If you’re negotiating your salary, don’t forget these benefits:
- Employers who won’t budge on your salary may be open to offering other perks.
- One-time signing bonuses, additional vacation and stock programs could be in play.
When it comes to negotiating the best compensation package from a prospective employer, the salary only tells part of the story.
That’s because even when companies are reluctant to drastically increase pay, they can offer other perks to win over the right candidates.
“Tech companies are sometimes venture-backed and not quite profitable yet, so some need to be more mindful with their cash than others, especially the early-stage startups,” said Carolyn Betts, founder of Betts Recruiting.
This is especially the case in a tightening job market. June’s unemployment rate crept slightly to 4 percent from 3.8 percent in May, according to the Bureau of Labor Statistics.
In fact, some candidates feel so confident in their ability to find work that they’re not showing up to their job interviews.
This means the ball is in new hires’ court, provided that their demands are reasonable.
Here are a few areas where employers can sweeten the employment offer:
If the HR manager is standing tough on your pay, but you’d really like to work for the company, consider asking for a one-time bonus.
This is an amount paid to the candidate for taking the position. Employers like it as they only have to cough up the additional sum once, instead of committing to a higher salary.
“Companies can’t go beyond certain salary levels for specific jobs because of internal equity issues,” said Jeff Zinser, principal at Right Recruiting.
“However, you can try to negotiate a signing bonus, a one-time gesture the company can make as a sign of commitment to you,” he said.
Carefully review the terms of your contract before accepting the offer. Employers often put strings on the money, requiring that you remain for a specified period of time in order to keep the bonus.
If you leave too soon, you may be on the hook to repay it.
Extra Time Off
Additional vacation days are another point of negotiation — and one that can be favorable to both parties.
“It’s the cheapest thing you can give to an employee,” said Zinser of Right Recruiting. “Most employees don’t use up all of their vacation, but they like the option of having it.”
Indeed, more than half of American employees had unused vacation days on the table in 2017, according to Project: Time Off.
Some companies have turned vacation into a flexible policy: They offer unlimited days off.
Tread carefully if this is the case for your employer.
“It’s not always as flexible as it might seem,” said Betts at Betts Recruiting. “Be able to say, ‘I plan to take off this amount of time. Is this in line with expectations?'”
Employees can also negotiate designated work-from-home days.
If you’re working for a company that’s publicly held or a start-up that has a credible path to initial public offering, ownership is on the table.
Employers can offer stock options, which are the right to purchase shares at a specified price — known as the strike price. Restricted stock units or RSUs, which are a promise to grant stock at a future date, are another possibility.
It can be difficult to compare these offers, said Emily Cervino, vice president of Fidelity Stock Plan Services
“Cash is cash,” she said. “But stock compensation isn’t easy to compare.
“It’s important to understand the vehicle that’s part of the discussion.”
Options have no intrinsic value until the share price exceeds the strike price. Meanwhile, restricted stock units are worth the share price on the day they vest.
Employers also place strings on these perks. Both options and RSUs are subject to vesting requirements; you need to work for the company for a specified period of time before you can tap the benefits.
“Understand your timing and your vesting schedules,” said Cervino at Fidelity. “It’s fair to assume most vesting happens over a three- or four-year cycle.”
Though anything can be up for negotiation, avoid these traps when pushing for additional perks:
- Absolute language: “This needs to come in the form of a dialogue and in the spirit of making it work,” said Betts at Betts Recruiting. “You’re really excited about this company.” You’ll need to be flexible in order to negotiate greater flexibility.
- Being tone-deaf: “Let’s say someone says I need an extra $10,000 because I have a longer commute, and the employer agrees to that,” said Zinser at Right Recruiting. “Let’s pretend you move closer, do I cut your salary then?” Be realistic about your request.
- Abusing your flex time: Be clear on how you plan to use “unlimited” vacation and work-from-home days.
“You’re allowed to ask for anything you want, and the company is allowed to do two things,” said Zinser. “They are allowed to say no, and they’re allowed to judge the things you’re asking for.”