When should you discuss your salary in a job interview?April 14, 2011: 10:33 AM ET
Revealing your current compensation too soon could undermine your chances for higher pay. Here's how to negotiate.
FORTUNE -- Dear Annie: I read your post about merit raises with interest, because I've been involved in some pay negotiations myself lately -- not as an employee, but as a job hunter.
In a couple of interviews, the hiring manager has asked what I'm making now very early in the conversation, which puts me in an awkward position. On the one hand, I don't want to seem uncooperative, but on the other hand, shouldn't we discuss exactly what the job entails and why I'm a good fit for it before we move on to the subject of money?
There's nothing wrong with my current salary (I'm interested in changing jobs for other reasons), but if I reveal it right off the bat, doesn't that put a cap on what employers might be willing to offer? How would you and your readers suggest I handle this? — Mum's the Word
Dear Mum: Good question. One factor that complicates matters these days is that many people have been out of work a long time, which means that some of your rivals for any job opening "are so happy just to get a job offer that they will accept a lower salary than they have to," says Bill Humbert, who runs D.C.-based recruiting firm Humbert Group. "So employers feel they can get away with lowball offers."
Even so, he says, "the truth is, there are ways to get the job and still get the compensation you want." Humbert has worked with more than 3,000 hiring managers at Comsat Labs, USF&G Insurance, GEICO, CSX Technology, and many other companies over the past 30 years.
He offers the following five tips for coming out on top in pay negotiations:
1. Don't send salary requirements with your resume.
"When a company asks you to include pay requirements with your resume, it can be used against you," Humbert says. Instead, he recommends simply saying that your expectations are "open" or "negotiable." "If your qualifications are on target, they'll call you."
2. Don't write down your pay history on an application.
In answer to a written question about salary history, "it's perfectly acceptable to fill in 'willing to discuss at appropriate time during the interview process' and leave those numbers blank," Humbert says. "Writing down specific figures pigeonholes you, and reduces your negotiation power."
3. Delay salary discussions until you have a clear understanding of the job.
When an interviewer wants to talk money early on in your first meeting, Humbert advises turning the tables and asking about the salary range for the position you're seeking. "You'd be surprised at how many interviewers will tell you," he says.
In fact, Humbert says, addressing the pay question too soon is impractical because "you really don't know what you'd require until you're sure you know what the job involves and what the potential for advancement would be over the next five years."
Having an idea of the benefits package the employer is offering is important, too. If, for instance, the salary range for the job is somewhat lower than you had hoped, other perks such as extra vacation time, a company car, or generous 401(k) matching may make up for the shortfall.
4. Emphasize what you'll be bringing to the table.
Once you've gleaned as many details as you can get about the job and the total compensation attached to it, Humbert says, it's time to steer the conversation back to what he calls your "impacts," meaning those aspects of the position that have a direct impact on the company's revenues and profits.
"Focus on the value you believe you can add," he advises. "Then, at the end of that discussion, simply say that you're very interested in the job, and that you'd seriously consider any offer they'd like to make."
5. Keep in mind that an offer is not always the last word.
Asking "Is there any flexibility in this offer?" may lead to a juicier deal, Humbert notes. If so, he says, it's more realistic to expect something like "an extra week of paid vacation or a signing bonus" than a big boost in base pay.
"Any negotiation is more art than science, and some companies may have policies that would require you to adjust the script a little," Humbert says. "The key thing to remember is that you don't have to state a salary range up front that would jeopardize your earning potential -- and, most of the time, you don't have to accept their first offer."
Talkback: If you've negotiated a pay package recently, what worked for you? If you're a hiring manager, how much (if any) wiggle room is there in your first offer? Leave a comment below.
Also on Fortune.com:
- How to make the case for a merit raise
- The most ridiculous job interview questions
- Return of the headhunters
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