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Great advice from The Lawyer Whisperer

July 29, 2016

My current compensation is below market. How do I overcome this issue when negotiating compensation for my next job?

Julie Q. Brush

Congratulations. You’ve applied for the job and gone through a rigorous interview process. And they like you. A lot. The hard part is over right? Nope. Now, it’s time to talk turkey regarding compensation. Just the thought of it makes many lawyers sweat. And understandably so. It’s stressful enough when there is compensation alignment on both sides. But what happens if a candidate’s compensation is below market? How can a candidate effectively address this issue in the negotiation process?
Below market “comp” compromises a candidate’s leverage in every negotiation. By being below the bar, an employer knows that even at the lowest end of their range, the candidate will receive a compensation increase. And how can you argue with that? So guess what happens: The first offer comes in towards the lowest end of the range…or lower. It happens every time. But having below market compensation doesn’t necessarily mean that you’ll have to settle for the low end of the range as a final outcome. You may not reach equilibrium, but it is possible to bridge the gap and receive a more market-aligned salary.

So how do you do that? Below is that path come Game Time:

Pre-Offer Compensation Discussion:
You’ll likely be asked for your current compensation and expectations before an offer is extended. When this inquiry occurs and you have not been provided the compensation range for the role, it’s ok to hold off on an answer until you have that information. When asked, a sample reply could be: “Sure, I’d be happy to. But I haven’t been able to assess my expectations yet-as I don’t know how the company is valuing the role in terms of a compensation range. Could you provide me with this information?” Once obtained, you can then have a more meaningful discussion regarding salary.

In this discussion, don’t hide the ball, don’t be tricky or vague. Be straightforward about your current salary and commit to a hard number range regarding your expectations. This provides clear guidance for the employer. I strongly advise against providing any number that exceeds the employer’s range midpoint. You’ll lose credibility and will compromise your ability to get what you need. Below are two sample messages:

Sample #1: “My current base compensation is $165k with a 10% bonus. My base compensation expectation for this role given my background and level of expertise is between $180k-185k. I understand that this may seem like a bit of an increase compared to what I’m currently earning, but my current compensation is quite a bit below market compared to what other companies are paying for attorneys with my experience. I was willing to make the cash trade-off in my current company because a significant stock grant bridged the gap. I also received the opportunity to expand my skill set which allows me to contribute greater value to your organization. So I believe $180k – $185k would be a fair reflection of my value to the company.”

Sample #2: “My current total compensation is $185k. This consists of a base compensation of $165k and a bonus of $20k. In my next role, I’m seeking to increase my base compensation to more accurately reflect the market rate for someone with my credentials and experience. For this position, I would like to earn between $180k-$185k as a base salary.” Silence…

Post Offer Discussion:
If the offer you receive is disappointing, discuss it with the employer and ask for what you want. Be respectful and express your appreciation for receiving the offer. In addition, reiterate your excitement about the opportunity, but explain that you would ideally prefer a base compensation in the range of [range provided previously]. Ask if the employer would be willing to move within this range to create a win-win. Then see what happens.

Negotiating an offer is never easy. And when your current compensation is below market, the wind gets a bit stiffer. But it is possible to make progress and bridge the gap. And by being clear and making your case…that wind you’re experiencing has a better shot at becoming a breeze.

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