site crèche, child-care support subsidies, training or education allowances, etc. Total up the monetary value of these perks by looking at how much you save a year from having these benefits. Once again, you can quite legitimately add these figures to your base salary to fairly inflate your salary.
Then look at vacation days, and any holiday period shut-down days you may have, to establish the monetary value of this perk, and this will give you more figures to add to your total compensation figure. It’s probably substantially bigger than just your base salary, right?
Also, consider the value of any specific flexible working regime you worked under which had an indirect monetary benefit in terms of reduced child-care costs and potentially travel costs, and add these figures to your total compensation package.
And finally, look at any additional commuting costs which arise as a result of you working at the new employer’s premises as this can also be a negotiation tool as it is devaluing your new package versus your old package.
It’s very likely that your employer will offer some of the old benefits that you previously had and try to negotiate you down on this basis. But, at least you’ll be starting your negotiation from a higher starting position, meaning they will have to work harder to knock you down, as opposed to you working harder to pull yourself up.