While this FAQ is about the steps to take to negotiate a raise, it’s important to note that a job is not solely about compensation. It’s about what you do every day, the impact you’re making, what you’re learning, and most importantly how you like the team and your manager. Optimizing for compensation by moving jobs or teams without taking this into account is a mistake.
With that said, compensation is an integral part of one’s total employment experience and so it’s important to get it right both at the start of one’s employment and throughout the entirety of the experience.
To ensure you’re negotiating the right offer or raise, it’s important to take into account 4 key factors:
Personal comp history
Alignment with internal peer class
What both sides want
While it’s common during the offer or raise negotiation process for any one of these to be the driver of events, it’s good to always look at things with a balanced view so that both you and your employer can ensure you’re landing on the most fair and balanced compensation package possible.
Step 1: Review market data
Leverage data from Paysa.com to understand what your personalized market salary is, as well as what you might make at similar titles at other companies that are in your space.
Make sure to confirm location for cost of living adjustments!
Review the contents of your research and data to ensure you fully understand the data, and are comfortable with it.
Pay specific note to your value in adjacent market segments so you can be most prepared for an apples to apples conversation: startups vs. pre-IPO vs. public as these companies make different trade-offs on base salary vs. equity etc.
Step 2: Figure out what you want
What would compel you to stay with your current employer and for how long?
Raise in base?
Cash retention bonus?
Mix of these as long as it connects back to raise in total annual comp?
Pick your target number or scenario
Pick your walk-away number or scenario
These two scenarios create your negotiating range
Step 3: Schedule a meeting with your manager
This should be a 30 minute scheduled meeting
Tell your manager that you want to talk about compensation
It’s preferable that this takes place in setting where it’s already natural for compensation to be topic of discussion: a regular 1:1 or an upcoming performance review
Step 4: Prepare for your meeting with your manager
create a written list of your major accomplishments since the last time your compensation was reviewed
create a written list of the major projects you’re planning to work on over the next 2-4 months
practice having ‘the conversation’ a few times with a friend until you’re comfortable with the tone and message
Step 5: The conversation
tell your manager that you would like to discuss your compensation package
state 2-3 of the biggest accomplishments that you’ve achieved since the last time compensation was discussed
reconfirm your commitment to the company and to the projects you’ll be working on over the next 2-4 months
tell your manager that you’ve heard from friends what others are paying in the market for the same level and skill set
tell your manager that you stumbled upon a cool website called Paysa that takes a data science approach towards analyzing people’s backgrounds and helps them better understand their market compensation and even at specific companies
show your manager the data from your research, and stop talking
try practicing with any one of these scripts:
Hi Boss, I‘d like to talk to you about compensation. As you know I’ve had a great experience working here, I love the team and company and and I’m definitely motivated to continue. I’ve been a key contributor to XYZ initiatives and I’m slated to contribute to ABC initiatives and am really looking forward to that. I’m not one to pay too much attention to this but I’ve been hearing from friends and past colleagues what other startups and companies are paying people like me and it’s definitely opened up my curiosity about how inline my compensation is with the market for my background and contribution. I also recently stumbled upon this site called Paysa that uses a data science approach to analyze a person’s background and lets them know what they’re worth in the market. I printed out their custom raise report and I’d love it if you could take a look.
Hi Boss I’d like to talk to you about raising my compensation to be more inline with market. You know that I love working here and am highly motivated to continue but I feel like my compensation is lower than market for my experience and contributions and I’d like to find out what you could do to help adjust. I also recently stumbled upon this site called Paysa that uses a data science approach to analyze a person’s background and lets them know what they’re worth in the market. I printed out their custom raise report and it looks like I’m about 30k off in total comp. Is this something you could help adjust for me?
Step 6: The negotiation
when your manager asks you what you’re looking for, tell them the high end of your target range
if your manager needs to talk to more people or think about it, set a specific time within the next week to follow up
talk less and listen more
when asked why you want a raise, always come back to wanting fair and equitable pay for your background and contribution to the company
continue to restate your goal of wanting to continue working for the company
Below are the common pushbacks that you might receive from your manager along with suggested responses:
we only give raises at year end
I understand but year-end is a long time away and I fear that waiting will only create more misalignment. Can we make an exception?
you just got a raise
I understand, I just don’t feel I was as informed as I should have been at that last raise conversation. I now feel more confident of my market value and while I appreciate the last raise, the goal this time around would be to ensure we’re both aligned to market for the foreseeable future moving forward.
we have strict salary bands and this puts you outside of the band
I understand but I’ve been hearing a lot of feedback from my friends that company salary bands are not always able to keep up with the speed and accuracy of what’s happening in the market. This Paysa report bases its recommendation on real-time compensation data it receives from people just like me. Look, it even tells me what I’m worth at other startups and companies and even what I’m worth here based on others who work here. If we wanted to explore some compensation options outside the current pay band, what would be the best way to do that?