Money & Life contributors draw on their diverse range of experience to present you with insights and guidance that will help you manage your financial wellbeing, achieve your lifestyle goals and plan for your financial future.
Do your homework for your next pay rise conversation with these ten tips to help you prepare your case and boost your chances of getting the right result.
Here are some tips to get you ready for a positive conversation about your pay – and perhaps a successful one:
1. Know your worth
Be honest with yourself about what’s motivating you to ask for more pay. Do you have a good reason to expect a pay rise based on your performance, a change in your role, or how well others in your industry are paid? If you don’t know what the going rate is for the role you’re in, finding out could help you build a more convincing case.
2. Get the timing right
The end of the financial year, or anniversary of when you began in your role can both be good times to ask for a pay increase, particularly if you can also show how well you’ve been performing over the last 12 months. Timing your conversation to coincide with an upturn in the fortunes of your organisation can also help you make a stronger case. Read company reports and press coverage to stay up-to-date on how the business is tracking towards their goals.
3. Make a positive connection
Whether it’s your boss or someone in HR that you’ll be discussing this with, take time to establish a positive connection with them. Taking steps to present yourself as honest, trustworthy and approachable will prepare the way for a positive discussion and outcome, whether you’re successful or not.
4. Choose your moment
Ambushing your boss with the subject of your salary isn’t a good way to go about this. Book in a time to have your discussion, making sure you let them know what it’s going to be about. Try and choose a meeting time when you’ll have their full and undivided attention – first thing on a Monday and last thing on Friday should definitely be avoided.
5. Prepare your case
Gather knowledge on your employer’s process for making pay awards and decisions. Knowing how it works and what influences the outcome can help you present the most relevant information as part of your case. If your conversation is going to be with an HR team member, talk to your boss to see if they can advocate on your behalf. This may mean going through two challenging conversation instead of one, but it’s going to be worthwhile if they can help you get the right result.
6. Be clear, confident and realistic
A confident approach is important for a successful negotiation, so don’t be afraid to be direct and clear about your expectations and reasons for asking. Pointing to clear and measurable examples of how you add value in your role is going to strengthen your case, especially if your colleagues can back you up. So don’t be afraid to blow your own trumpet providing you can show evidence of your outstanding results.
On the other hand, don’t get too carried away with the confidence. Ask for double your salary and you’re unlikely to be taken seriously, no matter how much of a star performer you are.
7. Show you’re listening
Once you’ve had your say, take time to listen carefully to the response, even if it’s not the one you want to hear! If you’re turned down or offered less than you were hoping for, ask questions to understand the constraints or circumstances behind the decision. Try to demonstrate understanding by framing your questions with the other person’s perspective in mind.
8. Take your time
Silence can be a powerful tool in negotiation. If you’re initial request isn’t met in full, it’s worth taking the time you need to consider what you’ve been offered, there and then. And ask for more time to think about it to show them you take this negotiation seriously – a few more hours, or days if you need them. Be clear and honest about your timeframe to show you respect any offer that’s been made.
9. Stay calm and reasonable
If your request is unsuccessful, giving an ultimatum or venting your frustration can damage your relationship with decision maker. It’s just not worth risking your reputation, with this company or with future employers, by letting your feelings get the better of you. Stay professional and keep any response neutral, rather than delivering an ultimatum or being negative.
10. Leave or stay?
Whether you decide to call your employer’s bluff by handing in your notice is up to you. But there’s certainly no guarantee that your resignation will lead to an offer of better pay to make you stay. On the other hand, you may be in a stronger position to negotiate with a new employer if you’re an exceptional candidate.
If you do decide to stay put, take on board anything you learned in the process and apply it to how you work from now on. Getting the pay you deserve could mean addressing some of your weaknesses at work, or just playing to your strengths a little more than you already do.
Thinking about asking for a pay rise? Find out what’s been happening with pay rises across Australia and get tips to help you save the extra if you’re successful in your pay negotiations. You may want to consider seeing a CERTIFIED FINANCIAL PLANNER® professional to discuss your projected income and investment options. Find a local CFP professional using the Financial Planning Association’s (FPA) Match My Planner.