4 tips for negotiating compensation in the workplace

There are some things in life that people avoid like the plague. Talking about money at work is one of them. Working in human resources, it’s part of our jobs everyday but it can still be awkward and uncomfortable. Money is a sensitive topic for many people and it can bring up emotions that aren’t typically expressed elsewhere at work. Additionally, you’ve likely been asked questions that are difficult to answer or that you just don’t know how to handle. However, even with the difficult nuances of compensation negotiation, it doesn’t have to turn into a situation you tell stories about for years to come. Take a look at these five tips for discussing compensation in the workplace:

Be prepared

If you’re concerned about being approached by employees with salary questions, you should be. It’s inevitable, so you should already be prepared when the questions arise. You may not know exactly what the questions will be, but you should at least have a plan for handling the situation. For instance, will you answer questions or will you need to relay the questions to someone else? If it’s a new hire, is there any room for negotiation? It helps to do some general research and know what employees may find when they do their compensation research. PayScale’s cloud compensation software is a great place to start as you can determine salary ranges for just about any type of job and have an employee report ready for those tough conversations about pay.


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Attitude is half the battle

When an employee asks to speak to you about salary, your automatic reaction might be something like fear or even defensiveness. If you approach the situation with an open mind and open ears, you’re putting yourself in the best position to be well received by your employee. Watch for body language and listen to the words they use to get a complete picture of what they’re really saying. Are they concerned about their own finances? Do they feel they’re being unfairly compensated? Knowing their motivations can help you provide the right information.

Think outside the box

Often when it comes to negotiating compensation, employees focus on salary only. This is especially true when negotiating compensation for new employees who may not be familiar with other aspects of your total compensation package. Part of your job is to help both new and existing employees understand their compensation package. Additionally, there are some times that you simply may not be able to meet an employee’s salary requirements, or where their request is too far outside of the market-based pay range for their job. This is where it may help to get creative with your total compensation and offer other perks to pick up where the salary leaves off.


Take a moment to gather info

It’s sometimes our natural reaction to flex our expertise and provide an answer right then and there when it’s asked. However, it’s not always in our best interest or our employees’ best interests to provide an answer just for the sake of providing an answer. When an employee comes to you with questions or wants to discuss compensation, it’s ok to say that you need to do some research, run an employee report (If you are a PayScale subscriber) speak with someone else or give their question some thought. This may help keep you more honest and accurate in your answers. When you do provide answers, a good rule of thumb is to be comfortable with everyone in the company knowing what you said. That employee may not tell 50 people, but they’ll probably tell at least one. Keep your answers honest and consistent between employees to keep drama and resentment at bay.

What tips would you pass along for negotiating compensation in the workplace? Let us know in the comments below.

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