Salary negotiation tips for employers

For employers and candidates alike, salary negotiations can be one of the more challenging parts of the hiring process. In the current market, job openings outnumber the available talent, making it an “employee’s market”. For job seekers, this is good news, with more opportunities across the board. On the flip side, employers face more competition for candidates and more pressure than ever during the salary negotiation phase.

In any market, successful employers come to the table prepared and ready to work with candidates to find the best possible result for both parties. Today, candidates know they are in demand and are in a better position to ask for higher pay. They are less likely to compromise, knowing they can move on to the next offer pretty quickly.

To get you on the track for success, we’ve compiled a few tactics to help employers better negotiate salary with a prospect.

Successful salary negotiation tactics

Use these tactics to aid in your hiring process and lead to successful salary and employment negotiations:

1. Market awareness is imperative. The truth is, strong candidates are receiving multiple interviews and job offers. It is up to you as an employer to make your company is the most enticing of all.

Make an honest effort to provide a positive interviewing experience. Ensure all interviewers are engaging, as well as open and honest about the company and position. Now is not the time to put on airs or attitude. When a candidate has a negative experience with a potential employer, 72% of them will tell others about it, creating a ripple effect in the market.

On the flip side, candidates who have good experience are more likely to come into the negotiation process excited and more open-minded. They want to work for you and don’t feel like they are compromising or missing out on another opportunity.

Want more information on the candidate experience? Check out our recent article on how to create the best possible interview process. 


2. Make sure your policies are up-to-date. If policies bring up issues for candidates, it’s better to know upfront versus down the line when you are getting ready to close the deal. In particular, candidates are interested in potential employers’ hybrid workplace policy and their COVID-19 vaccination policies. The pandemic has changed how employees prefer to work, and according to a recent survey by Slack, 72% of workers prefer a hybrid remote-office model. This doesn’t mean that an employer has to offer hybrid or remote-only work options. However, if you do want your employees to be in the office, be ready to explain why, as well as how you are planning on keeping workers safe. The same goes for your vaccination policy: know if you are going to require the vaccine and be ready to explain the outcome for not following the rules.


3. Know your compensation philosophy.Every company takes a little bit different approach to salary negotiations. Whether you plan on actually negotiating with a candidate or coming in with your highest (and only) offer is completely up to you. You will be successful if you know your company’s compensation philosophy and stick to it.

If you are planning on negotiating with a candidate, know your high and low acceptable salary and how other benefits will impact your overall compensation package. Your low range must still be within industry standards for you to remain competitive (for more on those standards, check out the U.S. Bureau of Labor and Statistics). Take time to research the market and have the data ready to back up your salary range and offer.

In an employee’s market candidates know they have other options, and in some cases, they are getting more than one offer at a time. This often leads to higher expectations from candidates on compensation packages. Be ready for candidates to ask for the higher end of your range, and make sure you know where to draw the line. Overextending yourself on a salary negotiation can have negative impacts on your bottom line in the long run.


4. Be patient and don’t take negotiations personally. Negotiating with a candidate takes time, so don’t expect an immediate answer. Give time for your prospect to review and think about your offer, but do make sure to give a reasonable deadline for response. Above all, don’t take negotiations personally, it is business after all.


When in doubt, hire professional recruitment help

If negotiations are something you are not comfortable conducting, especially in this employee market, then it’s time to bring in the professionals. An executive recruiter, such as PS Partners, has the background and experience to successfully negotiate salaries, regardless of position or industry. In addition, prospective candidates can often feel more comfortable negotiating with a third party than directly with their potential new employer, making the process go smoother overall.

If you are looking for help with recruitment and salary negotiations, PS Partners is here to help! Reach out to us today for a consultation and learn more about our services.