Bring up the offers, discuss what you'd get from there and also go through the potential career you could build at those companies. For example: Consultancy X would pay me $k/mo and every 6months it will go up the ladder if I perform well.
With this kind of discussion you should be able to get a raise that brings your pay even above the competing offers.
Treat your current as one of the options you can make that day; make your employer fight for you every 6-12 months. And remember it's not personal, it's just business. Your employer would let you go and throw you under the bus if it made business sense.
tldr; don't get too emotionally attached to job; that's when they get you.
[Edit] To clarify the blackmail note: It's better to talk in the weekly 1:1 about salary expectations, changing markets or during people development focus, than to pull up a competing offer out of your hat while not talking about your dissatisfaction with pay during weekly 1:1s.
1. If the employee is only motivated by money, he will be gone rather sooner than later as there is always a higher offer around.
2. If you give in once to this, the employee will come back 6 months later with demanding the next pay rise.
3. You might have done something wrong in the past. An employee who can envision herself in the company in some years in a different role with personal development and fair pay rises (see 4.) does not leave.
4. You might also have no transparent pay rise process in place and clear guide lines why people have which salary. You might also have a wide band of salaries, which will bite you sooner or later.
5. Your salaries might also be too low and not working in the local market. This often happens when startups grow (or employee markets change) and salaries are not adjusted properly. Earlier employees - or employees before a VC round - often have too low salaries in this case. Fight for a budget rise to get every salary up in line again.
6. This might also happen if you agree to too low salaries when hiring. This often happens when you hire women, but also happens otherwise. You should always pay what the employee is worth, not what he is demanding (often too low). Don't feel happy if you hire below budget, this is a mistake. As a manager the easiest pay rise you can get for your team is during hiring.
There are exceptions: when salary is the ONLY problem, and usually that topic will have come up. So if the employee came to talk salary, was denied, then got some offers, came back with them, and asked again, then sure. But any company worth its salt will have done something before the other offers were ever in play.
If someone gets offers right off the bat and never talk salary first, then they'll be gone in 6 months unless you give them way above market rate.
Career advancement some times requires that the current manager say :
"Sofia, this is a great opportunity for you. While we could make you a counteroffer - you really should make the move to advance your career. Please let me know if you want a counteroffer anyhow."
Raising the pay of one employee out of band will usually lead to group behavior, meaning others do the same for the same reasons.
I was also mostly budget constrained in the past and could not raise budget to significantly (say 20%) pay raise several employees.
If the employee for whatever reasons earns say 10% below average of the other employees, I would get her a pay raise.
I figure the only way to really fix this 'the only way to get a raise is to leave for a year' method is to figure out how to include retention in engineering manager's perf evaluation.
What else would they be motivated by? It's not their hobby.
This doesn't mean they are also not into programming and coding challenges -- but those are constants that they can find in another employer too.
if they like the programming, it's not that they can't find a programming job elsewhere.
>2. If you give in once to this, the employee will come back 6 months later with demanding the next pay rise.
Sounds like the slippery slope fallacy. Even if they do, you can deal with it (and e.g. let them go) then.
The actual work (what is being done), the mission of the company (are you helping kids send pictures that disappear after 10 seconds or are you working on finding a cure to hearing loss?), the team, the location (do I have to spend 2h commuting?), the opportunities to learn, the opportunities to grow, etc.
We each value different things, but if money is your only consideration, you will be treated as a "disposable mercenary" because that's exactly what you are.
You will never be trusted, because your loyalty is directed at whoever shows more $$ to you.
Companies value more than just pure technical skills: loyalty, teamwork, communication skills, attitude, ethics, drive, independence, etc...
If you only play in that one dimension, the game becomes very rough for both sides. I've never seen that work well, except for very short term assignments.
The problem is that most companies treat you that way anyway. If you want me to not act as a "disposable mercenary", want me to stay longer and want me to give you loyalty, give me a contract to prove it. Unless you're willing to surrender your power to dispose of me at will, I'm going to treat you as if you'll use it at any time.
Work is a simple contract. I give time. I get money. Period.
The company will not hesitate to throw me under the bus if it can bring more money, and I do not see why I should be more considerate toward them ?
Honestly, I would rather work somewhere that is willing to get rid of useless and/or corrosive employees than somewhere that refuses to do so out of misguided loyalty.
Its a strange problem I guess. Systems are put in place to keep good employees around but are abused by bad ones. Then those systems are thrown out and everyone suffers.
I can say of a previous employer, all of the senior management took pay cuts before impacting the rest of us in a downturn. When my department did have to reduce by a person (I was the obvious choice to downsize), the entire (small) department, including my boss, took a furlough day instead. (Obviously, I started looking for new offers at this point, but I was never unemployed due to this.) Love that company. Great people.
I think a lot of people here may have experience with two types of terrible corporate environments: Faceless entity behemoths and cutthroat startups. There's a whole realm of small to medium traditional businesses out there where the owner knows everyone personally, and actually cares about the people who works for them.
Being employed with a company is a business transaction, where one party sells their time and skills in exchange for money.
Aren't employees disposable anyway? When the company runs low on cash, they are not going to hesitate to fire you to restore the financial health of itself.
Companies are motivated by money. It is in my interest to be motivated by money too. Companies are not loyal to employees. It is foolish to expect employees to be loyal to companies.
In my experience, there is a substantial difference in the quality of work of a person who cares about what they're doing and someone who doesn't care. Perhaps you've worked with a contractor who was willing to do a half-assed job, only fixing things if they were cornered. I certainly have.
Money can motivate that caring only so much.
Caring about money, caring about mission and loyalty and caring about work are all orthogonal to each other.
Of course you have the right to deny a rise and let the employee go, maybe it really doesn't fit in your budget and/or you can hire someone else for less, but don't talk like the employee is wrong for searching a opportunity to grow.
Companies exist to make money.
Money must be my only consideration, because that is usually the only thing of value that I get out of the employer-employee relationship.
All those work-related properties reduce to money and time. A shorter commute means less time spent in traffic and less money spent on fuel and maintenance, but often also means more money spent on housing. If my company wrote software for managing cancer trials instead of flight mission planning for military aviation, I might give them a break of 2-3% on my salary expectations. But if they offer $20000/year less than I currently earn (anecdotally, this has happened to me), well, sorry doe-eyed leukemia kids, but I have to make rent.
As for the team... Well, do you pay them enough to stay? People who entice others to join because they foster a great team environment should be paid more, not less, and your suggestion implies the opposite--that people who work on a good team should be willing to accept lower salaries.
If you have employees coming to you with competing offers every six months, that means one thing: your raises are not competitive with the market. We all know that job hunting is a stressful, unpleasant ordeal, and that is a cost that satisfied employees won't be willing to pay. If you see competitive offers from your employees, not only do you pay too little, but you pay so little that someone was willing to do the job-hunting dance in order to find better pay.
Anecdotally (n~=9) I have found your final statement to be inaccurate. Companies are interested purely in how much money they can make from your work. Your individual manager at a company may value more things, but those things might not translate to another manager, or might not help you if the money is ever a problem. For instance, you might get a $500 discretionary bonus for exemplary work one month, and be laid off with 3 days notice and no severance the next (this actually happened to me).
Companies value money. I value money. As long as we are both honest about this, it tends to work out. It doesn't get rough; it's just business as usual. It is only when people start lying about how their companies value things that problems occur. Based on the statistics, companies generally value loyalty at -3% of current salary per year, or worse. The article implies -7%, I think; the math wasn't entirely clear, and heavily assumptions-based.
A wage that will enable me to buy a house and my kids to go to college.
Loyalty is not a asset that a bank nor college accepts as payment.
Furthermore, a company is a paper entity, a legal fiction. A company is not a person. A company has no conscious, no dreams, no aspirations.
No human being should pledge loyalty to a piece of paper - which is not capable of returning that loyalty.
Working conditions (am I expected to be on call/respond to contact outside of hours), vacation time, flexibility in work from home and in leaving for appointments, how in traTed by my colleagues or other teams (does the sales department continuously overpromise and put me under fire?). The office space - I'd rather be in an open plan with my own "area" than in a cubicle farm with 500 other employees and no natural light.
Obviously pay is important but I'm not going to jump ship for a 5% raise if it comes with a worse work/life balance. Also, not everyone lives in San Francisco. There aren't _too_ many companies hiring c++ programmers in my area, so I'd go through them all in 5 years and probably annoy a lot of people along the way. Personally, for something that takes up so much of my time (40 hours a week) I'd rather be comfortable and get on with the people I share a working space with, than have them waiting for me to jump ship in 6 months
The Surprising Truth About What Motivates Us: https://www.youtube.com/watch?v=u6XAPnuFjJc
Based on studies done at MIT and other universities, higher pay and bonuses resulted in better performance ONLY if the task consisted of basic, mechanical skills. It worked for problems with a defined set of steps and a single answer. If the task involved cognitive skills, decision-making, creativity, or higher-order thinking, higher pay resulted in lower performance. As a supervisor, you should pay employees enough that they are not focused on meeting basic needs and feel that they are being paid fairly. If you don’t pay people enough, they won’t be motivated. Pink suggests that you should pay enough “to take the issue of money off the table.”
To motivate employees who work beyond basic tasks, give them these three factors to increase performance and satisfaction:
Autonomy — Our desire to be self directed. It increases engagement over compliance.
Mastery — The urge to get better skills.
Purpose — The desire to do something that has meaning and is important. Businesses that only focus on profits without valuing purpose will end up with poor customer service and unhappy employees.
I'm not really sure how this often quoted study relates to retention since that is outside the scope of the study.
If you want leverage in any negotiating situation, you need to be able to walk away from the negotiation if the final terms are undesirable. The party with the best "next-best option" is usually the one most willing to stand their ground on terms, or walk.
That means you need to be prepared to lose your job when you discuss changing its terms, which implies BOTH that you should have other offers AND that you should know your boss might fire you on the spot (or worse, talk you into rejecting the other offers and also quietly stop considering you for advancement in your current role).
The key, of course, is always to understand your BATNA: Are you actually willing to leave? You can play a significantly more daring game if you're prepared to lose, rather than accept status quo or a modest improvement.
I have never succeeded in getting any raise unless I had a concrete actionable BATNA, i.e. a competing offer.
Please note that I do encourage doing "research" - it doesn't have to go all the way to an offer, but what I mean is to build confidence that you can indeed get one at the given salary. This is your BATNA, but because you're not giving an ultimatum, you don't have to walk away to a new job immediately - you can just start looking.
#2 especially - what, they'll find a better and better job every six months? Not likely. If somebody can show you how they'd be paid better somewhere else, deal with it. Denial gets you nowhere.
#3 is exactly what the above remark addresses. If I can show my boss I'd be treated properly elsewhere, the boss sure better get on board and start doing those things.
If you feel you are treated better elsewhere, as a manager I'd help you transition to that elsewhere. If that is what you really want and think is best for you, I would make it as easy for you as possible. If you think money is most important to your current situation (house, wife, kids, debt, ...) and you're skill set is beyond my budget, than this is fine with me.
I'm more interested in people-relationships than job-relationships as I have met many of my employees in other companies and we're still friends - and most of them left for a different job with probably more money. Some of them told me years later they should not have left because I usually invest a lot into people development and money is only one parameter to job satisfaction.
I'm pretty sure you're an exception.
The BATNA for the employer is training a new person who isn't going to make every 6-12 months a fight.
Suggesting that it's fine for the employee to exercise their BATNA, but that it's not OK for the employer to exercise theirs seems a bit odd.
what, they'll find a better and better job every six months?
From the commenter above, make your employer fight for you every 6-12 months.. A lot of people hate stack ranking ("making your employee fight for their job every 6-12 months"), so why do people think that companies will want to be in the reverse position.
how they'd be paid better somewhere else, deal with it. Denial gets you nowhere.
The above poster said, "wished the employee all the best with his new job.", which is dealing with it, and not denying it. It's a win/win for everyone. The employee gets a new position with presumably higher pay, and the employer gets a chance to hire someone who isn't going to make them "fight for you every 6-12 months".
So if an employee you have hired is able to get a competing offer every 6-12 months, it is worth spending time to figure why things are so screwed up in the company and resolve that.
Once or twice I can understand. Pay isn't always calibrated correctly, weird stuff happens due to company/employee history, whatever. But if your employee is consistently able to get higher offers once or twice a year then something must be screwed up.
2. Of course, because he wants to be paid like the market is paying people in his position, not to be the only idiot with a worthless salary.
Because, you know, they are asking you to offer them the same the competence is able to give.
What you want is an underpaid worker who never ask for a raise and have his mouth shut up for everything, hell you would take a slave if you could
Is there any other type of employee? You think it's a bad thing that people work for money? I'm not spending 40 hours a week out of charity. I only do it because I need money. I'm tired of people trying to make employees feel bad because they want more compensation.
Do you have a lot of millionaires trying to join your startup as an employee? If you don't, then money is probably a major motivating factor for all of your employees.
It's more likely ignorance of your specific market price than malice.
First, the employer isn't even going to know your outside market price if you don't get an offer in the first place. For you to prove that you're worth the 10% salary increase, you would have to be vetted by a prospective employer as having met their requirements to be hired at some price.
Secondly, your current employer needs to agree that you're worth that 10% salary increase. Their perception of your value may simply not match your own perception of your value.
In these situations often the employee is getting raises that do not even cover inflation. So the employee now sees their market value and would like to continue working for the company, but they have realized they could take on risk for a 20-50% raise instead.
I mean the risk equation is simple, with such a raise you can save enough cash to justify the risk even if it doesn't work out.
I always ended up taking the offer from the more generous company, and they tended to increase my pay to offset more than inflation and then a bonus to justify staying.
By saying that you'd rather they talk to you about salary directly instead of getting competing offers, you're essentially saying that you'd prefer them to be uninformed about their true market worth when having the discussion. You probably don't mean that, but that's the result.
One thing employers need to realize is that this is 95% of jobs. I'm not a developer solely for money. But I am a developer at your company mainly because of money. I would have to imagine that the vast majority of people are in the jobs they're in because of the money.
Talking about my dissatisfaction with pay during 1:1s has never got me a raise. Getting a competing offer has.
> 1. If the employee is only motivated by money, he will be gone rather sooner than later as there is always a higher offer around.
I may not be motivated only by money but money is a motivation. I am selling my skills in exchange for money, so it is in my interest to sell my skills to the highest bidder that matches my other requirements such as good role, autonomy at work, etc.
> 2. If you give in once to this, the employee will come back 6 months later with demanding the next pay rise.
Only if you are paying him below the market rate. If the pay is at par with market rate, it is not going to be so easy to come back 6 months later with another significant pay rise that is hard for you to afford.
Are you fucking stupid? Your employee is giving you a chance to retain them. They want to work for you, but can't make it work financially, and you're turning your nose up at them? For what reason? It's probably going to cost you the money to hire someone new that it would've taken you to retain them! I will never understand this line of thinking.
And, no, I don't buy the line that companies can't find the money for their payroll. Not when corporate savings are at an all time high.
So? What have you lost then? You upped their pay for a short period of time and now they're gone. Big deal. You've lost an employee who didn't want to work for you anyway. Seems like a fine outcome.
OK, and if it's unreasonable, they're probably going to have a hard time getting it. Or you won't be able to retain good talent. I'd say if it's the latter, you might want to restructure your exec bonus structure.
> 3. You might have done something wrong in the past. An employee who can envision herself in the company in some years in a different role with personal development and fair pay rises (see 4.) does not leave.
First off, I like that you say "her" as though you're not part of the problem in the .75/$1 shortchanging for women (hint: it comes absolutely from companies being tight gripped on their payroll and playing hardball in salary negotiations). That aside, I'm not sure I get your point here. You're saying you wouldn't provide a pay increase, and here you're saying that your employee's perception of that being the case might be a problem. Gee, I wonder how they would've gotten that perception...
> 4. You might also have no transparent pay rise process in place and clear guide lines why people have which salary. You might also have a wide band of salaries, which will bite you sooner or later.
Yet again, not sure how this affects the instance where an employee comes to you asking for a pay rise commensurate with offers they're receiving. Seems like a good time to get your pay structure under control.
5 and 6 seem to be tips all of a sudden on how to be a worthwhile compensator, so I'll ignore those.
Be civil. Don't say things you wouldn't say in a face-to-face conversation. Avoid gratuitous negativity.
When disagreeing, please reply to the argument instead of calling names. E.g. "That is idiotic; 1 + 1 is 2, not 3" can be shortened to "1 + 1 is 2, not 3."
Is it civil? No, but neither is cutting the legs out of a generation of employees because you're too dimwitted -- or worse: greedy -- to not pick up that dollar next to the dime.
You can be 5% off of market or even 10% if its a nice place but once you go past that, do you really expect your employees to sit there and take it? I know my landlord's not gonna wait for me to get a raise before they raise my rent
1. If the company is not paying you well now, it will also not give you timely raises or promotions, so you will have to do it again and again.
2. If there's a great team there, and the only problem is with the money, unless it is a temporary thing with known causes, odds are the entire team will leave soon. So it's not something to consider.
3. It's very likely that your employer will work towards replacing you and will let you go on their schedule. It's always best to leave on your schedule than getting it forced onto you.
"Build strict processes for potentially political issues and do not deviate—Certain activities attract political behavior. These activities include: Performance evaluation and compensation [...]"
In a lot of places, having a talk with your manager about your salary before going off and actively looking for other offers is going to go down a lot better. Most line managers worth working for, value their teams and will fight for them if they are unhappy, without the threats.
And TBH, if your company has to make cutbacks in the future and you've shown you're willing to up and leave at the drop of a hat, you're name's likely to get further up the redundancy list than you'd probably like.
"Pull this on you"? You sound like a real joy to work for.
This is expressly why I choose gigs where I'm working directly for an owner if at all possible. If you've created value, owners know how important you are and will take your request seriously as long as it's reasonable.
In my career, I have received 100% of the raises I've requested ... at least a half dozen times. I've never once received a no or even negative push back. Owners were eager to retain me.
Even if your intention as a "line manager" is to not give the raise, the right move is to at least feign consideration for a few days and show the employee his request at least matters enough to think about.
Letting everyone know they'll immediately be shown the door if they dare request an increase would create a terrible culture. Clueless management.
The person to whom you're responding explicitly drew a distinction between discussing a raise with your boss vs going to your boss with another offer that you have secured.
I can see the importance of that distinction. To put the relationship in a different context: Imagine the difference between a girlfriend who says, "Hey, we need to discuss the amount of time you spend playing video games. I'd like you to pay more attention to me." vs "Hey, I don't like the amount of time you spend playing video games, so I've been talking to this new guy about being my boyfriend. Your move."
Because it's only OK to ask for a raise when the boss has the upper hand?
That would be the upper hand.
Before that, it's just a discussion.
This industry doesn't value engineering experience. It values breadth over depth. There are some exceptions. But the data are what they are.
Every day I go to work, the implied threat is that my company could assign all my work to someone cheaper--generally speaking, give 1/Nth of my work to each of my N co-workers, then advertise an open position if that puts the team over capacity--and abruptly end our work-for-pay relationship. Or maybe they allow a tester to jump up into development, and give them tester+1 pay instead of developer pay. If I meet with my manager with competing offer in hand, that may invert the status quo of the power balance for all of 15 minutes. How unnerving for them.
You always need the company more than the company needs you. That's a corollary to the whole point of having a company, which is to produce an entity separate from and greater than its constituent parts.
Personally, I'd just keep silent about the amount of the competing offer and ask for a raise. They can do their own calculations about how much they can afford to give, and if they can't match the competing offer without knowing what it is, I'd take it. Telling them what that offer is makes as much sense as divulging your salary history when seeking out competing offers, which is to say it does not make sense. Let companies do their own calculation regarding how much you are worth to them, instead of copying the answers off of each other.
Besides, that's exactly how they gauge what kind of wages to offer when they hire you -- from what others would accept in your place.
You don't fire your girlfriend in tough times, but your boss will fire you if he had to. It's a stricylty pay to play relationship.
Spouses are loyal back, businesses are not.
Not saying that you should be concerned about getting fired everyday. But if you don't create demonstrable value to your company over a longer period of time (a couple of years perhaps) don't expect to keep the job. Things are moving wayy too fast today.
Outside of my own direct experience, I can also recall many other co-workers' experiences where the companies I've worked for went above and beyond in their commitment to their employees. One time that meant making many extraordinary allowances for an employee suffering from a mental breakdown. At times it has meant extending the employment of someone who was looking for a life/career change, but the company kept on paying a salary until the employee found somewhere new to land - way beyond where the employment had any real benefit to the company. There are many others.
By all means, takes some precautions. By all means, stand up for yourself. By all means, make sure that you're being fairly compensated... but if you go into every relationship, personal or business, with your shields raised and phasers set to kill - you will reap what you sow.
I know that personal relationships aren't exactly the same as business relationships, but to pretend that they aren't somewhat analogous doesn't line up with my own experiences. I've had a lot of personal relationships in business. Almost every boss I've ever had has been my friend on some level and the same goes with a lot of people who've worked for me.
When you treat people with respect, consideration, and friendship in your work life - you'll be surprised at how often you get the same from them in return.
Getting independent information of your value isn't "guns blazing."
Going out and getting a job offer is a step beyond that.
Work is NOT like having a girlfriend. Like the other poster said, a better analogy is your relationship with a prostitute. But it's good you brought up this incorrect analogy, because I think it really shows the horribly wrong mentality that bosses have, because they believe this to be a good analogy even though it isn't.
I'm not showing up to work every day because I have any warm and fuzzy personal feelings for the people there (especially the management). I go to work because they give me a paycheck. That's it. It's no different than prostitution, except not quite as icky. If my girlfriend tells me she needs to spend less time with me for a little while because she's going to spend some time with her family for some family problem, or she's working on her own start-up business and needs to spend extra time on it to make it successful, etc., then sure. If, however, employer tells me they need to cut my pay in half because they're having money problems, I'm immediately going to look for a new job. I don't have any personal feelings for my employer, and I don't expect to grow old and retire with them either, and I also know that if they don't need me any more, I'll be out the door with a pink slip that day.
I think this analogy really shows how many employers think (wrongly) that employees should have some kind of loyalty to them, even though the employers rarely have any loyalty back to the employees.
On the other hand, sending every other employee the clear message that the only way to get a raise is by showing up with a better offer isn't the path to the best of cultures either.
Those that imitate the tactic are not the ones to be concerned about, the others are, those who have nonmonetary reasons to stay. Employment isn't equally fungible to all employees. The less mobile will feel screwed and their motivation and productivity will suffer. Getting paid less than market rate is much easier to not mind about than getting paid less than the guy across the table. Secrecy could be a solution, but before you embrace it all too enthusiastically ask yourself twice about the gossip level in the organization.
In the end, the ratio of "will imitate" employees to "will grudgingly accept" employees determines the better answer. The former will hate "aggressive bargaining will not be tolerated", the latter will hate "only aggressive bargaining will be rewarded".
If my manager wanted that, it would have been in the contract [that I have never had as an "at will" employee], and they would have had to pay something to me as compensation.
If I have no contract, I owe my employer nothing. The loyalty I give them is equal to the loyalty they promised me: zero. They explicitly told me I could be fired at any time for any reason from an enumerated list ten pages long, or for no reason at all, if the whim merely struck them one day.
As an employee, that is a big "fuck you" to me from the management, and they should be happy that I even let them know I might quit if they don't do something soon to prevent that, instead of just calling my manager up to say I won't be working there today, as another company offered me a better deal.
If the answer to that is no, no amount of backup will convince them otherwise. Then you get into the question of "why am I working here" and it forces you to leave anyway.
Somehow, all paths lead to leaving. And I think this is what the original article is getting at - if you want more money, your best bet is to leave.
As your potential employee I'd be more than happy to shake your hand and leave. Very rarely does a company deserve employee loyalty, and you as a linemanager should at least try to earn your employee's loyalty by paying them what they are worth, rather than what you can get away with.
Remember, you too have a boss, treat your subordinates like you would like to be treated.
I did just recently have a good turn where the recruiter who helped me land my current job helped negotiate a bit higher pay and a week of vacation. I wasn't going to push that hard because I needed to be working and not sitting on my ass, but he did this for me without my asking and it worked. I was pretty thrilled that after so many years, someone else gave a damn about me. First time.
This makes it impossible to adequately take employers up to your real market worth as a long term employee. Too many of your coworkers will accept 50% of their worth rather than risk stress and a crises if a change falls apart. So as long as the employer only needs a kernel of long-term employees only a union has the necessary leverage.
One of the most important reasons software development is not like actual engineering is because the practices associated with actual engineering aren't valued in the world of software, even though the political components of employment (e.g. loyalty, longevity at a company) are considered signals of high(er) quality.
The vast majority of developers simply don't have quality employment options for most of them to consider long-term (> 3-4 years) employment with a single company to be a good economic or career decision.
In a smaller company, I would be worried about 'revealing my hand' to a potentially vengeful manager asking for a raise and I would rather just leave than try to get them to counter offer. That is, if I ask for a raise and s/he denies it, I would feel that I would probably be the first one to get cut when the time comes so I might as well leave. In a larger company, I might try to work with the manager on a 'career plan' assuming the manager in question is not toxic; the toxic ones will pretty much ensure that one gets a 'needs-improvement' type rating, which pretty much limits any movement for the unfortunate employee from that point on.
This doesn't agree with the research here, and your first statement doesn't agree with your second. If you value your team, they shouldn't end up unhappy with their salary, and they shouldn't be thrown under the bus for exploring what they're worth outside the company. The tamest threat to fire them reinforces the point.
Outside offers to get a raise are a risky business at best. If someone is unhappy enough to do this it isn't just compensation most of the time.
It all depends on how you are managing the compensation growth appropriate for people who are growing in their careers - if you're doing it properly and proactively, then people won't be repeatedly coming to your office with solid evidence that the actual market rate is much higher than whatever you're paying; and if you're giving appropriate raises only when pushed to, then doing that seems to be the only way how your existing employees can continue to get paid market rate.
The probability of someone leaving didn't change because of the new offer, the manager perceives a power differential and is responding to that.
It isn't the wrong call to keep someone on and counter, it is just a tricky situation.
If I go in with broad market data, the argument could be made that my specific circumstances make the general market data invalid.
If I go in with specific job offers, then I present myself as a risk to leaving, and the conversation may be more adversarial than I intend.
So could there be a service that sits in between? my-market-rate.example.com. Employees submit resumes, and we abstract the companies, roles, etc. Submit those resumes to companies to get an expected salary for that position and indicate interest to hire.
It is a difficult position to be in, but I think the solution is relatively obvious. If you think you are being underpaid and you don't have an open line of communication to your employer about your compensation that is the crux of the problem. If you can't comfortably discuss compensation at any time with your manager in a no judgment zone where the employer immediately assumes you are leaving then you and the employer lose. At that point you may feel the only option is a competing offer and the employer may counter, but they will be counting the days until you are gone.
A middle service could help keep things fair, but any employer you would feel comfortable using something like a `my-market-rate.example.com` service report with you probably already can just have an open discussion about compensation without any concern. I could see it being useful in some places where the organization / manager really does just lack information about fair compensation but... that strikes me as pretty uncommon. Managers tend to know far better than employees their value in the wider market and to the organization specifically.
Ultimately, you just have to do your research and if you know you are underpaid you should be able to find employment somewhere else. If you fear a comp discussion would trigger your employer firing you, time to look for another job. If you think it won't change much, time to look for another job. If you think you are close and have a good relationship with your manager, just talk about it. In my experience employees, especially in high tech, are very worried about discussing compensation and how that might be perceived by their manager. In reality many folks that generally like their place of employment and end up where they come in with a counter offer could go back in time 6 months and have a direct conversation with their manager and get a raise (or not, signalling it might be time to move on). If it takes that competitive offer to budge your employer it means they know you are worth more but they weren't willing to give it to you fairly.
Anyhow, that is my brain dump on how these things play out.
At the end, a research and analysis firm in this space says 50% leave within one year. I could not find the papers. I actually researched this a lot when put in a situation that we had to make a counter offer and there are some better papers and such out there, but I don't have it handy.
You have to go case by case and really understand what is motivating the individual. There is a very high chance the relationship is beyond salvaging. But there is also a good chance you can fix the problem. It is much better to never be in that situation to begin with (preventative maintenance). Regardless when you get to the point of making a counter offer anecdotal experience and research indicates it is about like flipping a coin. Maybe you can gain some insight via discussions and back story that make it better than flipping a coin, but the basic idea is you are in a relatively unpredictable situation at that point, no matter what.
Whereas, having constant and open communications with employees, discussing comp and making sure all issues stay little issues prevents these situations. Eventually someone may leave, but in my experience you can almost always remove the chance they come to you with a competitive offer. They will know where they stand with the business and be getting a fair wage or they will know it is time to move on. It is a much better relationship than an employee feeling they have no recourse but to drop a bomb on your organization.
That said, it is understandable how this happens with "line managers". e.g. middle managers. Individuals not empowered by corporate structure to do the right thing. But in orgs of less than 100 people this should never be happening.
There's no contradiction in that.
I was only pointing out that underpaying staff does not equate to not respecting them.
Most line employees don't have enough influence over the business plan to point out that, say, it only works if the company can live with a high turnover rate or with keeping salaries low.
None of this is personal. It's actually a big ask for someone to get paid under market rate or work on horrible legacy systems for years. Managers shouldn't take it personally if they ask for something big and don't get a yes.
That said, if your growing etc and just have a cash crunch then stock is generally an option.
I wouldn't dispute that seeking offers before a request for raise might not go over well (depending on the specific business), but I think calling it a "threat" is needlessly weaponizing salary negotiation in a market where everyone acknowledges salaries have been flat for a long time.
The number of people employed in IT services as a whole as increased which has likely helped keep wages more stable. It's still a good career as far as salaries go.
One thing I've found that makes digging deeper challenging is the preponderance of titles and roles. Title inflation could disguise wage growth to some degree.
Of course, said employee better be good at his job to get this treatment. If you are obnoxious or merely just barely good enough it will be an easier way to get rid of you than go through the hassle of big company firing procedure.
Though I have to admit I never was in this situation as a manager, I did give fair share raises out of the pocket money I got to distribute as raises between my employees.
Wouldn't care to work for you at all.
It could also be an opportunity to add valuable responsibilities to the employees role to justify the increase in wages, if thats applicable to the situation. Win-win for everyone.
That is not my experience at all. Saying that I am leaving brings salary pay raise offer immediately, asking for pay raise brings vague promise for pay raise if this or that, yadda yadda. I cant recall manager raising salary proactively to anyone, ever.
It is not that they would not value their teams, but they do see world in a business negotiation way and see it as their job to manage expenses too.
The threat of disloyalty being punished if there are cutbacks does not seem like all that much threat to me. There are so many factors in the decision, including who likes who and who drinks with who, that this is just a tiny drop in the bucket. Nevertheless, when there are cutbacks, having recent experience with job search and idea about how much money you can get elsewhere helps way more then theoretical sympathy - it reduces stress even if you are one of those who stay.
This has got to be some of the worst career advice I've ever heard. I made this mistake once, at my first software job. My employer's response was to say "NO" and then proceed to make my life hell in an attempt to make me quit. With a wife, kids, and a mortgage, that wasn't an option for me. I was eventually fired (for poor performance, a mere 2 months after receiving an 'outstanding' yearly appraisal) and spent 2 months unemployed before landing my next job. On the plus side, the offer I received was higher than the raise I had requested from my former employer.
So, my advice: Trusting your manager to be a reasonable human being is not worth the risk. You are absolutely satisfied with all aspects of your job, including your salary... right up until the moment you hand your boss a letter of resignation.
Now if you have a large amount of savings (say 6 months - 1 year of living expenses), feel free to take stupid risks. Otherwise, have another job lined up when you ask for a raise... you don't have to actually tell your boss about it, after all.
Would you give this advice in reverse too? Ignoring lawsuits for a minute, as a manager - should you always tell your employees that they are doing fine, even if they aren't, right up until the moment you fire them for poor performance?
Agreed. I've already gotten my team the best raise/promotion that I could. If they can find better at a different company, I wish them well.
And that's not sarcastic. I genuinely wish them well. It hurts to let a good employee go, and finding/training a replacement sucks, but we're all kind of stuck in this shitty US corporate culture together, and we have to look out for ourselves.
Then again, this employee has just presented you with evidence that maybe your compensation isn't competitive, which is something you can bring to the higher ups to increase your budget. If you're not competitive, you'll have retention problems and business will ultimately suffer.
So you got the best rate you could at the time with the information available, but competing offers could change that equation.
if your company has to make cutbacks [...] you're name's
likely to get further up the redundancy list than you'd
I'm going to need a new job anyway, just in the latter case I've put in a few extra months where there was no money to give me a raise no matter how well I performed.
An employee ready to jump ship quicker than his peers means that his value is reduced to the organization, precisely because the long term value of the "internal knowledge fee" is reduced!
I agree with the OP's tactical move, but strategically I'm not so sure the mindset is the correct one. Maybe I was lucky, but I always had managers that stuck their necks for me. Full-time employment is not a consulting job that is fire & forget.
There could be a selection bias: does it show how many people switched to a job that turned out to be worse (pay/benefits/quality of work), or people that got fired because they had a much lower tenure than other employees, etc, or the cost of retraining personally for a different position.
1) It's not a matter of being happy or unhappy. Just about everyone wants to earn as much as possible, the goal being to get as quickly as possible to the point where one no longer requires employment.
2) It's not possible to know how much the market values you without seeking other offers and seeing how much they'll offer you.
3) If one of your employees comes to you and says "I would like a raise" with no additional context, I can't imagine you're likely to offer them much. If they say "I need a raise or else I'm going to start looking at other jobs", I doubt you'll treat that much different from coming to you with an offer already in hand.
As an employee with a manager like you, it seems like my best best is to get an offer first, and then come to you saying "I'm really happy here, but you're not paying me market rate, and I think I would also be happy at this other company that will pay me more."
Most people don't have this goal. I personally have it (FI/RE), but most don't, even most software engineers. This is pretty evident by the cars that they drive and the other money that they can be seen "wasting".
Some happy medium is really what people want.
Playing the devil's advocate, here's employee response which makes sense from his/her perspective:
But I have job offer paying 30% more. I could actually get multiple offers like that from several companies. So I am not afraid of your threat of "getting further up the redundancy list".
It seems to me that you, scarylam, would be a good line manager to work for.
But the reality is that most would not fight for you. Especially not when the two options being weighed are spending more money or having a somewhat dissatisfied employee, and maybe losing them later.
If the employee has some form of recourse the decision is very different. Spending more money or losing a part of your team now.
make you do your job as a manager?
> having a talk with your manager about your salary before going off and actively looking for other offers is going to go down a lot better
because then the employee doesn't know the market rate and the manager can get away with giving a garbage raise. Of course that's going to go down better, it's less work for the manager to dig it out of the budget or their boss
Edit: Made it a little less personal, my grudges are not with you.
A serious question for scaryclam (or anyone who agrees with him): Why is this? Excluding a few people with dream jobs, I didn't get hired at Company X because I love what they do or I feel they add to the world in a meaningful way: you guys needed code written or systems maintained or whatever it might be, I needed money. That is the extent of our relationship. Even if we've worked together for a long while and developed a bit of a friendship, it seems like the whole stigma surrounding bringing job offers into a workplace is based on a few things that when said aloud sound insane:
1) That I would be willing to subvert my own potential success for the good of Company X, which seems at best like a weird trade-off and at worst like some sort of cult;
2) That Company X doesn't want other people in my department to see what they could be making elsewhere, in which case see #1 for each of them and add to it a line of disingenuity to it too;
3) That Company X already knows that there are better competing jobs in the area (or close enough to threaten them anyway) and are taking internal action to prevent those threats from costing them employees in mass by trying to prevent employees from knowing about them, instead of raising pay/benefits to be more competitive
In any situation where a company is attempting to hide information of any kind, you can usually find a solid financial motive for doing so. I'm not saying that a company should always be paying everyone as much as they possibly can; obviously, each side of this table has their side to fight for. But if one of the sides is being dishonest about the facts then that side has already lost points going to that table; you say you'd fire me if I came to you with a job offer? Odds are that's known and I'm already on my way out, and whether you want to call it good or bad, that means you've lost me, and you're probably winding up to lose a few more.
But you don't make PEOPLE redundant, only POSITIONS.
If you are using redundancies as cover to target individuals that have annoyed you, then you will be shortly staring at the business end of a tribunal.
If a company has 10 developers and needs to cut down to 7, then the folks who have actively been interviewing in the near past are going to be considered more of a risk, especially by HR, who are likely to be making the list.
Hiring is an expensive endeavor, so if HR sees someone as a risk and they need to cut positions, you can bet that they're going to see it as a better thing to let employees who have a risk factor to them go than others who don't (on paper that is, no-one can know what's going to happen tomorrow).
They definitely don't want to cut the staff down and then have to go into a hiring stage soon after, because someone who was getting itchy feet decided to walk with another offer anyway.
This isn't about targeting people just because they want more money/fairer pay/more holiday/bonuses. It's just about how companies behave.
Sounds like it's still good advice if you won't fight for your employees to stay. The alternative to being upfront with your manager is just leaving when you think you can do better - many managers would prefer not to have the surprise.
> you're name's likely to get further up the redundancy list
Not my experience. In some cases, the employees able to leave easily are the better, or underpaid ones.
Relationships are important, sure, but you have to understand: management is not typically the friend of the worker, nor is HR.
Business is business. If they find someone to replace you at a fraction of your salary they will do it at a drop of a hat. Your manager pbly gets a bonus for reducing spending...
Wouldn't that be a good thing if you actually can get a job at the drop of a hat? If the company is doing badly then staying is probably bad for your career, plus you often get a redundancy payout.
If anything, it's probably worse to be at the bottom of the list - that often means that you're viewed as a bargain - i.e. you're being grossly underpaid.
Demonstrating that you're undervalued is not a threat, it's feedback on how the market values your employees. You give feedback on how well your employees are serving the business right? Why shouldn't it work the other way around?
Your work is not your family, this isn't personal judgment or criticism, this is just business.
Some of the tools for a quid pro quo relationship that extends beyond mere money include being able to tell people about big moves so that their lives aren't caught off guard. Coworkers help each other out in this regard. But should management?
People make their plans around timing, geography, and revenue from employment, and when management doesn't reveal big layoffs, big real estate changes, or other big restructurings, people have to up-end their lives. Management knows this, but values some things more, such as the company health. In doing so they set the tone of the relationship.
Management isn't in the position to establish a rich and sincere relationship with employees. There's always an element of insincerity because management isn't telling you things that your coworker friend would, the coworker friend who calls you from another company after the layoffs, recommending you to hop ship to their company. Would management ever tell you to hop ship to Apple?
One might argue that management ought never be in a position to establish such rich and sincere relations. One gossiping manager and you might trigger an early exodus. Or a wave of salary conversation. So managers ought not even know the very information which would help their employees stabilize their life against the uncertainty.
Also, if leadership doesn't want a union, and plenty of world-class places don't like unions, what is management's position to play then? Obviously squash the union talk.
Well, glad that people know that, so that they can wish the company good luck in getting second rate talent.
Most good line managers will recognise their employees contributions to the company and suggest a raise/additional compensation without needing to be prompted.
But if I have uncovered a huge pay discrepancy, you have already failed me. Both you and your HR department in fact. Sadly, I suspect that across many individuals, this is a winning strategy because most people don't actively manage their careers (to their detriment).
If the company has cutbacks, everyone's head is on the guillotine and it's time to jump ship anyway before the signal hits the employment market.
A fool and his employees are soon parted.
Sure but at the same time, that's only going to be one of the many elements that influence your position on the list. Actually, as far as redundancies go, being treated as an individual instead of being handled in bulk with specific project/team means that you are already rather higher up or a key employee for some reason meaning either your are a political animal or with a very good negotiation position.
And TBH, if the company is making cutbacks, all of the competent people will be scurrying away first; you might as well be one of them.
> I imagine this is good advice in some places, but as a line manager, if you
> pull this on me I'm more than likely to shake your hand and wish you luck in
> your new job.
If you make such concession for one employee, the next day you'll have 5 others with similar demands.
EDIT: One more thing: the reason why it is often easier to get a raise by changing jobs instead of negotiating it in your current workplace is information asymmetry.
Your current employer knows you all too well, so it is hard to convince them to pay you more. Potential new employer does not know that much about you, plus they are in need of new employee so they are more likely to give you more money.
Management knows the market rate for a given role. Let's say a good-not-great senior developer (as in give them a code base and a quiet room and you've got substantive code on day 1 or 2) commands $100k cash comp to make the math easy. You take the job for 10% below market for whatever those reasons happen to be. Maybe your last job was only $95k but this one has a much better vacation/retirement package.
If you go to your boss after 6-12 months of being a good senior dev and a good employee (meaning all the admin nonsense that comes along with being an employee - meetings, timely communication, generally not being an asshole, etc) and say that market rate is $100k, you're getting paid $90k, and you'd like $100-105k, they know that's a fair ask. Whether they are willing and/or able to actually pay you that ask is another thing.
My point being that there's nothing "terroristic" about asking for what you're worth. You can do it without a competing offer, but often times a competing offer is the easiest way to get something close to a market rate number.
Illusory superiority is a real issue - about 70% of people think they are above average, so they keep demanding above-market salaries.
Plus, as I mentioned in my previous post, other employers have harder time evaluating person's skills through interviews than a company that currently employs them. So they offer above-average salary to your average employees and by the time they realize that they overpaid for their skills it usually is too late, so they keep them on payroll anyway - that's basically how IT salary bubble works, most of the time :) (at least that's how it works in Poland, I don't know a thing about US job market)
From my experience the reason why employees who have another offer even bother to mention it to their current boss, asking for counter, is because that other offer has some serious downside that prevents them from just accepting it right away.
Anyway, I can probably replace you with someone that will gladly take your current salary. And if I can't and end up paying your replacement the money you demanded (or more) at least I'll be paying that to the guy who is happy to work for me, not to someone who is already actively looking for other jobs.
If you're not offering similar compensation to other organisations, then anyone interviewing and getting offers from multiple places will likely not pick your organisation, unless you can compete on some other metric.
> the reason why it is often easier to get a raise by changing jobs instead of negotiating it in your current workplace is information asymmetry.
Yes, probably. Because without interviewing at other places you don't know what your skills might be worth, and your employer is probably not going to tell you how much your colleagues are getting paid and your 'boss' probably tells you "you're getting above industry average."
Also don't believe any line manager or anyone else here posting that this is not a good strategy, because remember, every line manager is only an employee as well and has a line manager as well and they want to get paid a fair salary as well, so they either will do the same or they will have 100% understanding for it and if they don't then you know that the company has no interest in paying you a fair market value for your contribution.
This is the free market, companies love to play the game when it comes to having people let go (like SoundCloud), when it comes to taxes and when it comes to profit distribution and growth, so they should also expect to play the same game when it comes to negotiating employee salaries.
This works both ways.
The value of internal knowledge helps both parties, because as an employee you dont know if x other company is good to work at, or that you would like the responsibilities there, etc. The fact that lots of people stay with a lower salary in a job is a testament that it is often the employees that choose to pay that fee.
The company is frequently interviewing. So if the company finds a candidate that would work for less (minus the internal knowledge comission) it should fire you and replace you!
So the fact that "company is frequently interviewing" only shows how much demand there is and how hard it is to fill a position with the right person. Once you have the right people on board, they can ask a lot more than what they get, because replacing them can be significantly more time and resource/money consuming and then it's not even guaranteed that they will be as good as the ones you have right now.
This is basic free market, the side of it which has the upper hand right now needs to play its cards to max out wealth and every employee should be encouraged to do so, because it will overall only increase economic growth. It doesn't always has to come from business growth, if workers can gain significant wealth based on the same principle then they should, because it will only increase more spending and investment of those people into new areas again.
I loved your comment about "max out wealth" because that is the underlying truth to all of this--you get maybe 30 years to make as much money as possible and that's it!
This is of course for people that value what they do at work and want to make meaningful impact professionally in their lives. For other people family is much more important so it doesn't matter if they don't min/max the projects they work on.
That employees "pay that fee" doesn't indicate why. It also doesn't provide insight into whether it makes economic sense for them to do so.
This is a flawed philosophy. As a manager I have had a few critical pulling in higher salaries than my own. If you are a superviser who is artificially holding an employee back from reaching their full potential (seeking compensation that matches the demand person's talent in the open market) than you are doing your company (yourself) and that employee a major disservice.
Just because you are a manager doesn't mean you can do what your employee does (and vice versa). Artificially holding a sub-employee back is a sign of fear for one's own ineptitude.
EDIT: My main responsibility is to keep the team happy and productive. If this developer would leave the team our productivity would drop and we wouldn't achieve our goals we set for ourselves this year. It would have a direct impact on my bonus as well and it is in my highest interest to keep great people at every possible cost. If I think I don't earn enough then I will have that chat with my line manager, but I will never try to destroy my team based on some personal ego crap.
Which is better for the company? (A) Leader acts in such a way to make him or herself 150% effective, or (B) Leader acts in such a way as to make all of his or her direct reports 115% effective?
If a leader can't make their team more effective, then why have them in leadership?
(Edit: Essentially, what dustinmoris said!)
It is basically just a question of market forces. If a particular position is sufficiently specialised when the supervisor role is more generalised then you might expect to pay the specialty more than the generalised role - even though the generalised role is more senior.
Also, few people are truly indispensable. In all my time working, I've never seen a company fall apart from the loss of one important person. In fact, it usually takes a shorter time to cope than anyone anticipates.
I do agree with you, In the sense that as an employee, you're in great shape if you're seen at being essential, to some degree; I just don't think you're capturing the entire market dynamic.
The last company I worked for unequivocally treated their non-management employees like garbage. The company basically had the same management for 10 years prior, with a few "loyal" employees promoted to manager along the way. By "loyal" I mean that they were willing to sell anyone out to advance their own careers.
If the company even caught wind you were looking elsewhere, your life would become a living hell. Get ready for extra hours (Salaried, no extra pay), weekend work, Holiday work, getting your vacation time denied because they are "too busy", etc. Pretty hard to find a job when your employer is making you physically ill from stress.
In the meantime, the moment they catch wind of you looking elsewhere they start bringing in new candidates. Easy to fill those Bachelors-level positions after all, lots of recent college grads willing to not have a life in lieu of work, and they will probably want less money than you too!
I saw entire teams of 10+ people replaced within a year, then again, having to retrain their own replacements. The company even outsourced our work to Malaysia and we were warned not to tell our clients about it or we could face termination.
The only way to survive in corporate America nowadays is to be a cutthroat scumbag, no thanks.
If a company can afford to treat its employees like "garbage" then they will and that is the exact point that when the market is in favour of employees, they shouldn't be shy to treat their employer with the same scrutiny. Demand every penny you can get and if they are not willing to give you what you can get elsewhere, then be prepared to just go, because as you said very well, if the company would have that advantage they would do it as well.
I don't think that's the case, most of the time it's just employers being unreasonably picky. "10 years of C++ experience? You definitely won't be able to hack it in here, we use insert popular language of the day". Or, à-la Google, "we only hire the best, because doing mind-numbingly boring work that will have zero impact on the company bottom line needs the brightest minds on the planet". Or "can't hire gramps, they're too old". When there's a shortage you take what you can get and make the best of it, and it's not the case now.
Employment-at-will cuts both ways. If a company asks you to do this without adequate (and I'd definitely say bonus also merited) compensation, tell them to pound sand and walk away that day.
Pitfalls with this advice: your current employer is not dubious. They may know you are actively searching. In addition, once you have an offer and you bring this up -- your current employer will "try" to match that offer to try to keep you. Why? Often times this is the default to avoid disruption and often times you are well-liked and they actually do want to keep you. They may also try to "keep you temporarily" -- until they can replace you. Once you have said "you have an offer" it acts as a flag to you. Which can also mean you may be the first to go if anything happens such as layoffs. Thread carefully.
That said, if you can't stomach risk, then don't do this. But try to understand that by not taking risks now, you're taking a huge long-term risk on your financial future.
If you value staying at your existing job more than a raise then you are right, you shouldn't do this. But if you are okay with walking and talking about offer them this can be beneficial. I have even heard managers state that certain raises are not possible without another offer that they can bring to HR/whoever to prove that they need to pay someone more to retain them. Doesn't mean the manager necessarily wants to replace you, but it could be a sign of oddities within a large Corp.
I agree, but for a different reason. Not only would this behaviour annoy your employer, but it shows that your employer doesn't care to pay you market rates or what you're worth.
So why do you keep working for people who don't pay you what you're worth?
Accept the outside offer and move on.
Worthiness may be a mater of debate and thus the related pay - a subject for negotiation. If the employers recognize your worth (or just yield under your worth self assertion) and are willing to pay you accordingly, then you may discount malice from their part. If that happens, then there's nothing wrong with continuing working together. Count that former under-appreciation as a little misunderstanding that was addressed in a timely manner. You may choose to stay with them simply because it may be better to work with people that you already have a track record of good report than taking your chance with new/unknown business party. Other than that, elnygren offered a solution where you get both the benefit comparable with job switching without the bad consequence of appearing disloyal.
As an employer, it's hard to know how someone's market value fluctuates. The only way to really know is for the employee to do a job search.
There are several ways to figure out the market rate for a position:
1. Post an opening and see what the salary expectations are of applicants
2. Talk to recruiters and see what similar positions are paying
3. Use your network of people at other companies to find out what similar positions pay
4. Look at salary data for your industry and region
I agree you probably won't get a precise answer from any of the above, but it should at least give you an idea which end of the spectrum you fall.
You can also talk to the employee and try to get an idea whether they're happy with the position and compensation. My personal preference is for this to happen multiple times per year, instead of just at an annual review.
I have seen this situation play out so many times. People who don't move around aren't being paid what they're worth and are effectively leaving money on the table.
The Forbes article only scratches at the issues involved in the tech biz and each point made could have a full article written about it.
I went to my boss and said, X is carrying my team, he does more than any two other developers combined. He needs a raise, I can't lose him! And he got it.
If you got someone who's good, that's what it boils down, either play ball or lose them.
I only escalate if I find out I could be making 25% more or greater by leaving for a desirable gig elsewhere. At that point, yep, I'm underpaid. Otherwise, I suspect you are overoptimizing one axis of employment potentially at the expense of the rest.
That said, I've never been at a tech company where people have been promoted every 6 months. At best, every year, and more like biannually or worse.
Finally, don't play games like this if you're not a superachiever. You will be shown the door. And while you can fool some of the employers all of the time, once you've hopped enough times, it starts being used against you in hiring.
But I agree that one shouldn't get attached to any job, it could go away in an instant.
What I find interesting about the article is that an average time-in-place below about two years and absent a few longer stints basically takes a normal-ish resume and turns those short gigs into red flags
The really short work time thing shows lots of potential issues. Employee has never "shipped" and lived with the consequences. Employee flees after making a mess, either personal or professional. Employee has a problem with chasing the new shiny. Employee makes terrible decisions about fit and chooses gigs that aren't a fit for bad, ephemeral, etc. reasons and then when those cease to apply (financial stress alleviated, no longer a dog friendly office, etc.) employee bails. Another variant of poor fit is maybe employee tends toward emotion (desperation - I NEED A JOB NOW) and takes something they never would have taken otherwise. Maybe employee picks fights with other employees. Employee doesn't know how to bond ... the list goes on. Even simple pattern matching: The people everyone has known who are frequent short-time-in-place hoppers tend to be flakes so maybe employee is just a flake.
Someone below has a pretty good comment - "You get about 30 years to make as much money as possible and that's it." At least in technology, that is very true; less so in medicine or dentistry for example, and naturally capital doesn't really benefit from employees understanding that. It's so much more obvious to me 20Y in how true that is.
One thing I think is interesting: the average genXer that I know has never, ever thought strategically about their career and has spent the last 15-20y assuming things would follow a sort of generic life sequence; the sort of "a career is something that happens along the way" mindset. In contrast, while I personally may not like the stereotypical millennial aspirational trappings, at least some of them are viewing career as something they should be piloting instead of being along for the ride; not just waiting for a layoff or firing. At least they give the appearance of being better about it. But then again, so much of their appearances are curated fictions so who can tell.
If they value me, and respond to my forthrightness then we'll figure out something workable for us both. If not, I find another job and leave.
Alternatively, you can talk to your boss ahead of time (say 6-12 months) and specify what you want and ask what it would take to achieve the goal (promotion, raise, etc.). Then you execute your agreed upon plan. If, at the end of that period, they fail to uphold the agreement then look for another job and leave.
Your recommended approach is akin to being in an unsatisfying relationship, and, instead of talking to your spouse/partner/etc. you go find someone else then go back to your spouse/partner/etc. and say, well, I'm going to leave you unless you do X, Y, Z. Hah! For most of us that approach would not work out very well, and for good reason. It's not the way reasonable, mature, people of integrity behave.
Plus, I don't want to work for anyone who doesn't actively recognize and reward my value, and who requires (yes, there are places like this) you to go through the whole job hunting process and bring them an offer letter to give you a raise. F that. Ideally, the employer recognizes the value I provide and proactively rewards that value. Second best is employers who will give real raises (10%+) when an employee points out how much value they provide. Third best is real, 10%+, raises annually.
The current status quo of 2-5% increases amounts to little more than COL, and is utterly offensive. That's not a performance based increase, that's simply a retainer.
As an employee I'm acutely aware, as year #2 comes to a close, that if I don't get out there and find something better (better title, better pay, better benefits) then, in terms of opportunity cost, I'm losing money. Though my current position my prove to be the exception to that rule. We shall see.
And yes, I run all the numbers on the total value of my compensation package and any improvements/increases which have transpired over the previous years.
But getting other offers and then using them to force your employers hand is just childish, in my opinion.
If they do make a counteroffer and you stay, you can be sure they are now looking for a replacement.
1. Even though you may be able to get a 50% more offer somewhere else, your value to your current employer (note not perspective employer) is mostly determined by your contribution to the team and comparable peers at your team/position in the company. Your market value was already considered when you first offered/joined the company, after that it's usually not a major factor to determine how you worth.
2. Your many short term tenure employments and the tendencies to job hopping is a STRONG bad sign for the long term health of your career development. And it deters future employees. It may be fine to be a junior engineer to hop jobs frequently BUT it's really hard to move up the ladder to management. More importantly, it shows that you have no loyalty to any single past employers and will not willing to invest in a long term career development track to rise up (with a few exceptions). For example, I was told anecdotally that BridgeWater Associates would not consider anyone who hops more than 3 jobs in a ten year period.
3. You rarely accrue long vacation where most companies offer that based on tenure, again with a few exceptions (companies with unlimited vacation days policies).
4. You have to build up personal relationships with a new team every other year (assuming you job hop less than 2 years in every job.) Trust me, your personal relationships with your close teammates is a big factor in job satisfaction. Meeting new people new team every other year could be cumbersome and tiring. This matters if you are aiming for a long term career development.
5. Less than two years of employment might not be long enough to really build up your values. According to Jesse Watson, as a software engineer, your value really lies in "the synthesis of programming skill and deep context in the business problem domain, in one skull." And it's unfortunate that less than 2 years does not strengthen that synthesis one skill but rather makes your more vulnerable to be replaced by outsourcing as a commodity monkey coder.
I used to work for TheLadders.com first job out of college and gained a lot of insights because of that. And I am very thankful for the valuable advices my former colleagues gave me. Although I job hopped a lot when I was a junior engineer but not anymore given all the reasons above.
So next time when you are at the crossroad for a switch, make sure you truly understand the consequences of pros and cons. And be sure to ask yourself, is my career development ready and worthy for short term 50% bump?
I agree that you shouldn't get too attached to your employer, but this is way too cynical. Employers are people like everyone else, with individual personalities, and aren't typically soulless profit maximizers.
This was a small company though. I'm sure larger companies where mid-level management is in charge of hiring, the strategy of taking competing offers to your boss works well.
So it's not relevant and nobody should be blaming women for not being able to give you a raise. If someone in management at your company tells you that, they are lying to you and you should change jobs.
I don't think either is likely.
But guess what...
They care about one thing, dollars. If you are making them money, they will keep you no matter what. If you are not making them money, they will get rid of you. Pretty rational I think.
Corporations are run by people, and they draw on a huge variety of sources to make their decisions. Including, obviously, some that are not rational.
If women choose to forgo higher salaries in favor of something else, that's a different issue and it doesn't immediately mean that they are being "irrational", it just means they favor different things than men do.
If the hiring managers (of any gender) have an irrational bias towards thinking that women are not as effective as their male counterparts, this will affect the respective pay scales even within a competitive market.
Note that I'm not providing evidence or making a claim about the gender pay gap. I'm just saying that the claims you've made have many possible consistent explanations, including irrational bias against women.
And rationality of any one particular hiring manager isn't going to make a big difference; they still need to compete with every other hiring manager in the labor market and must offer something competitive accordingly.
But the grandparent's point is a sticky one: "it would be trivial for employers to reduce their costs by only hiring women." And yet ... no employer ever does this. They hire men and women. Also logical.
Either you're not telling me everything you know, or you're wrong. Without radical argument surgery, to make what you said square with GP, we have to consider changing the parameters in some pretty distasteful ways:
* It's actually the women themselves who value their time less, and let themselves get taken advantage of in salary negotiations.
* Men are more skilled than women for some jobs and those skills are in short supply. They get hired alongside women, but command higher salaries.
I tend to think there is no gender pay gap, but only if we adjust for people's choices to take breaks from their careers in order to raise families, pursue hobbies, mental health, etc.
I think the point being made was, if women are paid less, and thus cheaper to employ, they'd dominate new hires - presumably because salary is the largest cost for most businesses. So, as as an employer you'd want to minimize salaries.
Men are still getting hired, and that's the logical fly in the ointment that one needs to overcome - unless we allow for other distasteful variables to float, as I pointed out above. Or, we can consider there is no pay gap.
Companies think women are not as good workers as men.
That is why men are still hired.
Life is so good when rational arguments can hit a higher pitch than the virtue signals. ;)
But don't let facts stop you from repeating the same tired lies that have been debunked for years
It contains links to many more sources at the end.
Like wise the BBC being forced to disclose pay rates for talent some Male presenters have taken pay cuts btw
I mean, even if it's true that particular company is paying its women worse than its men, and even if legislation means they can't quickly fix it (I don't know how onerous this legislation is in the U.K.), the proper response on the part of any employee who is given these excuses ought to be "Look, that sounds like you have a difficult problem, but that isn't my problem. My problem is that my salary is $X when it should be $X+Y." Because at the end of the day their excuses aren't going to change the fact that they can either fix your problem or not, and if they don't fix your problem somebody else in the labor market can.
It's interesting because younger women hear the USA stats and complain about how they're being hard done by.
In both cases, it's because women choose to leave the labor force for a while, which makes them no longer like the men who made similar choices as them up until that point.
Sometimes men get awards in UK under equal pay legislation too but if it's true that men on average negotiate pay more effectively (and it appears so) then they will disproportionately be affected. When they negotiate and win a pay rise they are unlikely to get it for being male, it's going to be based on merit (largely) & retention needs; but equal pay legislation means a company takes on a risk if they can't sufficiently differentiate that workers output from another - of the opposite sex - who can claim to be doing work of similar value.
Example case http://www2.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/..., see also the ASDA case where working in a different location, doing a different job haven't been considered enough to warrant different pay.
Women are socialised to be less aggressive than men. They are also much less likely, statistically speaking, to negotiate their salary when starting a new job - never mind proactively seeking a raise based on their market value.
The solution - of course - is to have an employer policy of paying market rate, all the time. Satya Nadella got in hot water for talking about this problem in a gender neutral way, but the unfortunate reality is that an individual contributor can't hope to simply do good work and be recognized for it. Employees have to be proactive about ensuring that management has visibility into their work. Employers are incentivized to pay below market rate where possible and this will bite them in the ass when it comes to equal pay audits.
How would _you_ describe an agressive attitude towards one's career?
Long, but worth a read. Here's a section from the middle of it:
> Right now, the burden of child rearing disproportionately falls on women
> Some of this could be by choice — but there are also cultural forces outside of a woman’s control at play.
> Consider a study of lawyers’ salaries from Mary Noonan at the University of Iowa. She found that men see their salaries decrease more than women when they switch to a part-time schedule for a year.
> "It seems that men in the legal profession who take on non-traditional gender roles (i.e., taking responsibility for child care) pay a high price for that behavior," Noonan and her study co-authors write.
> If the workplace penalizes men more than women for taking breaks from work, then it could be the wiser financial decision for a mother to take on more caregiving activities — the decision that society overwhelmingly expects.
> And even before having children, just the act of becoming pregnant will mean more doctor appointments and actually delivering a baby — all things harder to do in jobs with rigid schedules.
> There are some arguments that women have lower salaries because they don’t negotiate salaries as well or aren’t as naturally competitive
> Studies do find that women negotiate their salaries less frequently than men — but also that they may choose to do so with good reason. One series of experiments found that managers were less interested to work with women who asked for higher salaries in job negotiations.
> The data tells us that this can’t be the entire story. It can't explain why the wage gap is so much bigger for those with kids than those without. One 2015 study found that childless, unmarried women earn 96 cents for every dollar a man earns. Remember that study we started with, the one about the MBA graduates? It showed that women with kids had a wage gap twice as large as women without.
> "There are really three groups: men, women with children, and women without children," says Bertrand, who worked on that research with Goldin. "Things like negotiating skill might matter on the margin, but it is not the core issue."
> If the problem were that women aren't competitive, it couldn't address why the wage gap is smallest when women are youngest. It's not as if women would lose their negotiating skills over time.
This situation is only happening because of bubble cash and a lot of inexperienced leadership with too much money on their hands.
Once the bubble pops you will see all of these people with a resumes full of 6-12 month stints and outrageous salary expectations working at Starbucks (if they are lucky) and everyone who puts in years for reasonable salaries still employed at profitable companies.
Enjoy it while it lasts.
Long term employment is very important to increasing productivity as a software engineer. The first 6 months is just learning existing systems, so from 6 months to 12 months doubling productivity is normal.
As you work longer you build more infrastructure that supports future productivity gains so from 12 months to 24 months you should be able to double your productivity again.
After 24 months your productivity is so much higher than newer employees that you can continually invest time in developing tools and infrastructure to enhance your productivity so your productivity continues to grow.
When there is a recession there will be unemployment for software engineers so a certain percentage will not be able to find work.
These job hoppers are the lowest skilled since they have never learned how to develop their productivity over the long term and they will be demanding the highest salaries based on their past experience so they are the least likely to be employed.