When negotiating a pay rise, it is critical you don’t approach your employer unprepared. A lack of knowledge and research will lower your confidence and will likely result in a negative outcome. Knowing the market value of your role, quantifying your contribution to the company, and having a clear idea of what you want, is essential for a successful negotiation.
Understanding your value
Before beginning salary negotiations, make sure you understand how your current salary measures up against the average in your sector.
How to ask for a pay rise
Pay can be a sensitive topic. It's not something you should be discussing with your line manager in the middle of a crowded office. Likewise, pay is extremely important. Let us be honest, how many of us would continue to do our jobs if we weren't seeing any financial benefit? Don't just bring up your salary as an afterthought at the end of an hour-long 121; ensure your request for a raise gets the attention it deserves by arranging a separate meeting.
Ultimately, your personal preferences and relationship with your manager will dictate how best to organise your pay review meeting. You might prefer to give them the subject in advance. This can be particularly helpful if you want to seek their advice on how to prepare for the meeting. Or maybe you'd rather send a generic, agenda-free request and do all your talking on the day.
It is also important to consider the timing of your request. Has your company just lost a big client? Does your manager have an unusually high volume of important meetings at the moment? If so, they may not be in the best frame of mind. We're not suggesting you abandon your request entirely, but when it comes to negotiating a pay rise, you want the deck to be stacked in your favour. Wait until their schedule is comparatively empty – ideally at a time when there are no major business headaches to distract from your meeting.
Building a business case
To negotiate a pay rise from a strong position, you must clearly quantify the value you add to the company.
Make note of any recent training or qualifications you have completed, as well as your key achievements and the measurable ways they have benefited your employer. Have you played an important part in bringing in new business? Identified a new tool or process to drive efficiency? Been praised by clients or senior management for the quality of your work? All of these factors will play in your favour.
You should also take the time to highlight the key skills you possess that are in short supply, or otherwise entirely missing in your organisation. The more you can prove that you are indispensable to the business, the more likely you are to land that pay rise.
Most importantly, be prepared. The average person thinks nothing of spending hours getting ready for an interview, yet far fewer do the same when negotiating pay at their current employer. Practice running through the core message of your pay rise sales pitch. You should be able to present your business case in no more than a couple of minutes and prepare answers to likely follow-up questions, such as:
- What pay rise are you looking for?
- How did you arrive at that figure?
- What more could you do to earn it? (e.g. take on more responsibility; run a training programme for less-skilled colleagues; work toward a professional certification).
Finally, be aware that your manager is unlikely to give you an answer on the day. Any pay rise must be fully considered and costed. Propose a date for a follow-up meeting to discuss their decision and any next steps.
What are your chances of being given a raise?
However persuasive your business case, bear in mind that external factors are at play too. Your manager's hands may be tied by the company's financial position; the industry you work in may be on a downward curve; you may be at the end of a long queue of employees seeking pay rises. If market conditions are in your favour and your performance warrants a raise, you are more likely to be successful.
So what if you don't get a pay rise? Hopefully, your manager should be able to provide clear follow-up actions to help you work toward a future raise, ideally with an agreed deadline for your next review.
If that's not acceptable, it's worth noting that your chances of securing a higher salary are often better if you switch jobs. Indeed, a 2018 study from the Resolution Foundation found that people who moved to a new employer enjoyed nominal pay growth of 11%, compared to just 2.5% for those who stuck with the same company.