Salary Negotiation | Hacker News Reader

Salary Negotiation

kalzumeus.com

609 pointsgk1410 comments

I've heard this "don't name a number first" advice so many times, but personally, it never seems to work. My current comp is significantly higher compared to others with my level of experience. So when I refuse to give a number, the recruiter ends up guessing a number that is significantly lower, and making a lowball offer. I've also had many other experiences where after many hours of interviews, I find out that the company is unable to make me a competitive offer, because my current comp is too high. I'm seriously considering abandoning this advice in future, and simply just naming my comp expectations right at the start.

The point of the advice seems to be that you might get lucky and they'll name a higher price, so if you happen to know that they won't you have more information than they do and can set the anchor point appropriately I suppose. I'm not going to claim I'm some kind of master negotiator though.

Perhaps try turning it on its head. Ask the interviewer what their salary range is, before they ask you.

This sounds like some naive advice. Almost always salary range is discussed through a recruiter. This likely will be fruitless and will make you look like an amateur.

Adding to linkregister's reply. Unless it's the hiring manager, the interviewer likely doesn't have access to that information.

The interviews are to judge skill and if everyone wants to work with one another. There are also different leveling with the title, so they won't know the range until all the interviews are finished. And while money is important, it comes off as you're only interested in the money to the interviewer.

Your statement also says interviewer instead of recruiter, was that a mistake? I have never had an interviewer discussing salary range, maybe cost of living in the area, but not salary range for the role.

If the offer comes in way too low, you can choose at that point to give your current salary. If you gave the current salary in beginning, you can't take back that bit of information.

This would work fine except you may not have a ton of time to waste. The problem is, in practice, as someone with an outlier comp, you may end up having to go interview at a company only to realize at the end of the whole interview dance when they cough up a number that such number is nowhere close to your expectations.

(That said, I completely agree that it is generally good advice to not disclose your salary expectations in most cases. This is especially true for junior hackers without full awareness of the market conditions, who I have seen consistently underestimate their salary potential.)

As another poster noted, the best way to resolve this is to ask the recruiter up front what the salary range at play is. If they still won't disclose, you have to make a calculated risk based on how much you like the org and how much they seem likely to offer.

Yes, and many savvy recruiters would make you make the calculated risk anyway. Note that at that stage, the recruiters are highly incentivized to say or allude to "we can beat everyone/are competitive" without saying a number and make you interview with the company at the beginning of the process (with various excuses, including not having the authority to talk about actual numbers and that decision being prorogued to a distinct person/team, but rest assured that we beat others according to your interview performance) and you later learn their guesstimate was far off.

The solution to this is easy: don't bother with that uncooperative recruiter. Remember, we're talking about trying to jump from one high paying job to a higher paying job here, so why bother with uncooperative recruiters? They need you much worse than you need them.

I agree. Following that recipe, you decide on ending the phone call with a nice, but uncooperative about blurting out a number recruiter who claims they can be competitive.

Now the question is this: if you are willing to blow off the whole process anyway on that call, why not at least try giving them a number and give them a chance and see if they would beat it?

> why not at least try giving them a number and give them a chance and see if they would beat it?

If it's obvious that the recruiter is uncooperative or that the role isn't prestigious/top-tier, this is exactly what one should do.

The reaction to blowout numbers may just surprise you, and perhaps not for the better..

In my life I've been more upset by a lack of resistance in negotiations (of any kind) than immediate supplication, because it invariably means: "I could've done better, my appraisal was wrong"

Sure, if you want to interview for the position so badly, name some arbitrary high number. But Patrick's original point is that you should never disclose your current salary or the number you're truly willing to settle for, since it sets a premature upper ceiling on what you could end up making.

> many savvy recruiters

Again we must discern between "internal recruiters" and recruiting agencies.

Reputable third-party recruiting agencies will not play this game:

  - They know their clients.

  - They know how prior placements have been compensated.

  - They only get paid if you get placed.

  - They have 10 other companies they might be able place you at with higher likelihood.

"Internal recruiters" should be seen as any other adversarial negotiator: hopefully in a weaker position.

"I've got 3 other offers on the table right now, my time is extremely limited. I am sure you can understand: I cannot afford to waste time on unsuitable roles. What is the top-end of your range for this position?"

And really, you need to know what you are worth, or this number is meaningless. Once they've dropped the top-end of the range, you can give an ultimatum: "Match and exceed companies A, B, C." or "I would be willing to take a risk and go down this interview track, but understand from the onset: your top-end is at least $xx,xxx lower than I would consider. Furthermore, I do not wish to be the most well-compensated employee on my team, which might detract from my desire to proceed."

You would have to waste a lot of time for it not to be worth it. Lets say through your entire interview process at multiple companies, it adds an extra 10 hours. If that gets you $10k a year (or more) over 5 years, I am pretty sure that is worth it.

You need to multiply that with the probability of the companies not beating your current salary. The higher your current salary, this probability will go higher, and your interview cost will too. In effect, interviewing not being worth your time is proportional to your salary squared--not a linear relation.

Yeah, but once you get established enough (which you probably are if your salary is really high), then 95% of interviewing is you looking at the work they are doing and deciding if you want to do it, and salary negotiation. When you are good, the filtering on your part should come way before interviewing.

"Yeah, but once you get established enough (which you probably are if your salary is really high), then 95% of interviewing is you looking at the work they are doing and deciding if you want to do it, and salary negotiation. "

Ideally, but not always practically, especially as a software developer.

A large complicating factor of the whole "when to start talking about required salary numbers" is the fact that in computer software development no matter how established you are you are still often expected to do some ridiculous multi-day dance of interviewing to separately prove to n number of people that you can actually string code together (even if there's already ample evidence to prove you can, such as successfully shipped applications at prior jobs, repos full of open source code written, etc).

Interviewing for software jobs is (still) just incredibly broken in ways that make waiting to talk about salary until a later time a very dangerous game.

The last interview process I went through was three weeks and four separate meetings (1 long email, 1 online test, 1 phone interview, and 1 in-person interview). All in all, it was about 9 hours of dealing with them, plus a 2 hour round trip to their office and having to take a half day at my current job. They never asked about salary expectations and I never gave any (a mistake on my part, I believe) and when they finally made an offer, it came in a full 25% under my current salary (which is what I had been looking for). Asking around, a few other devs received similar offers that they turned down from that company.

I feel that I could have saved myself the majority of those 9 hours if I had told them my salary expectations from the beginning. They would have either balked immediately or told me the position wasn't going to be paid that and we would have been done. I think that is how I will handle things going forward, personally.

> I feel that I could have saved myself the majority of those 9 hours if I had told them my salary expectations from the beginning

Or you could've asked their range upfront, and then you could be the one disqualifying and doing the balking. This information is freely given to third-party recruiting agencies (if they use them) as well.

For me, this serves more purposes than knowing what I'll get paid. I need to know that my coworkers are well-compensated: it's a huge indicator of the quality of team you'll be working with.

Sure, it's possible that the entire team is grossly overpaid, though it's not likely. You'll find out their competency in the interview loop.

> Or you could've asked their range upfront

LOLOL You'll get

"we pay market rate"

which is a ONE HUNDRED THOUSAND DOLLAR WIDE gulf of market inefficiency

I'm in a similar boat - and definitely not naming a number first has caused friction when the initial offer ends up coming in way below my existing comp.

But I'm sticking with the strategy.

Ultimately the jobs where, in a vacuum and asked to value the job themselves, they come up with a number a sad fraction of your current comp, there was simply no scenario in which you would have been happy with comp at that place. It is simply the wrong job/company, and a change in negotiating tactic would not have fixed it.

The lowball initial offer ruffles some feathers and produces bad feelings, but ultimately does not change the outcome of the game.

Where withholding your current comp matters is where you're looking to make a step up - either a position with more seniority/responsibility, or simply at a company that pays people more. In these cases you have some knowledge that the upper end of the envelope is higher than your current comp, and so you don't want to anchor the negotiation low right off the bat.

Knowledge of how much companies pay for what positions is invaluable in negotiation - personally I wouldn't even bother interviewing at places where I know for certain the comp won't hit my expectations.

Side note: Glassdoor is incredibly bad for this kind of intelligence. Their medians lean low and the upper end of the envelope is in my experience almost entirely unrepresented. If you go in assuming the comp envelope is what Glassdoor says it is, you will lowball yourself severely.

>personally I wouldn't even bother interviewing at places where I know for certain the comp won't hit my expectations

Why would anyone do that?

I dunno, yet people do.

More commonly though I think people just aren't aware of the market situation, and comp ranges for specific jobs at specific companies.

Knowing the lay of the compensation land in your area is pretty critical to negotiating well - from both sides of the table. And this goes beyond generalities like "market salary" but to specific recent offers made for specific jobs at specific companies.

> I dunno, yet people do.

Honing the skill to determine whether or not a company is going to be able to pay you what you're worth is hinged on a few (apparently tricky) soft-skill-based assumptions:

- You can assess the company (quality, tier of engineer, etc.)

- You can assess your own market value, apparent worth accurately.

I like to give companies that I believe won't pay correctly the benefit of the doubt: I give a blowout number, xx% more than I believe I am worth. If I'm not met with resistance: I'm wrong and it hurts.

some people want interview practice for instance, or if they think that they can talk them up to their desired salary once the interviewer sees how good they are and have time invested into the process.

And it is sometimes worth interviewing with a company that sounds interesting. One can't predict how an interview will go beforehand. I've been pleasantly surprised by some interviews that I had expected would be completely uninteresting.

> Side note: Glassdoor is incredibly bad for this kind of intelligence. Their medians lean low and the upper end of the envelope is in my experience almost entirely unrepresented. If you go in assuming the comp envelope is what Glassdoor says it is, you will lowball yourself severely.

I concur wholeheartedly. Glassdoor is the absolute worst representation of salary ranges available. One could speculate as to why, but anecdotally, I've never received an offer that fell below their "reported" top-end.

AngelList is similarly bad for top-end comp representation, with the added twist of permanent anchoring: if you apply to a company that's listed an unreasonably low salary range, even if you know they'll (logically have to) pay more, they'll know that you can be bought cheap.

I think this advice works best for people with esteem issues. If you constantly undervalue your worth then of course other people tend to offer more than your initial amount.

The way I see it is that it boils down to: how likely will the employer greatly surpass your asking price? If the likelihood is low, you should lead. If the likelihood is high, then you should let them lead.

In my opinion, with negotiations, (as much as people hate negotiations in this thread) nothing ever generically applies as not all people are expert negotiators... (including this advice I guess...)

I agree with you. I see this advice constantly parroted about, but I just cringe at the amount of work these people go through to avoid naming a number. If you want to deflect the first time the question is asked, fine. But if you have to deflect more than once, you won't come off like a professional. A professional knows their value. If you follow all of the rest of the advice, like doing your research, you'll know what you are worth and it shouldn't be a problem naming a fair price.

The other point I have is that the first number isn't all that important. Yes, it might anchor the starting point, but you'll be in a stronger negotiating position when the written offer is actually made.

I just went through this recently. Yes, their hiring manager asked me what my requirement was for a salary and I gave them a number without any fuss. In their first formal offer, they gave me the number I wanted; however, by that point in the hiring process, it was clear that I was a top candidate, and with other competing offers, I was able to get them to come up another 30%.

In the end, I don't think the best approach is to force the company to make the first offer. They aren't going to give their best offer if you force them to make the first move. The only time that strategy might make sense is if your best number is much lower than their worst number; in that case, you did a lousy job in the research phase and need to take a step back.

A person with some fixed 'value' X can be worth much higher to one company than some other company. In fact that is extremely common. Value is relative here so I completely disagree with your "a professional knows their value" sentiment.

I don't understand your argument. I never said any value is fixed. Of course a person's value changes from role to role and from company to company. Part of doing your research is understanding the pain points for the company and the value you bring by fixing those pain points.

If you disagree with "a professional knows their value," what are you arguing? That "a professional doesn't know their value?"

I think they're arguing that you can't really be sure how valuable you are to a company since there's a significant amount of information disparity. Given your typical company that doesn't discuss much about internal issues or pain points publicly how do you do that research needed to understand those things?

Fair point--you have no idea what happens behind closed doors and what the available budgets are. And you never will. Perhaps the hiring manager decided they are willing to pay 2x the market rate because their pain is quite high. But how likely is it, due to your refusal to name a number, that the company is going to reveal the top of their range? So, yes, there is an information disparity.

But I still think that refusing to name a number shouldn't be the number one point in all of these discussions and blog posts about salary negotiation. You're right, when there are huge amounts of information disparity, either because a company's pain point is significantly higher than market rates would imply, or because a candidate has a rare and unique skill that cannot be easily found, then all of the entry-level negotiating tactics go out the window. But for fair-market jobs and candidates, I think you should be able to know your value well and refusing to name a number is a waste of time and energy.

> But how likely is it, due to your refusal to name a number, that the company is going to reveal the top of their range?

Well, in the podcast, he mentions that this one action is part of a larger strategy. The goal of it isn't to get the company to reveal the cap, but to defer the question until you've demonstrated high value to them, see where they start, and try to find their cap from there.

> If you disagree with "a professional knows their value," what are you arguing? That "a professional doesn't know their value?"

A professional might know their value abstractly or concretely to some companies, but in general value is relative to the company's needs, funding, and priorities. The recruiter has too many data points that you don't have to argue that going in with a fixed number is wise.

I actually would suggest that, in many (most?) situations, someone may not know their value, and that's not a negative reflection on their professionalism. You can do all the research you want, but there are many situations where you can't discover enough of the company's pain points or match your skill set(s) to their needs to figure out what you are worth to them.

And even if you can do all that, there's no reason why the dollar value you put on your worth to them has to be similar to the dollar value they have in mind. You could argue, in that situation, that you may not want to work for a company that doesn't value you "properly", but I hesitate to believe that there's always (or even often) an objective version of "properly" that disinterested observers could agree on.

Having said all that, I am still not sure I buy into the idea that the best negotiation tactic is to evade (even "professionally") providing a number.

> with other competing offers

The key phrase here.

Always try to get multiple offers! If you can, you're in a much, much stronger position.

I tend to agree with you as well. I think in a market where a given role is undervalued, you might get a better salary by "fishing" a little bit and letting the company guess. But software engineering is a highly valued profession and employers aren't likely to shortchange a good engineer. IMO playing these games can just seem unprofessional.

You're best off naming a range, with a stretch goal, and giving a little bit of context to the person asking. E.g., "I'm looking for $150-180k, but I'm interviewing with a few other companies, so anything in addition to that would really put this role at the top of my list. I'd really love to work for you, so I hope we can find something that works for the both of us."

Notice how there's an implied "+ $X" in there. That X-factor can make all the difference and with this approach you don't come off looking like someone who's just playing games.

Biggest problem I have is base salary vs overall 'salary'. Recruiters always ask what salary I'm looking for.

How does one answer that, when you consider benefits, 401k, average bonus, etc. It could be $10k difference. So, I usually say I need to see the whole package they are offering to get you a number.

Be clear: "I am looking for a competitive package that includes base, bonus, equity, 401(k), and benefits." Then either: "I am looking for total comp package of $XX." or "I am looking for a base salary of $YY."

Never communicate or discuss a dollar amount without suffixing it with "base."

All of those other perks are either known, standard, or negotiable after the fact.

In general - save for a publicly traded company issuing RSUs - base salary is the most important factor to be optimizing for.

In my mind not naming your number first is advise given only if you are trying to maximize the negotiation. And even then it is quite debatable.

I view it instead that I am offering a service. I am well aware of what my service is worth, what my financial needs are and what amount would make me feel satisfied with what I am being paid. So I tell them that number.

I also tell them that the number is only negotiable in the sense of benefit trade-offs. I have built into my "price tag" such things as medical payments, etc. If they can offset some of those from salary to benefits that does not bother me. In the end my needs are met and I am happy.

I refuse to see the relationship with an employer as adversarial. It is a business relationship, I treat it as such and demand they do as well. Otherwise I don't do business with them.

Very well said. I don't find it necessary to maximized my result in a negotiation. I'd like to feel that I did well, but maxing out is not necessary. I've done very well for myself with this strategy so it really can work. I've seen the "refuse to say a number" tactic fail for candidates in the past. I distinctly remember hearing a manager on the phone with an agency recruiter saying that he wasn't going to interview someone if they wouldn't disclose their current comp.

And that manager is not someone good to work for

> I am well aware of what my service is worth

This is the first and most important thing to understand and know before entering a negotiation.

Without this fact, your negotiating ability is irrelevant (and kind of inherently non-existent), as you're operating blind.

With that being said: many do not know what they are worth, to their dismay.

> I refuse to see the relationship with an employer as adversarial

I frame as such: You're two businesses/professionals trying to reach a meeting of the minds. You both want the same thing.

I think it depends on what type of person the company is looking for. If they are looking for a leader then they will respect you more if you bargain hard and maximize your worth. If they're looking for an agreeable doormat, then they will like you more for compromising on your worth. I've found that management likes rank and file engineers to be doormats, easily compromising and agreeable. Imagine if they have to work hard at the bargaining table, they're also going to work hard trying to get you to work long hours and weekends.

Do you want to be treated like a doormat? If not, try again somewhere else.

Exactly my point. Don't set the precedent at the bargaining table.

I can't think of a regular scenario where it would ever be positive to be in the doormat position.

In my experience, companies you actually want to work for will turn away the doormats.

I've actually spoken to a number of companies that have openly stated that they would not interview candidates that didn't request an amount greater than a certain dollar threshold (most recent one I can think of was >$160k base, Santa Monica).

This is the "we want skilled, assertive people" ideology taken to its conclusion.

they have to work hard at the bargaining table, they're also going to work hard trying to get you to work long hours and weekends

Good! My evenings and weekends are valuable to me and I want to work with people who value my time.

If they self-filter because they're a bad place to work, all the better.

I just don't see the correlation, though. Your aptitude for being an engineering/technical leader need not be at all tied to your skill at negotiation. Those two things are very different skills. A place like HN should know that very well, as we often talk about the difference between soft skills and technical skills.

Personally I'm not a hard negotiator (though I'm willing to walk away if my -- generally not super aggressive -- number isn't met), but I tend to move myself into technical leadership positions fairly quickly when joining a new org.

Everyone is talking about this but no one is saying it: how much are your services worth in general? Would you share? Anyone is welcome to answer, not just Tactic.

I'm just curious.

I'll go first. I know developers that make 70 a year and some that make 120. It does depend where you live of course, but for me personally I need 90K minimum or I won't consider any gig, anywhere. If I can't get that, I go into subsistence living, doing odd jobs or finding a gig at McDonalds. But I won't lower my standards for dev services.

While 90 is a minimum, 95-110 is what I want. Depending on the role. If I were more senior, I'd want 120+.

Myself I'm worth about $120k given my experience, the market I'm in and what is standard for benefits in my area. (Minneapolis/St. Paul) And I have had no issue with that.

The key to me on top of that is that I am satisfied with that salary. It is not one that would make me look elsewhere with any urgency. Yes, I could try to negotiate more, but I feel no need to and believe that if I got more the company would be paying over market value and eventually realize and act upon that.

It sounds to me like you would be comfortable making around $100k and that if the market bears that for your services that is what you should demand. If the market doesn't support that for you, look at raising skills/experience until it does.

The odd thing is how much more you make by switching jobs versus a salary raise at companies. I am typically offered a 3%-5% raise but have typically increased my pay by 10%-20% by looking elsewhere. Companies really should assess the market more often.

Just to add another datapoint, I'm also in MSP, and I'd say ~120k is where I'd value myself as well, though I ended up taking less than that for my current gig because I wanted to work with Erlang (amongst other things), and it was an opportunity to do so. I'd +1 everything you said.

You're probably more senior than me, I figured 120 is about what a senior level employee would be worth. Generally speaking of course. Big difference for example, between expert Python dev and expert C++ dev writing display drivers or graphics engines.

I don't know exactly what I'm "worth" so that's why I like to ask around. I base what I'm worth off more the going-rate than I do me being a touch below or touch above the average employee. I'm not confident enough to demand 120 yet, but 120-180 is what I'd ask once I'm dominating interviews and able to pretty much make everyone else look like a fool.

I've found the same things on all your points. If anyone else wants to add in more salary datapoints please do so. Don't be ashamed of lower salaries, I have friends who work for 70K a year as C# devs and know full well they can make more. They choose to stay because they're comfortable. That's worth a lot too.

I make 90K now, but I work from home and am very comfortable. I know I can get 100K if I switch jobs and start going into an office again. It's not but may once I find the right place to land.

Location plays a very large part in this matter.

If you got more specific and said "Django expert" or could sell yourself as such, I would think $140-160k base or more in SF would be totally achievable.

But again, it's very difficult to discuss productivity and skill levels in generalities.

It's also very difficult to discuss the variations in market wages across cities: Southern California in my experience punches even higher than the Bay Area. Adjusting for actual cost of living and taxes, actual take-home pay in Washington and Colorado often greatly exceeds the Bay Area.

My market is probably more middle of the road for major economic areas, Chicago and Austin. Django is actually what I'm working towards specializing in.

I make $125 cash comp as a manager. Full stack engineers under me typically make $100-120, more dependent on negotiating skills than experience. Fully remote work environment.

"Big difference for example, between expert Python dev and expert C++ dev writing display drivers or graphics engines."

I'd encourage you not to sell your earning potential short by negotiating against yourself like this. C++ display driver writers sound more impressive and might be in shorter supply, but so are the companies that need them. Even if it's legitimately harder!

There are a lot of companies who bring in a lot of revenue off of web-stack stuff that need Python devs, and so are in a position where it makes sense for them to pay a lot for that skill set, and that's where the value side comes from.

I've turned down $350k for frontend work before around the Valley (2.5 years of experience at the time) - I have a unique master-level specialty in Angular.js (contributor, major involvement in the open source community including maintainer status in 2 of the 3 most used third party libraries in the ecosystem).

I've not seen anywhere close to that number since (I opted for a $160k position in an industry I like, expanded experience, and the ability to work even as low as 30 hours a week should I choose to), but it has given me supreme confidence to turn down offers that don't have a minimum compensation along with my desired benefits/perks.

> I refuse to see the relationship with an employer as adversarial. It is a business relationship, I treat it as such and demand they do as well. Otherwise I don't do business with them.

Negotiating doesn't have to be adversarial. There are multiple strategies you could take to boost yourself without being adversarial.

The problem is that advice you read on Internet is geared toward the average person, not you. It's true that the #1 mistake people make is to sell themselves short by giving away a (low) salary upfront. So it makes sense for the Internet to emphasize that advice: it helps the most people and therefore has the most impact. On average.

Why can't "the Internet" know that I'm not average? Based on my web browsing history alone, the Internet should know that I have reached expert level in resume and salary compensation discussions. So don't show me the stuff for beginners.

There has to be some startup idea in there somewhere. All the raw data is there. Deep learning is hot. Who will come up with the first usable "Internet persona" or "Custom Internet" concept that actually works?

>It's true that the #1 mistake people make is to sell themselves short by giving away a (low) salary upfront.

As an agency/3rd party recruiter/headhunter who asks people questions about salary all the time (current or desired), I'd argue that the #1 mistake people make is saying that they are willing to negotiate before getting any objection. I've written about this at length, but the typical conversation goes like this.

ME: "How much are you looking to make?"

CANDIDATE: "I'm looking for 100K."

ME: PAUSES TO TAKE NOTE

CANDIDATE: "...But I'm always willing to negotiate"

I haven't even said "no" and they are already negotiating against themselves. Any hiring manager dealing with junior level candidates will likely know this tendency for inexperienced negotiators to mention flexibility when greeted with any silence, so they'll incorporate that silence into their "script".

I am a recruiter and I will tell you this: you should abandon this advice, for certain.

It's funny - probably the best advice anyone ever gives on negotiation is exactly the opposite of "don't name a number first." It's "anchor high." You should be anchoring to a number that is high but realistic, and negotiating from a position of strength. This is especially true for senior- and late-career individuals who have some experience under their belt.

"Don't name a number first" is advice that really only pays dividends to those who don't know their worth.

Those who do know their relative worth are already playing a different game than the former, and will probably be able to reap more advancement and value than someone "getting lucky" by having a company mess up and issue a highball offer.

When entering a negotiation, you should know your worth and be able to articulate your reasoning behind it.

In my experience, it's much easier for me to articulate how I am going to create value and justify my compensation than it is for the counter party to justify their beliefs I am not worth what I say I am.

Usually, if diplomacy fails, it's because the entire team is anchored at a comp range that I would never consider. In that event, though, the counter party has done me a valuable favor: I do not want to work with individuals who are paid less than me.

Your worth does not necessarily equal what value a company places on a given role they are trying to place you for.

Correct! But this is exactly the definition of "fit."

When I was speaking about "worth" before, naturally one must scope their estimation to the market they're trying to sell to. Market worth is only what the market is willing to pay for something.

If you've got a broad, valuable skillset, but a company can only use 10% of it, they can rightfully scope the role and issue an offer or decline to issue an offer.

What isn't okay, though, is taking the scoped offer and then performing in a far wider capacity - that is the very essence of being undervalued and/or underpaid.

Is it?

I've always looked at fit more from company culture, team dynamic, overall team skill level (A players, B players, etc.) vs. something that's directly associated with a certain compensation package.

Refining: it's a mutual combination of factors, but relative compensation is certainly a strong proxy for some of those factors (skill level, in particular).

> You should be anchoring to a number that is high but realistic, and negotiating from a position of strength.

I very much agree with you and my other comments in this thread are very much advocating for this position. I'd just like to add an important caveat by saying anecdotally in multiple occasions I've seen friends (notably people who are just moving in to the Valley from elsewhere and/or right out of college) tend to widely underestimate the "realistic" estimation in your advice (they know in abstract that salaries are "high" but don't necessarily concretely know how high), and therefore following it can be dangerous and would mean lowballing themselves. Hence, not saying anything might result in a better net result end of the day.

Want to name some numbers? Ideally with context.

I'd like to know how high is high in SV. Especially for junior positions.

24 y.o college grad software engineer at "Big Tech" company in the valley.

Started at 107.5k with promotion and raise to 120k

I'd say if you're in SV, have a pretty good background, interview at top-paying public firms like Google/Facebook, get good scores, and negotiate very well, you can expect around

  - new grad: ~175k
  - 4 years: ~300k
  - 6 years: ~350k

Note that I'm including equity, expected cash bonuses, 401k matching, and sign-on bonuses (which I normally divide by 4, since 4 years seems like a typical period to stay at these companies).

the 4/6 year ones are way too high unless you're going for some sort of specific role they need. like if you specialize in robotics or machine learning

The 4 year number is mostly from my own experience. I interviewed recently, and my highest offers (after significant negotiation) were

  ~316k from a public company
  290k~350k from a private company, depending on which valuation you use (409a vs preferred)

Again, this is including equity, expected cash bonuses, etc. I have 4~5 years experience and no unique skills.

The key is to get at least 2-3 offers around the same time, do a lot of research, and be mindful about what info you share when negotiating. When a recruiter asks about salary expectations, I think it's good to share a number, but it could be your current salary, a competing offer, or just a (substantially high) target number. And it could be base salary, or blended compensation. Share the bits of info which are most advantageous to you, and keep the rest private.

The new grad and 8 year numbers are from some info friends have shared with me, and some public info (like the spreadsheet that appeared on HN a while ago, and some info individuals have shared on Quora).

How did you value the options?

I didn't have any offers involving options. The ~316k offer involved public stock, and the 290k~350k offer involved private RSUs. 290k is using the company's 409a price and 350k is using their preferred share price.

Are these numbers before or after pitting competing companies against each other?

After; my first offer was substantially lower.

That 4-year number is roughly consistent with both the SRE offer I got recently at Google and the SWE offer a similarly-qualified friend got, and we have no super special domain knowledge.

Not directly related, but that comp ramp-up between years 1-4 and 4-6 seems similar to what I see at my current place, which is starting to cause some discontent and potential retention fun down the line, with people getting used to everything ramping up quickly initially and then slowing down once they get to a more mature level (and title changes get further apart too, since you're expected to do more and more at each role).

Interesting to see similar numbers from elsewhere.

you should divide by four here too.

First year, what would the person get? $195k, with $160k salary and 35k in stock?

I'd say this thread is not a bad first approximation for what you are asking for (but note that high side has a lot of variance and is very much context, person, and importantly, timing dependent and the uniquely highs are always underrepresented in these threads, almost by definition):

https://news.ycombinator.com/item?id=11314449

As a skilled junior person without having/being known for specific connections/expertise, probably the best generic advice, if your goal is purely optimizing for salary $$$ [and I wouldn't blame anyone for this, but I'd say there are many other factors to optimize for as well], is to get offers at various places, while making sure at least a couple bigcos are included, and play the standard negotiation game (they don't really negotiate with you; they negotiate with each other over you). Also, don't be afraid to jump ship early on when you get a better sense of the numbers you can command and avoid inertia. Inertia can be a big hinderance, especially very early on when a recent decision with much less data is made; a course correction might be essential.

P.S. people who make the real $$$s, don't do that by optimizing for a (risk-free) "salary" taken from an employer, so always keep that in mind.

Can you define inertia in this context? Does it mean the risk of staying stagnant in a lower paid position?

Yes. Too often, people stay at their jobs, simply because they don't even think about it. Leaving your job requires you to step outside of your routine and do something you don't regularly do. Conversely, staying your job simply requires you to stick to the same routine that you've been doing for years and years.

Don't allow your major life decisions to be made on auto-pilot. If you want to stay, then make a conscious decision and stay. If you haven't made such a conscious decision in years, it's time you had that conversation with yourself.

I'm a young Senior Engineer. I'm low on the tenure side, but I've run successful teams and have deep technical knowledge.

I say $220k total comp and that I will count equity but if it's not liquid it won't be worth much.

I base that off of what I would get at Google or Facebook (including equity).

I've asked around and most companies take it seriously.

For junior engineers, I would say $160k. For mid, $180k - $200k. Again, total comp. Equity counts but at my value, not theirs.

160k for junior and 220k for senior? Doesn't make any sense to me.

Do you mean that's not a big enough gap?

Yes. And also crazy starting salary for a junior.

160k isn't salary, it's total comp. A conservative Google new grad salary is going to be $110k + 35k in GSU/yr + 15K annual bonus (not including signing bonus). Many negotiate an extra 15-20k in GSU/yr.

220k is perhaps on the lower side for senior, maybe closer to 250k is on target. $140k at Google plus 90k in GSU/yr + 20k annual bonus. Could be much higher though.

It is also important to note that years 2,3,4 at Google are going to likely result in stock top ups and comp will skyrocket, but I was largely referring to starting salaries here.

Edit: Also, as mentioned I'm a young Senior. Google isn't likely going to bring me in at level 4.

Probably true. I'm actually in LA, and we experience this too. Honestly, the best thing you can do in salary negotiation (and in almost any negotiation, probably) is to gather as much data as you can to inform your position.

Similar jobs in similarly-funded companies at similar stages should yield a pretty strong dataset of numbers by which you can construct your own ask. Easier said than done, for sure, but if you can - gather data!

What do you by inform your position? Can you give an example of what to look for?

Well, recruiters are in the unique position of getting to talk to tens (or sometimes hundreds) of candidates a week for any given position, and asking them all a bit about salary usually yields a workable model for the market for any given role.

Some recruiters also have access to data from VCs or from other salary reports (there are a number of good institutions that run compensation surveys - access to these usually costs lots of money). Glassdoor is also a good source of data (sometimes) and PayScale is even better.

Do you have any other good sources? As a marketing guy who wears a lot of hats, it is hard to identify consistent titles that represent what I bring to the table, and PayScale didn't seem to be great, and Glassdoor was hit or miss (in large part due to geographic data despite living in the Bay Area where they should have lots of data).

There is serious information asymmetry between recruiters/employers vs employees, and if information is the best weapon, employees are woefully unequipped to fight that battle.

Glassdoor is okay for the UK at least, I use it to check the Software Developer and Solutions Architecture average wages nearby to were I live. The amount of data seems to be getting worse lately though, wonder if certain companies are asking for data to be removed.

Glassdoor's website states "Your trust is our top concern, so companies can't alter or remove reviews." so at least the reviews are genuine but of course, that does not mean some other data (salaries) are not being altered.

Especially helpfull for engineers, the salaries and titles of H1B visa holders is public

This is actually a dangerous source to draw conclusions from. Even ignoring the qualitative bias of H1-B workers having less leverage than an average worker with easy mobility which likely causes relative wage depression in that data set, the key issue is that a significant chunk of a high salary software engineer is in equity and it rarely shows up in the labor certificate application. So H1-B data is mostly base salary and can be misleading to use when drawing a conclusion on total comp. Extra care need to be taken.

Both good points. All of the data mentioned has its role. The key with H1B data is that the biases are better known. With self reported datasets, who knows what the poster's motivation is? Especially with companies that don't have many data points!

The risk to an employee is asking for too little and H1B data can help put of floor on that number.

Do recruiters ever provide this information to candidates for a fee? If I was in the market for a job it would be great to pay an experienced recruiter to objectively judge my skills and say how much I should ask.

Why would they charge? They get a placement fee based on a percentage of the starting salary. It's in their interest that the candidate gets the best deal possible.

They get their fee if you are placed. This puts them in a conflict of interest situation where if they can convince you that you are worth less than your true price you will be easier to place. Also the cheaper you are the less work they will have to do to get you placed in a new position.

You really only want advice from someone you are paying and who cannot benefit from under pricing you.

Buy recruiters at your current company a beer. If you keep in contact, especially once they've left, you can get all sorts of information.

It is good advice to treat recruiters with respect. All too often on HN I see an attitude of contempt shown towards recruiters (and HR in general).

That contempt is earned from a history of doing things that make articles like this one necessary.

I agree, but there is nothing to be gained personally from doing so. It is like being rude or contemptuous to your waiter.

The best thing you could do is to have two offers. In that case the companies bid for you on the perceived value you will provide them. And you turn the table. Btw - anecdotal evidence points that is a way to get a raise too - company Y is offering X,Z and C. Can you top it so I can stay here?

I would not recommend the raise strategy unless you have a very impersonal relationship with your manager OR you're 100% willing and able to walk (e.g. offer is in front of you and can be signed that day).

Managers are human beings too and don't like being put at gunpoint by their employees. It's very much the nuclear option IMO.

If I had good relationship with my manager, he would have offered a raise without me having to ask for it.

What is your leverage if you don't have competing offer?

Your willingness to quit.

I honestly never understood the notion of not naming a number first (that is if you know what you're worth). Take the number you want to make, add 15%, and they'll likely negotiate down to the actual number you want. It's really not that hard.

Take this as an example:

Say you currently make $80k and you want a 10% bump. So you're looking for $88k. Take that number and add 15%. Your ask is now around $100k. They may say something like "we actually start all new engineers off at a base salary of $85,000". This gives you a ton of power in negotiating just a $3k bump. If you had said you wanted $88k, that "starting salary" would have likely been $75k. Thus making it a pretty big leap to the $88k you wanted.

The rationale (which I don't agree with) is "what if their range is a lot higher than your guess? Then you're losing out!"

That's what things like Glassdoor are for

Glassdoor data is often not good indicator as you can filter by only recent reports. So some numbers can be older than 5 years.

Your example numbers show how you lastly underestimate what tech jobs pay, and you are inviting an employer to low ball and you won't even know

No, that would be a decent salary for early to mid career tech workers outside the bay area.

The numbers I used are salary only. Total comp negotiation is an entirely other animal.

Not everyone works at Google. The average salary of my team of about 25 software and Senior IT people is around $90k. Other compensation is about 40% of salary.

I avoid giving a number early on in conversations. Rather than naming a number, I like to 'seed' the conversation with talk about market rate, 'premium' on top of that, and similar phrases to move them in the right direction.

Establishing a position of strength can also mean other things like having the company and hiring manager invest as much time as they can in recruiting you; not hiring would be worse to them than over paying a little.

Also, having other offers on the table always helps negotiating better. Even if its never mentioned to the recruiter I just happen to negotiate better with the mindset that I have other options.

> Even if its never mentioned to the recruiter I just happen to negotiate better with the mindset that I have other options.

Playing the game like you've got nothing to lose is what breeds the best. This applies to a lot of subjects.

I generally tell a recruiter on the first phone call to tell me the salary range. If they refuse, I tell them I'm not interested. If they name a range that's low, I tell them what I'm looking for, and see if they're able to budge. If not, I tell them I'm not interested. Sometimes the range is higher than I'd initially expected and end up pleasantly surprised.

Either way, I don't talk numbers first and I still don't waste time with places that can't offer the sort of salary I'm after. I'm not going to even bother with a phone interview if I don't have a firm number in hand.

The problem is this forces everyone to know the market really well. That's one thing for a recruiter but as actual salaries are often hidden it's a serious information assemitry for most people. And many people especially women really undervalue their skills.

Most people are much better off to simply ask salary ranges as the first question for a recruiter. Don't put it off and don't waste any time. Approximate location should the next question as again it minimizes wasted effort.

Agreed. I recently switched jobs after an 8 year stint at my previous employer, and it took me many months and many recruiters and possible employers, and every single time I started from the position of "Let's not waste anybody's time, my total Cost-to-Company is xyz, benefits include zyx, if you can't beat that, then we have nothing to talk about." Yes, brutally honest, but it also at least doesn't waste anybody's time with useless phone interviews and reference checks and and and.

I suppose it's a good rule of thumb while figuring out the dynamics and the influence game of the negotiations.

The best thing I did for my negotiation skill was to read up popular psychology books on influence. It may not make me a negotiations pro but just being able to name some of the dynamics and recognize some of the tactics puts me (or so I feel) at a far better position at the discussions.

E.g. it's easier to play football if someone explains the rules, especially if the opposing team is used to playing against players whoa are completely clueless of the game.

In this context "don't name a number" is analogous to "be aware of the leverage at play, and don't yield leverage to the other side unless you know where the game is".

I would agree with your first statement "good for learning" if learning would be about maximing each result of a learning experience. But actually learning is more efficient if you do mistakes that you can evaluate and make decisions based on them. And if you don't say a number you don't make a mistake. Therefore I would say that not saying anything may increase your knowledge of your value but it doesn't increase your skill. Saying the wrong number, walking out happily and later learning from a coworker that you earn only 25% of him, then you learn something and look for another job.

That makes no sense to me. What does being underpaid teach you?

Nothing. But finding out how you ended up being underpaid does. The mistake was not getting a paycheck but the bargaining for the amount. The difference between what you should get and what you get is money you pay for your education.

There's also the concept of a negotiation anchor. In that it's better to name the first number and make it borderline ridiculous and in your favor. So that anything lower seems like a deal.

Hypothetical situation time. I'm a job seeker and my minimum acceptable salary is $100k. You're a recruiter and your range is $80-$120k. Neither of us know the others' number.

If I make you say a number first, you would start at the bottom of your range. (Why not?) Now I'm "negotiating up" to my minimum.

Alternatively, I go first and anchor at $150k. Now it's much more difficult to lowball me at $80k, and we'll probably "negotiate down" to your maximum.

The key with this technique is setting a good anchor. Too high (e.g., $200k) and you'll just walk away. Too low (e.g., $120k) and you'll whittle me down because you know you can negotiate.

-----

Bottom line is knowing what you're worth and quickly testing whether you're in the ballpark. If you go into interviews without having a sense of whether the company will give you a competitive offer, you're wasting everyone's time. (And you have a bad HR department.)

Don't use ranges: the employer will hear the lower number. Just say, "The market rate for this kind of role is $150k base. I'd look for a competitive overall comp package, and we can talk about salary, bonus, and equity. Is that what you had in mind?"

You'll get one of three answers:

1. "Yes, that's in range." (And you can probably negotiate up.)

2. "No, that's too high. We were thinking $x." (Now you know where you stand, and how far apart you are. <20% is negotiation. Note that if they don't give you $x, don't give another number: you're just negotiating against yourself.)

3. "Ehh, it's on the higher end, but I think we can make this work." (Might actually be #1, but otherwise means you're in the sweet spot.)

The first half of your post reduces to "know how much the prospective employer is willing to pay". Anchoring high only works if you know what "high" is. If the recruiter had a 150k-200k range in mind, and you throw out 150k, then you've just cheated yourself.

There's lots of advice in this thread to "know what you're worth", but where is that signal coming from?

Market research, competitive offers, friends... there are a lot of sources. If you don't have at least a sense, it doesn't matter what negotiation tactic you're using. Maxing out at $200k would just be a factor of luck or a mistake on the part of the company.

Anchoring is merely a technique: the first half of my post boils down to "it's ok to throw out the first number".

Here is a simple heuristic that's worked well for me: look at all of the job ads online for similar roles in the same city. Most will not name numbers. Find the highest listed number (top of range) in all of those ads and add 20%. That is a place where you will not be selling yourself short. You may not be maximizing your comp, but you will be above the average. Just understand this may disqualify you from jobs where they only pay below average. You need to be comfortable with being disqualified for high comp.

In addition to highest published umber + 20%, I would advise to carefully read any stated salaries on message boards like this when they come along and pay attention to the highest numbers. Then you will be aware of what is possible.

You might be able to compare salaries like that, but cross comparing equity is much more difficult.

yeah but equity * likely outcome is going to be comparable to a lottery ticket, not hard cash, unless you are 100% sure you can pick startup winners, and if you can why aren't you just into the funding market making 1000x than a developer per year?

You don't have to be 100% sure to be able to boost your odds.

One way to boost your odds towards picking a winner is to join in the employee ~15-25 spots. Early enough that equity is on the table, but late enough that some traction has been proven already to dampen your risk.

I've gotten a (4) response several times after interviews that went well in multiple regions - "Although you're well qualified, your experience and compensation are far more than we were expecting and we cannot proceed. Thank you for your time." I've asked different contacts before at most of them and my ask was within 15% and still way too much. Different companies have different tolerance for comfort even if they can get "top talent" for a good deal because they're so price sensitive.

I've had a negotiation where I found out that the company was only able to make $2.5k after paying me + overhead (contracting on predefined rates) after they led me on and gave me an offer that met my low number barely after bonuses with zero stock. I rejected multiple times and a VP even called me by the end. That should have been the sign to walk honestly. Evidently, some places have no negotiating power fundamentally because they have no intrinsically compelling work with substantially below market rates and with little means to negotiate up their value proposition to improve their circumstances.

Agreed. Setting both as a fixed part of your strategy is wrong. Always saying the first number or always waiting for the other one. The more information and leverage and options you have the more you want to say a number. And the other way around.

In a few weeks I will have a job interview but the job is only partly interesting to me. I can earn my money without that job, so I can say no. And the chances that I'm really interested are currently 45% yes to 55% no. In that situation I would either tell him "I'm not interested if you don't give me a high number" or I would tell him something I consider high myself. His starting number is certainly much lower than what I would consider my "yes" range.

I always name a high number. That seems to set the tone for the discussion and they don't even try the lowball offer.

I've had the opposite experience. I've avoided naming the number at least twice where the company then offered something higher than the range I had in mind.

Better, since I didn't start, I was able to still negotiate on top of their initial offer.

The first number is the anchor. If you can truly support an high number, then you should place the anchor high.

In a good negotiation, if you give an info you can expect an info back, so that's also your opportunity to request something. For instance you may want to ask how the bonus structure looks like, or what's their view on remote work.

And gain from there, negotiation is not just about money.

It's terrible advice as most companies are not likely in the range one is seeking and therefore are just a colossal waste of time. Seriously this article tells me to do three phone screens and one or two in person interviews before finding out the company is so far short of what I'm seeking that I won't take the job regardless of any other factors. Sometimes I wonder about people who write such advice and question whether they have actually gone through the job finding process while working another job, or worse, while watching one's emergency fund dwindle while unemployed. My experience suggests otherwise.

In cases like yours, it's wise to start by asking "Just to be clear, may I understand what's your budget for this position/role?"

Most recruiters immediately get the hint and you can gracefully exit if they're expecting to pay far below your current comp.

Edited answer to be less preachy.

We're really trying to nail a good way to deal with salary negotiations when onboarding people, at GrantTree - one that gets out of this "gotcha" approach to salary.

So far the best we've figured out is to be the first ones to name a number, and be super-transparent about how we arrived at that number.

The reasoning is that "in a salary negotiation the first person to quote a number loses", so since we (as the employer) are in a naturally stronger position, we deliberately "lose" upfront to avoid forcing the other person into a negotiation dynamic where they're going to try and push it as high as they can, and we end up trying to push it as low as we can. I think everyone loses out from this, and it starts the working relationship with distrust.

Instead, we run a pay evaluation process internally, including feedback about the value of the role and the person from all the people who interviewed the candidate. We publish all that feedback, as well as the suggestion/reasoning of our pay trustees (a group of people who use that feedback to try to place the candidate on our pay scale), along with the number this maps to, and the full pay scale, and the list of how much everyone is being paid in the company so they know where they stand (anonymised, because not everyone is comfortable yet with someone who is not yet a team member knowing their salary).

So far we've successfully used this process once and it led to a great onboarding experience. It's a recent development. I hope it continues to work, and allows us to avoid the games described in this very helpful podcast. I thought I'd share it in case other employers here are struggling with the same question.

This won't work in every company. Have a read through http://danieltenner.com/open-cultures/ if you want to understand more about how we run the company - hugely important in making this work.

None of those factors are why someone is worth $X salary.

You say I'm worth $X. I go get a job offer for $Y. If $Y > $X, you were mistaken.

It's both as easy and as hard as that, for candidates. If you want to get anywhere close to your earning potential, you'll have to have more than one option when job seeking.

It doesn't matter what you're paying other employees or whether that information is known to employees.

EDIT: To clarify, this is about market value, not intrinsic value.

No one is worth any intrinsic amount. The amount is relative to the work they do, the industry they're in, the state of the economy, how many other people can do that job, how many have actually applied, etc.

Any salary formula is entirely arbitrary. We have a pay scale simply because it is a useful tool for conversation, not because it represents any sort of intrinsic property of the person being placed on the pay scale.

If your main concern is getting paid as much as possible then we're probably not the right place for you to work anyway. We try to pay well but we certainly can't afford to pay as much as, for example, banking, or Facebook. Importantly, we have no interest in trying to sucker someone into working with us if money is their primary motivation. They won't like it here.

To answer a likely reflex-response to this: that doesn't mean we think people should be working for free, or that we judge people who want to earn more money. It's totally fine to want to make more money. Different people have different expectations and requirements at different stages of their life though.

> Importantly, we have no interest in trying to sucker someone into working with us if money is their primary motivation.

Are you a charity doing good work with orphans? Or are you a business trying to make as much money for the investors as possible? If the latter is true, why wouldn't someone work for you with "money as the primary motivator" ?

(This is not Rhetorical, I actually know nothing about your business. But I do see this argument a lot from companies that are 100% for profit and do nothing to better the world)

Neither. We're a purposeful, for-profit, founder-owned[1] company. Just because we are for-profit doesn't mean profit is our only motivation. It's a false dichotomy to suggest that because you want to make money that must be your only driver.

Our view of business is that, much like humans, it can achieve and balance multiple objectives. You want to make money: does that mean you want only that to the exclusion of or above other objectives like finding love, raising children, being a good person, etc? I assume not. We want to make money: does that mean we want only that to the exclusion of or above other objectives like having fulfilling work, working in an open organisation, being respectful of others, etc? No.

[1] Though opening up the shares to employees within the next couple of months... it's taken a while to put the right system in place. Options wouldn't work because we have no intention of ever selling the business.

Edit: Given your clarified question, I will also add that what we do is to help other tech businesses to raise government funding so they can develop cool tech. Many of them have raised money from investors - I don't think that necessarily means that their only purpose is money (though it's certainly true of some). See argument above.

I don't see why paying people less would lead to an improvement in love, family, being a good person, respect, transparency, etc -- unless you're saying that due to pay difference vs market, you'll also expect less work out of them.

And money is rarely the actual motivator. Often times, money is the mediator to the things that really motivate people, such as purchasing daycare and enrichment activities, splurging on medical care plans, financial security, etc.

> I don't see why paying people less would lead to an improvement in love, family, being a good person, respect, transparency, etc -- unless you're saying that due to pay difference vs market, you'll also expect less work out of them.

There's definitely no necessary causal link here. We aim to pay enough that they won't leave because it's too little but not so much that they will stay just because of the salary is too high. It's a pretty hard balance to achieve... not sure if we have. We used to phrase it as "pay people fairly" but then "fairness" is so relative as a concept that it is essentially useless.

Having transparent pay does have a clear link with creating a good working environment, in our experience, however - and transparent pay doesn't mix well with having salaries basically based on people's negotiation skills (rather than a more open system like I've described), in backroom deals.

> And money is rarely the actual motivator. Often times, money is the mediator to the things that really motivate people, such as purchasing daycare and enrichment activities, splurging on medical care plans, financial security, etc.

I wish that were always true... my observation is that some people are in fact motivated by the money, and the status that comes with being paid more than others, more than by the things they can actually do with the money. I find it puzzling, but so it is...

> not so much that they will stay just because of the salary is too high.

I can imagine a case in which a sufficiently high salary could lead to someone staying in a position for which they have no passion.

Still, like you say, it's a delicate balance, and on either side you of not getting good work out of your people. On the low end, you just wouldn't be able to secure high-value candidates. On the high end, you might keep people who have no interest in their roles.

I do think the latter case is less likely, though.

I can't find the study, but a South American government(I forgot which country) had the same fears. They wanted better employees and they were afraid if they paid them too much they would get people primarily interested in the money and not the job. But they decided to try it anyway, and lo and behold they were surprised to find the higher played employees were not only better employees but also more motivated intrinsically by the job. I would be curious to find any evidence to the contrary.

I try to be very suspicious when my views about how the world works line up with some way that I'm benefited monetarily. For instance it's very hard for me to have a clear and accurate opinion of oursourcing and h1-b's.

Practical example: my current employer pays me the same in base salary as my previous employer paid me in base salary + duty + overtime. Oh, and they do it without ever telling me I ough to work more.

For me this translates to happily walking the extra mile. It also means my wife is ok with me working a bit extra here and there because I love my job. And it means a whole less paperwork and talk about overtime or not.

I would float to you the idea that what you're reacting to is not necessarily the higher wage but the fact your new employer seems to trust you more and perhaps even care about you more.

Very possibly yes.

But it sure helps when telling my wife I should work a couple of extra hours.

> You say I'm worth $X. I go get a job offer for $Y. If $Y > $X, you were mistaken.

Here's the disconnect. In this scenario, I'm not saying, "you're worth X". I'm saying, "I'm willing to pay someone $x to do this job." If someone else is willing to pay you more for the same job (all else being equal), I'd advise you to take the other job.

If I can't find anyone qualified to take the job for $x within a reasonable period of time, then I'm below market and should adjust.

The beauty of that analysis is that it ties to current employee compensation as well. If my offers are below-market, then I have a much larger people problem: either my current team members are below market skills (bad) or are at risk of being poached (also bad).

As a candidate, I might look at that and value the culture it represents: transparency, fairness, likely diversity, people-centric...

The "we like people who care about more than money" (the passion gambit) can be a a giant warning sign. And is at the root of the "why would I accept less money from you than my market rate, so that you, the founder, can make more money" concern.

But it assumes that the owner, is in fact, making more profit "off your back". This might be false. The owner might instead care about investing back into people and the working environment: an indirect "perk", if you will.

Everything's a trade-off. No one is forcing you, as a candidate, to act against your best interests. There are just different kinds of interests.

Exactly. We know and recognise that pay scales are arbitrary. We are trying to get it right by neither underpaying nor overpaying. We are also trying to get it right by enabling a mature conversation on the topic, so instead of feeling undervalued and quitting after finding a better job, people within GrantTree can simply start some sort of process to get their pay adjusted to what they believe is a fair market value for their work. Alternatively, they might find out, through the process, that their work is not valued as much by others as they value it. This, if they are humble enough, is a signal that either they should be working on something else, or clarify to the rest of the company what the impact of their work is. Either way, this is an open process accessible to all, instead of something behind closed doors only available to those who are ballsy enough to ask for a pay raise.

It's far from perfect, and it's often difficult and demanding of people (particularly those who are on the various pay task forces that assemble and disband to make changes or evaluate people), but it's working alright so far for us. It's also a huge learning opportunity for everyone involved.

> But it assumes that the owner, is in fact, making more profit "off your back". This might be false. The owner might instead care about investing back into people and the working environment: an indirect "perk", if you will.

There is no good idea humanity has ever had that cannot be twisted into a trap to fool people... unfortunately every good thought ends up being used by someone somewhere to screw someone else over. I like to think we (my cofounder and I) are on the good side of that assumption, but it's important for us to remember that if we shift to the wrong side of it then the whole system becomes polluted by this desire - or rather, this fear of not having enough.

So why would I accept less money from you than my market rate, so that you, the founder, can make more money? At the end of the day there is 1 pie, why should I donate part of my pie to you?

Because the job is more interesting than the alternatives? Because there is room for major career growth? Because the work/life balance is better? There are tons of reasons it would be preferable to take a lower-paying job. Salary is by far not the only consideration (and for some, not even the most important one).

You would accept if:

- You're not broke

- You think the work would be more interesting/fulfilling than places that pay more.

Of course, I'm sure there's a tipping point where you don't care how interesting the work is. But in my mind you'd use the above criteria if someone is offering you $95k/yr when you're currently pulling $110k/yr.

Ok I accept that answer at face value.

Now, is the inverse also true? If I take a job with you- can I work 4 day work weeks and stick strictly to the 8 hour workday?

Money is not your only motivator so I don't see why this would be a problem for your employees.

We have two people who are on 4-day weeks. It depends on your role(s)... Some are less compatible with part time work.

They get same, equal salary then to the 5-day 40 hour people? Otherwise it would look like you're just profiteering as your main motivator.

Interesting. Why do you think that would be "profiteering as your main motivator" to have as a general principle that as you scale your work you also scale your salary? I'm not sure how that follows. It also seems to be the general principle in all the companies I'm aware of that support part time work, but perhaps there's something I'm missing. I'm all ears.

>Why do you think that would be "profiteering as your main motivator" to have as a general principle that as you scale your work you also scale your salary? I'm not sure how that follows.

I'm in 100% agreement with you. So you do pay less to those who work 4 days a week. That's fine and it makes sense. Just confirming.

Then I don't even need to ask: you're also saying that for every hour over 8 hours staff is paid overtime? That would be consistent with paying 4-day a week folks less. And would be the nail in the coffin that profiteering isn't your main motivator.

No, we don't pay overtime. There hasn't been a recent decision about that, so it's more a historical artefact at this point, but my rationale for not paying overtime (apart from the fact that it's uncommon to get overtime pay as a full time employee in the UK) is that I don't think overtime should be encouraged in any way. For the same reason we don't allow people to sell their (30 days) yearly paid holiday allowance back to the company - the days are there to take them, not to trade them for a bit of extra pay.

If I'm understanding your argument right, I think you're saying that because we try to evaluate how much people should be paid in a rational way that includes some assumptions around time being correlated to amount of work, that means we are "profiteering". I'm not sure that's worth dignifying with an answer, but here goes:

GrantTree is a business. We need to make a profit in order to continue to exist, to grow, to be an exciting place to work, to have the resources to invest in our people, to be able to develop new products, and so on. We also need to compete against other businesses in the same market, some of whom are quite aggressive. If we get the balance between people's contributions and their compensations wrong, we'll be uncompetitive and won't survive. It's that simple and has nothing to do with profiteering.

I commend the decision to not encourage overtime, and in the UK that probably doesn't take much pleading for you to achieve. I've lived and worked in France and worked closely with most nations around the world including the UK.

Ultimately from your description it sounds like the increased non-profiteering wages would not come out of company profits. Thus in the end it's just like all the other businesses then. No need for all the flowery language about how there's other priorities than making money. If you had to ditch everyone and go to Malaysia to "be competitive" then you'd do it.

If you are "for-profit, founder-owned" do you likewise plan to have a cap on how much you, the Founder, can make both in salary and equity/dividends/exit event like your employees?

I think the sentiment you are seeing here (not necessarily taking a side, just playing devils advocate) is that it might seem a little hypocritical to portray a culture where compensation caps (and ones that seem a little below market rate judging by other comments) are expected when there is no limit to the upside you as the founder might see down the line or from a potential exit down the road. Startups are inherently risky for employees, and while Founders certainly shouldered more of the risk, employees are typically rewarded with equity worth the risk, market rate salaries, or some combination. To not compensate employees in such a way seems like it might be taking advantage of a mindset when you the Founder might not be held to the same standards.

Again, if addressing this very issue is part of the opening up of the shares to employees you reference, awesome. This is a very hard problem to tackle and one where it must be damn near impossible to get everyone on board, so I commend you for making the attempt. I'm making lots of assumptions that I hope are simply not the case. Just wanted to clarify and push a bit more on why there seems to be a consistent theme to these comments.

Because getting to the point of being a successful business is a really long road, and going down it with someone whose primary motivation is to make money for themselves is going to make that trip way less fulfilling.

I assume everyone starting or working for a for-profit business is primarily (though not solely) motivated to make money for themselves. Otherwise, they wouldn't be starting or working at a for-profit business.

That assumption doesn't bear out in practice, in my experience. There are plenty of people who believe that for-profit businesses can also achieve great, positive purposes in the world, and want to be a part of it.

Cases in point: Tesla and SpaceX. They aren't charities. They are very purposeful.

Charity vs. for-profit is a false dichotomy. A charity is a specific form of non-profit. In addition, there is the (relatively new) benefit corporation which, while technically for-profit, has explicit non-financial goals.

That said, nothing about being motivated by money means you can't have a purpose as well. That's why I was careful to draw a distinction between "solely" and "primarily". Making money while also improving the world is just enlightened self-interest.

Tesla and SpaceX are both massive exceptions to the rule, not examples of the norm.

You are not Tesla or SpaceX.

And in fact if you want to write code that goes to space, you have 4 or 5 options top in the US? Vs many other business models (webapps for music) there may be 50 or 100.

> Cases in point: Tesla and SpaceX. They aren't charities. They are very purposeful.

Those are just two companies, ran by the same guy. I think finding even a couple dozen more examples would be very difficult.

Have a look at the companies listed halfway down the page on http://danieltenner.com/open-cultures/ . Not all qualify as purposeful orgs, but quite a few do. Reinventing Organisations, mentioned on this page too, is a book that studies a dozen examples of purposeful, open culture organisations, if you're interested in learning more about this.

Funnily enough, Elon has a reputation for paying below market.

> Are you a charity doing good work with orphans? Or are you

> a business trying to make as much money for the investors

> as possible? If the latter is true, why

> wouldn't someone work for you with "money as the primary motivator" ?

It is possible to offer a fair return on investment without having to take every possible step (ethical or otherwise) to maximize profitability.

Some would argue that developing a purposeful organisation (whose purpose is not just to make money) actually also produces better returns, but I think the jury's still out on that. There are some striking examples but they might be cases of survivor bias.

Seriously, if you can't afford a great employee, that's fine. But don't try to belittle someone because of your company's incompetence to pay. And don't stand on a morale high ground. It is disgusting.

> To answer a likely reflex-response to this: that doesn't mean we think people should be working for free, or that we judge people who want to earn more money. It's totally fine to want to make more money. Different people have different expectations and requirements at different stages of their life though.

No belittling intended.

Sounds reasonable.Was this added after I replied?

Nope. But don't beat yourself up over it! Missing a piece of a comment happens all the time. Hopefully you see there was no offence intended to people who have different views on this. I think it's totally fine that different people think differently about these topics, and I don't consider my view superior in a general sense. It just works better for me.

"If your main concern is getting paid as much as possible then we're probably not the right place for you to work anyway"

That kind of phrasing is generally code for, "We pay crap wages and expect you to live at work."

Generally, perhaps - not in our case. We pay what we (meaning, the staff, who decide their own pay) believe to be a good wage, and we have excellent work-life balance - we have a number of new parents who have commented that GrantTree has been a very supportive culture for them in the first 6-12 months (which are pretty hard apparently). And we have remote work, flexible working hours, etc.

> we have a number of new parents who have commented that GrantTree has been a very supportive culture for them in the first 6-12 months

"I was 20 minutes late because I had to take my newborn to the hospital and they only gave me a written warning!"

>And we have remote work

"On the fifth wednesday of every month I can work from home!"

>flexible working hours

"I worked from 9am to 10pm yesterday so I get to come in at 10am to 10pm today!"

GrantTree might be one of the few outliers here and if so I congratulate you, but this is typically what employers mean when they say those sort of things.

> "I was 20 minutes late because I had to take my newborn to the hospital and they only gave me a written warning!"

Or: since my child was born I've been able to be home by 5pm every day without any problems.

> "On the fifth wednesday of every month I can work from home!"

Or: one of our people is currently taking part in Remote Year. He's just spent the last few months in South America. http://remoteyear.com

> "I worked from 9am to 10pm yesterday so I get to come in at 10am to 10pm today!"

Or: we don't track working hours at all, and people often choose to work from home or do whatever makes sense given their circumstances. They work because they want to get their work done, not because someone's hovering over them with a finger ready to point at them.

> GrantTree might be one of the few outliers here and if so I congratulate you, but this is typically what employers mean when they say those sort of things.

Yes, it is quite sad that every good thought gets copied and corrupted. I can't do much about that.

Nice. Spoken like either 1. A trust fund kiddie with privileges to work for pleasure 2. An older person who purchased their family home before they started costing 3M$

Try again: 3. a couple of migrants from Romania and Poland with no starting wealth, living in a flat that we couldn't even afford to pay for (but my cofounder on the previous business, which bombed, basically let me stay in his flat on the promise that I'd pay when I had the cash) back when we started GrantTree. Add onto that that my parents fled Romania in 1980 with nothing and I was stateless until about age 12.

There are many, many people starting from far worse conditions, though, I'm not complaining. I had a stable childhood, a good education and I have great friends and parents and an amazing wife and cofounder. That's worth way more than any trust fund or inflated property.

>we have no interest in trying to sucker someone into working with us if money is their primary motivation.

If money is not your primary motivator, why can't you pay more?

Nice! This comment is spot on!

A company still has to have money in order to operate. I would assume that even without money being the primary focus, they have to be careful about paying out too much or they will be out of business.

Indeed. We are in a highly competitive market, and have a number of interesting projects going on to disrupt that market that won't pay off immediately. If we don't manage our costs reasonably well we won't stay in business.

Money is like rocket fuel. If you're accumulating it for its own sake, rather than to get somewhere, I'd say you're doing it wrong - but that's just my opinion...

The individual employee can say that too.

I'm in a highly competitive housing market, and my children are in a highly competitive educational market. A number of interesting projects that won't pay off immediately.

Since when is an individual expected to just defer to a greater good in an employment arrangement? Which is most likely "at-will"?

I'm certain the shareholders and executives aren't making such self-defeating sacrifices.

> Since when is an individual expected to just defer to a greater good in an employment arrangement? Which is most likely "at-will"?

1) You should never "defer to the greater good". I would not advise it. If this environment doesn't offer something of value to you definitely do not apply or join such an environment.

2) I completely agree that this approach is incompatible with the ultra-violent approaches to "at will employment" of the US and much of Europe. I find the process by which most people are fired in american companies abhorrent. I don't want to go into too much detail about what our current process is to deal with situations where there is a performance problem, but basically it involves engaging with the person and providing them with a lot of support to help them figure out what the problem is, and how they can fix it, and offering them a number of decision points about what they can do to fix it. Obviously, from a distrustful viewpoint this might seem even worse than a clean firing - and rightly so. This kind of stuff absolutely doesn't work in a distrustful, fear-driven environment.

> I'm certain the shareholders and executives aren't making such self-defeating sacrifices.

On what basis are you certain of this? Do you know something that I (cofounder) don't? I suspect that in the long term this approach will result in a more successful, longer lasting company that I feel even more proud of being a part of, so I don't think it's self-defeating in the long term - I disagree with doing anything self-defeating, I think no one appreciates it and it rarely results in anything good. But I don't know for sure that it will actually result in a better company. In the meantime, my cofounder and I could certainly have taken far more money out of the business and have not done so, so your assertion is incorrect in the short term (5 years) at least.

If you are not paying top of market wages, one or more of the following has to be true:

1. You don't believe top developers are intrinsically 'worth' the amount that FB/Goog/Amzn/ and many other SV companies pay, that it's not a net win for the company to have top talent.

2. You think that you don't need top developers, that really you're just going to be fine recruiting a bunch of B players, and it's some other 'thing' (business? Sales? Marketing? an 'idea'?) that will make you better than competition.

3. You are incapable of harnessing top development talent to produce adequate ROI that would justify top salaries.

Money is not my primary motivator, I love my job. I wouldn't leave just for more money. However, salaries in a certain ballpark are a strong signaler to how much a company values software engineers.

I think it's insulting to see developers significantly underpaid and have you attempt to justify it the way you do. If money is not your primary motivator, wouldn't you be OK taking a bit less salary and having that distributed out to other team members?

Most of our hires are not developers. We're not building cutting edge tech. We have some internal tools but I don't believe they require "top developers" by whatever metrics Facebook might use. That said, I think the few developers we have are exceptionally good - versatile, multi-skilled, quick learners, broad experience, the ability to conceive, manage and run a whole software project without very little help... and whatever they decide to develop, they do develop. As a developer myself, tech cofounder of my two previous startups, I rate them as excellent developers and would be happy to work with them on any project. One of them, with no academic credentials, is the smartest person I know.

Re: your second point, I don't believe in the concept of "B players". See http://danieltenner.com/2014/09/11/there-are-no-b-players/

I am sad that you see this as insulting. I'm not justifying anything. These developers (like others in the company) have largely chosen their own salaries. One of them is in the top pay bracket in the company. They also chose my salary, btw.

Where does it say GrantTree pays significantly less than market rate?

Note: I'm not the parent poster.

> 1. You don't believe top developers are intrinsically 'worth' the amount that FB/Goog/Amzn/ and many other SV companies pay, that it's not a net win for the company to have top talent.

You're conflating two things here.

I don't think that "top developers are intrinsically 'worth' the amount that [[..]] SV companies pay" (emphasis mine).

There is nothing intrinsic about a developer's value. A developer's value to their company is some proportion (<100%) of the value they add to the company.

Their value to FB is unrelated to their value to XYZ Corp.

> it's not a net win for the company to have top talent

That does not follow from a view on the intrinsic value of developers. I know that it is a net win to have top talent, but:

a) They might not be "worth" (to me) what FB etc will pay them.

b)I might not think that I have to compete on salary to get top talent. I may have a method of convincing talent to work here based on non-financial incentives.

>)I might not think that I have to compete on salary to get top talent. I may have a method of convincing talent to work here based on non-financial incentives.

Great point and I sort of side stepped that. It's not one not talked about enough. I didn't get a sense of that from the poster I replied to, but perhaps there is a compelling story there.

Money is the primary motivation to work. Would you be upset at an employee for working on their own project or for a different company during business hours? If you would not allow this then money is your primary motivation. You are giving money to the employee for ONE reason, you are buying their time to produce something of value for your company. Saying you aren't interested in people who are primarily motivated by money in a job comes across as disrespectful of the time of the employee.

As someone who once took a 50% pay cut to do do something I wanted to do (work in Japan) and another 25% pay cut many years later to work on a project I really wanted to work on I don't know if I can agree that money is the primary motivation to work. Maybe for you? Maybe even for most people? Although I don't think I know a single person who is working for money. If that's all they wanted they'd be doing jobs that pay more.

> Money is the primary motivation to work

For the overwhelming majority of people, the decisions about work are a balance of competing interests.

I could go out and get a part time job working on weekends, and make more (overall) money, but I don't because the money I make in 5 days is enough, and I place some value on my free time.

But the reverse it true, I could probably convince my employer to let me work 4 days a week for a 20% pay cut (or 0 days a week for a 100% pay cut), but that would drop my pay below the level I want/need in order to support my family and be able to do things on the weekends.

I could quit my current job and go back to working in finance for more money than I make now. I don't want to. I've done that, and I prefer the work I'm doing now, even if I'm paid 20% less.

I could quit my current job and go work for a charity and make 50% less than I do now. I don't want to take that sort of pay cut.

It's because of these balances that we have some well educated, highly employable people making a (relative) pittance as school teachers. And why some people spend their evenings doing open source "work" instead of taking on a second job.

Very few professionals in western countries have money as the single primary motivation to work. Once you can afford to pay your bills and maintain a comfortable lifestyle, you become quite willing to trade off the extra money to increase your overall enjoyment of life, whether that means more leisure time, or more interesting work, etc.

It is quite reasonable for for-profit companies to aim to provide a compelling work environment through factors other than pure financial reward.

It's also quite reasonable for workers to select job opportunities based entirely on the financial reward (though I think that's actually relatively rare).

That company and that worker are probably not a good fit for each other.

What percentage of the revenue derived from an employee's labor would he receive, in an ideal world? The correct answer to this is probably something between 30 and 70 percent, depending on a variety of factors. The real-world answer to this is "however little we can possibly share, because we want to hoard it all for ourselves", and personally I find that to be a distasteful reality (I find most investors' justifications for their wealth very hollow, they usually all boil back down to "well, I started with more money than them"). Employees have way undersold themselves; I think objectively, most professional employees would probably still be quite profitable to the company if their salaries were quadrupled. And to answer a likely-reflex response to this, yes, I have run companies with employees before.

Considering that founders are making themselves fabulously wealthy on the backs of their employees, I think we'd all appreciate a little bit more respect than you're showing when you poo-poo employees who want something more closely approximating 1/4 of the share they actually deserve.

I'm not fabulously wealthy, nor do I expect to get so from GrantTree. Yes, I am fairly well off at this point, able to buy (jointly with my wife) a small 2-bed flat in an ex-council flat in London - that's after spending 5.5 years starting a business that has raised over £35m of government funding for 600 UK startups and employs 27 people. If you think that's fabulous wealth, you have a different definition of it than I have. Yes, the business is technically worth a pile of cash (we're about to do a valuation for the purpose of issuing shares to employees so I don't know yet exactly how much), but we're not planning to sell the business so that can only be realised through long-term survival and success of the company.

The team has themselves set a target for wages to 40% of revenues, in line with your suggestion. I would have set it higher (and in fact right now our wage bill is closer to 60%) but that was not my decision to make. The 40-60% is of course not evenly distributed, though I would also quite like the thought of that, but the team themselves decide how to allocate it, so I guess they're doing the best they can.

I find the reality you perceive distasteful too - and I agree that it is widespread and it is sad that that is so.

This isn't correct.

When I say you're worth $X, I mean: "you're worth $X to me".

If you get a job offer elsewhere for $Y, you're still worth $X to me.

Even more pedantically: it's more like "you're worth at least $X to me" where there is some unknown maximum $X+delta that $Y may or may not be within.

> You say I'm worth $X. I go get a job offer for $Y. If $Y > $X, you were mistaken.

Not necessarily. The first employer says I'm worth $X to them. The fact that I may be worth more than $X to another employer is not a contradiction.

In general, there is nothing "wrong" with a particular employer and applicant being unable to agree on a mutually satisfying salary. It doesn't necessarily mean either party made a mistake in the salary negotiation.

According to standard economic theory though, the fact that someone says "I'm worth $X to them" is completely irrelevant and, because the transaction never happened, never becomes data. That's how market rate is determined and generally why D/S curves only have 1 intersection point - the point at which the transaction occurs.

The only data point that matters is the one where you got hired and started receiving paychecks, all others are not factors at all.

> According to standard economic theory though, the fact that someone says "I'm worth $X to them" is completely irrelevant and, because the transaction never happened, never becomes data.

I don't understand that. If an employer offers $X, I'd say that means the applicant was worth at least that much to the employer, assuming the job offer was legitimate. I suspect it's fairly rare to get an offer for $X, only to find out that the employer was lying and won't actually pay that much.

I have seen quite a few employers and some of them are noticeably much better at converting developer work into revenues than others. Those companies are able to offer higher salaries even to worse developers, simply because they can make more money on every quality-equivalent unit of work.

The $Y amount may be higher than $X because you are actually worth $Z to a median company, and $Y > $Z because that particular company is in the 90th percentile at turning developer work into revenues, and $Z > $X because that company is in the 20th percentile.

So, generalizing, the company that is capable of offering the most to you is going to be better at managing development teams, which is usually a symptom of being a better employer overall.

> You say I'm worth $X. I go get a job offer for $Y. If $Y > $X, you were mistaken.

Not at all. Company A may value you at $X, and company B may value you at $Y, and they may both be right.

I think the disconnect is that a certain job might be worth $x to the company. If the industry rate for that type of worker is actually $y then as much as it sucks for the company, it just can't afford that to buy that role right now.

You can offer $x and explain your reasoning, but if $x < $y, you might not get any candidates. Don't then complain about the "shortage of qualified tech workers".

You're absolutely right. Firmly agree you are worth what you can get in the market. This is why there's so much job hopping. Salaries don't tend to rise with market value--they tend to rise (or not) based on some company-derived formula that's based on some largely irrelevant measurement of the employee's performance.

What's my house worth? Who knows until I go try to sell it?

I've struggled with this a lot. I used to believe in making it a negotiation. The more I've seen, I've switched to paying for the position. Unless hard negotiation is part of the job description, it shouldn't be rewarded. I've also found that rewarding hard negotiators pushes companies down the path of paying men more than women for the same job.

If you can't stay in business without underpaying a lot of people, your business is in trouble.

Without salary negotiation, the company gets to choose the price. Unfortunately, Silicon Valley has shown that it is willing to collude to keep that price down. Therefore, when companies argue that they're banning salary negotiation to "promote equality", you should assume that this equality is merely a gimmick to hide the true purpose: lower wages.

If there really is a difference in negotiating ability between women and men, it would seem far more beneficial to teach women how to negotiate for a fair wage rather than abolish the entire thing altogether. In fact, teach all employees to quantify their abilities and how much value they will provide to their employer. Demonstrate that if companies are unwilling to pay them a fair wage, that they should not devalue their employment.

But the most recent steps toward banning negotiation will ultimately hurt all employees. When companies like Apple, Google, and other Silicon Valley companies agree not to hire employees from each other, and threaten to replace tech workers in the US with less-expensive H1B visas, we should question their true motives. This newest idea of "banning negotiation" is nothing more than another tactic used by a profit-maximizing entity to reduce costs.

I don't think "teaching women to negotiate" is practical. Is Google or Facebook supposed to send candidates to negotiation classes before offer negotiation time? Is there evidence that a training class can overcome whatever combination of nature and nurture causes the discrepancy?

Let the market drive the compensation level. If "the compensation for the position - take it or leave it" is too low, then the company won't be able to hire anyone, and they will have to alter it over time.

If it's "take it or leave it" from the employee, you wind up underpaying people with humility, and overpay people who are overconfident.

Note: I'm not at one of the large companies that have been in these lawsuits, and lost an internal fight to move to the "one price" policy that I'm advocating for. I'm doing my best to implement it in my part of the organization, and even there it doesn't always work.

Of course Google and Facebook are not going to send candidates to negotiation classes; they would stand to lose from such an arrangement.

Rather, there are many ways to approach this:

1. Salary negotiation could be included within curriculum at CS schools. (Schools would love if alumni made more money!)

2. Techniques could be included in books (like "Soft Skills"), podcasts, etc.

3. The culture in Silicon Valley could emphasize the importance of negotiating a fair wage.

Left to their own devices, companies WILL exploit those who believe that negotiation is "bad". Companies might not even do so intentionally, but might do so merely by hiring the cheapest employees who have the highest skills.

A side effect is that even if only 75% of employees negotiate to higher wages, the "market rate salary" for employees will increase. If, instead, 75% of employees did NOT negotiate, you'd see a depression in wages.

> 1. Salary negotiation could be included within curriculum at CS schools.

This is such a good idea. The modern school system oscillates between industrial training and academic pursuit, and very practical skills like this one (or householding finances) which could directly benefit the actual person, are terribly neglected.

What is it that stops teachers from talking about everyday matters related to money? Is it their own sense of inadequacy on the subject? Fear of letting out how much they (don't) make? Is it "political pressure"? Or simply that they love their academic subjects so much, they'd rather not talk about more prosaic stuff?

Taught software dev for four years in higher ed. I always had modules on resume/cover letter, behavioral interviews, core value matching, self promotion, salary negotiation, and other job-related things.

Student feedback always suggested these were incredibly valuable lessons.

> Is there evidence that a training class can overcome whatever combination of nature and nurture causes the discrepancy?

There is also the issue that the same behaviour is seen differently when coming from men and women. What is assertive in a man can be aggressive and offputting in a woman. Which means you'd have to have different kinds of courses for different genders, and it only starts there (more minority groups with less studies of what happens when they act the same as a white male). So, there is even more of a hurdle for potential training classes to overcome.

How much of that is the result of intrinsic gender differences vs. learned culture?

I always hear assertions about negative reactions to assertive women. Has any science been done on it?

Yes, it appears that women are penalized for assertiveness (more than men).

http://www.huffingtonpost.com/entry/men-see-powerful-women-a...

https://hbr.org/2013/04/for-women-leaders-likability-a/

Thanks!

Negotiations still take place, they just happen in a different format. For example if the Technical Lead is having trouble hiring due to low salaries for the positions, he would make the case to management that they need to raise the salary range for those positions. And the added benefit to this format (in a transparent organization) current employees would also get a raise which would probably help with attrition.

I think for very senior roles, individual negotiations still might make sense, as the value prop of those hires is highly variable and can have big impacts on the organization. But for roles like Software Eng I, and Software Eng II, etc... in the long run it is better for morale, attrition, and equality to use defined salary ranges. And you can still use bonuses to adjust compensation based on performance.

In these cases, though, we're relying on the employer to institute those salaries. However, the employer usually does not have an incentive to pay more if they can get the same thing for cheaper.

The employer isn't magically immune to market forces simply because they move to a transparent salary system. If they are significantly under-paying their employees, and they are not making up the difference via other benefits (shorter working hours, bonuses, etc...) then they are going to run into a lot of trouble hiring and holding onto employees.

And just because a company has defined salary ranges doesn't mean employees have no voice in the matter. If they feel those salaries are not keeping up with market rates, they can make that known to management, or they can go find greener pastures.

Except when they overcome those market forces through collusion. See: wage lawsuit against Apple, Google, and other tech Titans

In this discussion you're assuming the "employer" as a separate entity from the "employees". This was an enormously hard dichotomy for us to overcome, because it required me and my cofounder to let go of control over the salary structure and hand that over to the company as a whole. That requires a huge amount of trust that "the employees" care about the company as much as we do, really want it to be a success, are capable of informing themselves to make good decisions on behalf of the company.

It is a very worthwhile path, but it certainly is not easy for the founders (and is probably impossible in a large traditional, top down, public company where "the owners" are a faceless group of shareholders who definitely want to believe they are in control - even though they definitely are not).

At this point, we (my cofounder and I) have pretty much zero control over how much people are paid in the company. We provide advice to people making those decisions but we are not the decision-makers. And the conclusion of that experiment is that people actually seem to care far more about getting the arbitrary salary formula right than we do, so I believe it was very much the right choice to let go of this lever and let the company design its own salary structure.

Thanks to this situation (however difficult it was to get there), the problem you outline is not there because there is no "employer" entity separate from the employees that could collude or have incentives different from the employees.

Women can get (possibly unintentionally, possibly not) punished for exhibiting negotiation and leadership traits that are valued in men.

A friend recently had an offer, ready to sign, but the salary was lower than she wanted. She wrote back asking if there was room to move upward. She had the offer withdrawn.

This is pretty unfortunate. But we don't know if the company would have done the same for a male.

We don't know for sure about this instance, but evidence suggests that it's more likely to happen to a woman than a man - https://www.cfa.harvard.edu/cfawis/bowles.pdf

Sometimes it's worse than that -- women are seen as a cheap ticket.

I remember one of my first colleagues as a professional in this industry had to fight and fight to eke out a lousy 3% raise, despite being s superstar employee.

Later I found out that she was making 30% less than me, and They had just threw a ton of equity at me to try and keep me from leaving.

> When companies like Apple, Google, and other Silicon Valley companies agree [..], and threaten to replace tech workers in the US with less-expensive H1B visas [..]

When did these Silicon Valley companies threaten to hire less-expensive H1B visas? Do you have any citation on this? Are the H1Bs working for these companies paid less than non-H1Bs? Looking at the publicly available salary data for these companies - AmaGoogFaceSoft kind - seem to pay their H1Bs very well.

The reason is that psychologically, humans already account for the fact that women have it easier in life.

Take Buffer, for instance: their salary information is "transparent."

Consequently, since they've eliminated the possibility for negotiation, I will never approach them for prospective employment.

A "master" engineer taking low equity living/working in SF only makes ~$155k: no thanks.

https://buffer.com/salary?r=1&l=10&e=3&q=1

In my humble opinion: this kind of hiring strategy rewards low performers who get lucky and dissuades and marginalizes A-players who know what they are worth.

This is a fantastic side-effect of transparent cultures and salary structure: people like you who, for reasons good or bad, do not want to work in this kind of environment, don't apply.

You may believe that sets you apart as an "A player" and means we only hire B players. I believe the concept of A players and B players is false, and have discussed this here: http://danieltenner.com/2014/09/11/there-are-no-b-players/ . That said it is your right to believe this dichotomy exists and that you are on the right side of it. I put it to you that if you insist on having an A/B player dichotomy your desire for an environment which makes you feel worthy through paying you more makes you inherently a B player in the environment at Buffer or GrantTree, where this kind of mindset will have all sorts of side-effects that will make it difficult to work with you.

Almost all the people who we interview are very keen to work in this kind of environment. The last job we had opened (admittedly a relatively low skilled job) we had 200 applicants, interviewed about 20, and almost all those 20 were really, really keen to work in this open environment (and none found it a turnoff, though some didn't really understand what it meant). I like to think we hired someone who will be able to do the role very well and be happy doing it in our company. What I love about your comment is that you are far from alone to have this reaction, but because we are very upfront about our culture, people with your reaction never seem to apply. That's a win on both sides: you don't waste your time interviewing with us, and we don't waste our time interviewing you.

> where this kind of mindset will have all sorts of side-effects that will make it difficult to work with you.

I find it difficult to work with people who are compensated less than me. I want my coworkers to be better than me.

I do not want to work with people assessed as "masters" making $155,000/year in San Francisco, CA. I am accustomed to working with people being paid more.

Full disclosure: Over four years ago, I was receiving offers $10,000+/year more for like roles (SF, FTE, backend development). I would certainly not proclaim myself a "master," either. Especially not 4 years ago.

> I love about your comment is that you are far from alone to have this reaction, but because we are very upfront about our culture, people with your reaction never seem to apply.

Please do not turn this into a matter of "culture."

I find nothing wrong with a culture of transparency. I find Buffer's actual compensation packages problematic.

The lack of negotiation ability makes what might otherwise be a fruitful business relationship impossible. I do not believe that transparency and negotiations are mutually exclusive.

Sincere counter-question: how can you retain talent with fixed salary ceilings? Why would someone stick around when they're leaving a ton of money on the table?

Entirely my opinion: this is potentially the A/B dichotomy.

If someone is developing their skills, is extremely productive, is increasing their worth, at one of these companies they can choose to leave money on the table (altruistically donating their higher value to a for-profit company) or leave. Are they a "bad culture fit" because they wanted to make what they are worth?

Thanks for the open follow-up response. Re-reading, I realise my previous response was a bit unnecessarily snarky. Sorry for that.

> I find it difficult to work with people who are compensated less than me. I want my coworkers to be better than me.

I much prefer that attitude to the opposite :-) Though surely even better is to work with great people whom you're learning from in a variety of ways, whether or not they are paid more or less or the same. A lot of the value that someone can bring to your life is not correlated with their value to the market.

> The lack of negotiation ability makes what might otherwise be a fruitful business relationship impossible. I do not believe that transparency and negotiations are mutually exclusive.

I can't speak for Buffer, but in GrantTree it is not that you cannot negotiate, but that you cannot negotiate in secret - so it's more a discussion than a negotiation (I hope... sample size is limited at the moment!). As I mentioned in my original post, we start the ball rolling by saying where we think you fit on the pay scale and why, and if that's not where you think you should fit you are welcome to engage in a discussion to help us get it right!

> Sincere counter-question: how can you retain talent with fixed salary ceilings? Why would someone stick around when they're leaving a ton of money on the table?

> If someone is developing their skills, is extremely productive, is increasing their worth, at one of these companies they can choose to leave money on the table (altruistically donating their higher value to a for-profit company) or leave. Are they a "bad culture fit" because they wanted to make what they are worth?

There's a really good question here and I don't have a great answer to it. If you or anyone has any suggestions I'd love to hear them. To an extent, part of my answer would be: surely that's true of any small company. People might grow faster than the company. When that happens, I guess they leave and move on to something else. I guess that's ok. It's not like everyone has to keep working for GrantTree for the rest of their life! People might leave for this reason or for another reason. I hope they then look back at GrantTree as a place where they grew and learned a lot, had a great time, made some great friends and did some worthwhile work. In that time, they contributed to GrantTree's growth as well as their own, so it's not like the company is left high and dry here.

And no, I don't think that makes them a "bad culture fit" in that sort of insulting way. It might mean they are no longer a good fit for working here. That's ok. People change. Companies change. Someone that was a good fit to work in a small 3-people startup is not necessarily a good fit to work in that company 20 years later, obviously. That doesn't have to be an insult or a put-down.

What about a simple policy of revisiting the salary discussion on a regular (annual?) basis. As long as it's transparent and universal (not just for people who ask for a raise), it seems like it'd be in line with your philosophy.

We do that already.

Does "people like you" mean individuals who want to be compensated appropriately? How much can the transparency of an organization be valued at?

I read about someone who described his own salary negotiation: he writes the minimum salary he's willing to take, the recruiter writes the maximum they're willing to pay , then you show your numbers. If minimum > maximum, call it a day otherwise you continue the negociation.

His trick was to write a minimum of 0 as in if you're not satisfied with his job he won't take your money, supposedly he got much better offers doing the negociation this way, probably because he gets the other party to give a number much higher than what they would otherwise have said. Also it may have been for contracting work and not an employee position. (Can't remember where I read this, probably on hn though).

In a world of unpaid internships, I think there are probably a number of employers who would break out the contract with a big, fat goose egg on it if you tried this.

> "in a salary negotiation the first person to quote a number loses"

This assumption is wrong. Read about the anchoring effect. Your process still seems fine though.

If the assumption is that employers tend to quote a higher initial number than prospective employees, then the anchoring effect supports the claim that the first person to quote a number loses.

What's that assumption based on? I would assume the opposite, that the employer negotiates in their self-interests, and tend to quote lower numbers.

Right, but even then, you're in a position to counter their initial offer and move up from there. If you name the number first, then it only has one direction to move (and it's not the good direction).

That rationale contradicts negotiation approaches that I've read about in a few places, specifically the idea of "anchoring." (Other commenters have also mentioned this) I'm not sure how much data there is to support either approach.

https://en.m.wikipedia.org/wiki/Anchoring

""Instead, we run a pay evaluation process internally, including feedback about the value of the role and the person from all the people who interviewed the candidate. We publish all that feedback, as well as the suggestion/reasoning of our pay trustees (a group of people who use that feedback to try to place the candidate on our pay scale)""

Problem with this approach is that inevitably part of the formula is also "level" -- so you just converted one problem (negotiating $) to another (negotiating level.) That is when the real tricky people come in -- those who want a high level and just manage others, often adding no value (good managers add a lot of value, but if you tell people that the only way they can make more money is by being manager or senior managing level, then you force people who should not be managing into managing roles.)

> if you tell people that the only way they can make more money is by being manager or senior managing level...

This is actually a separate issue. A healthy engineering organization needs to have parallel technical and management tracks, with similar growth opportunities (both compensation and responsibility) at every level. On the tech track, think about a path that leads to CTO.

Of course, you'll still get people (in either track) arguing they want a higher level than they merit.

Asking the salary question of a prospect is un-necessary, and doing it to find opportunities to low ball someone, it's game-playing - it's wrong. The company should know about how much that person is worth. Low balling really isn't necessary to live up to your management responsbilities on the company side of it.

On the employee side, best to get out of the question as quick as possible. One thing to say is, I have offers higher than that already. They can find out your current salary, but the other offers, doesn't have to be disclosed.

> The company should know about how much that person is worth.

If anything, a person would know even better how much they are "worth". E.g. they know the necessarily short interview wasn't accurate.

Not to that company. I may be worth 150 in the marketplace, but that company pays everyone 120. The company is finding people at 120 and balks at the 150. The employee probably goes somewhere else and that's it.

Another way to approach this problem is to not anchor salaries based on previous salary. I've worked at a company where we hired obviously talented people with little experience. We hired them on as jr devs, with commensurate salaries, but within a year their salaries had increased to their productivity levels (30-40%).

I've seen too many people with low salaries get "exceptional" raises of 5% when everyone in the company gets 3%. So you have an employee who works his way out of tech support into dev admin but he's the bottom of a very large band. There is no hope for that person to get to salary parity when mountains have to be moved to go from 3% to 5%.

Yes, open information, even going so far as to teach your bargaining partner, is the best way to reach a really fair end result and making people feel that way.

The problem with this approach is that no matter how transparent you are or what numbers/ranges/data you give, the candidates on the other end will always think you're taking them for a trip. It's the same problem that car salespeople at "no-hassle" or "no-haggle" dealerships deal with. Even though they really cannot budge on their out-the-door price, you'll still have tons of people trying to eat at their already minimal profit margin.

I'm not sure that there is an individual solution to this problem. EVERY company (or most companies) would have to be ultra-transparent about their salaries before people can trust something like this, which works against how a lot of high-profile companies currently compensate (i.e. fixed salary ranges, highly variable bonuses)

There's definitely a problem there, I agree. In practice, the people that we take to that stage of the interview process typically have quite a lot of self-awareness and also know a fair bit about our company by then, so so far it's worked out alright. But I definitely see that that could be a problem with some people. As I said elsewhere it's not something any company can just implement without thinking about it and have it just work. It takes a lot of work in many areas of the business.

It was always pretty simple for me personally, If you don't want to pay me what I want, you are free to hire someone else.

I find the most important part is being able to walk away, If you negotiate from a position of weakness or need you are behind already.

If I am hiring I know what I can afford to pay, what I think the position is "worth" and what I want out of it and make an offer according.

I like ideally to pay for work not for hours etc, if you give me what I want I don't care if I am paying you $3000 dollars and you worked a half hour and slept for a week out of town, I would consider that smart and efficient.

I find its the person who is applying that has the power not the company and I think that's an important lesson for people who are applying to learn. If "they" are not willing to pay me what I want, that puts us on a bad start already.

> I find its the person who is applying that has the power not the company

I think you are assuming the person applying has some sort of safety net (a current job, savings, alternate income.) That is where the BATNA comes into play. Sure, if you are already making an acceptable amount of money to meet your needs, aren't overworked/over-stressed, and relatively satisfied then you are indeed in a position of power. If you need to get hired some place within 2 months and have been having trouble getting a job then you very well might not be in a position of power. Not all people have the ability to walk away.

Then the person applying will be in a position of weakness. That to me is letting "worry" even if real drag you down. I think when you really need something it is even more important to negotiate from a position of strength, if not they will sense it and pick it apart.

In some ways its much like dating, does anyone really want the desperate type ?

"Always be able to walk away" is not very good advice to people who don't have the option to walk away, whether people should always have that option or not in a perfect world. "Pretend you're able to walk away" possibly is, but not everyone's good at playing games like that.

The alternative to not working is, eventually, losing almost everything you have. The alternative to not having a romantic partner is, well, not having a romantic partner. You're not going to die from lack of love.

> not everyone's good at playing games like that.

For those that aren't good at faking it until they make it (negotiation): obtain the opportunity to walk away.

Take the position as offered and immediately begin seeking new options.

You get what I'm trying to say. :) Thanks for trying to clear it up.

"always be able to walk away" to me includes never allowing yourself to be in a position where you cant walk away. I think of that as an actual survival trait not just a business skill.

I would also say never pretend, actually be willing to walk away. Someone good at psychology or picking up subtle clues will see right through pretending.

Anyway you slice it being desperate is never good, don't be desperate.

I'll be honest, you sound like someone who has never had to be desperate. There are times in someone's life when it isn't a choice.

What a wonderful piece of advice. "Never get in a bad situation!" - people don't intentionally get into bad situations, really, believe it or not.

Just pick yourself up from your boot straps! Or cash in some of that 2m trust your Dad left you. Come on this isn't hard.

> In some ways its much like dating, does anyone really want the desperate type ?

I think this question has been answered and studied quite well. If you have a significant lapse in employment (with or without explanation) or are obviously needy, prospective employers will have negative biases that directly translate into less compensation.

That is exactly what I'm saying. They are in a position of weakness. Their BATNA is losing everything they have. You don't need to be desperate, but you can't be as cut-throat.

You have valid points that I think are very much worth considering and should be. I appreciate good convo in threads like this so didn't want to come across as trying to be petty or battling your perspective. Also yes I understood your point :)

Same here. I totally agree with the fact that you should always be negotiating and don't sell yourself short by thinking you don't deserve what you are worth.

Even in that position you can still negotiate though. A good company won't revoke an offer simply because you asked for more money. And if they won't budge on salary you can ask for more vacation time, etc.

Oh I'm not saying "don't negotiate." Always negotiate.

I'm just saying that OP sounded like he was saying "if they don't meet your demands, walk away." Which is great advice if you can afford to take it.

> Not all people have the ability to walk away.

So you hire someone in a weaker position for less or even exactly what they're worth: 6 months later, when they're now in a stronger (employed) position, they find a new employer and you're stuck with the ramp-up and churn tab.

It's a seller's market right now. The biggest advantage an employer holds is the disparity in information; most underpaid people aren't aware they're underpaid.

> I like ideally to pay for work not for hours etc, if you give me what I want I don't care if I am paying you $3000 dollars and you worked a half hour and slept for a week out of town

I would say it almost never works out this way, more likely you end up doing a lot more work than you originally imagined and thus bringing your hourly way down. There's also a strong incentive for the buyer to manipulate this to their advantage.

The exception would be very small and predictable jobs (tasks?) but for everything else my advice would be to always get paid based on hours actually worked.

Recently bought a car and went by myself cause a friend and wife didn't even want to talk to the sales guy - such a fear of negotiation.

I want to be prepared going in, so the plan was: They have a price, I counter. They counter in the middle. I either take that price or walk, that's it. No further negotiation. Reduced the stress by just sticking to that.

Just make sure you aren't waiting for them to relinquish the keys to your car they took to evaluate its value as a trade-in. I once had to threaten to call the police in order to get the keys back so I could leave!

Threaten to call the police? Call them. Get an incident number. Report them to whatever regulators are around.

Actually, never trade in your existing car at the dealer where you make your new purchase (unless you are a skilled negotiator). Typically, whatever discounts you ask for on the new car, they will quietly subtract from their "evaluation" of your old car's value.

Alternatively, have another offer in hand. CarMax is a good way to establish a minimum quickly and easily. You can always get more in the private market, but you should weigh the trade-offs in speed of transaction. (E.g., I could spend 10 hours and the next 2 weeks posting on Craigslist and dealing with people and get $12k, or I could sell to the dealer now for $10k. That might be worth it to me.)

I've done this a couple times: the first time the dealer came back with a better number, and I took it. The second time the dealer was way low and I sold on the private market for 100% more.

The real key is to separate out variables. Negotiate only on the bottom-line cash value of the car(s), and know when to walk.

Last car I bought, the dealer tried to play hardball and told me there was another individual looking to purchase the same vehicle for more. I told them to take the other offer, and put my coat on. I should have gone over and introduced myself to the other guy.

> was another individual looking to purchase the same vehicle for more

The idea that a car is a scarce good is a fundamental ruse that car dealers have been establishing for decades.

The car would be at an auction somewhere, not a car lot, if it were actually a scarce item.

Never fall for the "it's going to sell fast!" story. Great. So it does sell fast, there'll be another truckload of them next week.

I'm like the guy in the The life of Brian "don't you want to haggle!".

If I take my wife I play it cool and say "hmm, it's okay" and my wife starts arguing with me, "no it's great what are you talking about" and the salesman gives me a look of pity before naming his price. Oh god.

Let me share my horror story -- I fell for a company that offered me the same salary (no raise despite big promotion.) Then, he (Division CTO of Fortune 500 medical company) started subtracting salary from this baseline for all my "benefits" like free shuttles, 401k matching, etc. I was supposed to take the lower wage in exchange for amazing work, 3 fully paid conferences a year, yada yadda.

Two months into joining, the shuttle went from free to paid. Ouch. Then, the manager expected me to stay late 3x a week, which meant i could not even take the shuttle 3x a week, and instead have to take a taxi. Still not enough salary to buy a car + insurance + parking. Then policy changed and 401k match disappeared. Finally, policy changed and all conference reimbursements ended. Final blow -- my PDP is tied to 3 conference posters a year, so i pay out of pocket for travel/registration/hotel.

By the way, the work is great, but i'm paying so much out of pocket that i'm getting the hell out of there. Sucks for me. Sucks for the manager too -- I spend half the day now doing eLance projects.

Yowch. When you say "subtracting salary", do you mean in the offer, or after you were hired?

I was given a salary figure, until I got on-site for the final round, at which i got a very hard sell and the reveal -- some of the salary was "in kind" -- free shuttle bus, 401k match, etc (all in policy, not in offer letter.) Policy changed shortly after I joined, and I learned the policy change was being discussed months before I joined -- so the hiring manager extracted these concessions knowing full well they perks may be reduced or removed.

>> the manager expected me to stay late 3x a week

I'd argue the job isn't that great.

You are probably trying to show us how bad your employer is. What I'm reading though, is how you should have walked away at least 5 times in the process.

What part of the work is actually "great" btw. I would guess you don't have any other job yet. Because everything sounds very horrible.

It has been a year now. I moved to a high-cost-of-living area where even owning a car is expensive. There is a cost to moving back as well. A lot of it is psychological - I cannot believe i allowed myself to be fooled so badly, it has really shaken my confidence in HR and hiring managers.

Yeah that is the old 'total compensation' switcheroo. Where you finish negotiations at what you assume is a salary number, but the employer later claims it was a total compensation number (salary + benefits). When the 'benefits' could change later, or they are accounted for using Hollywood accounting.

Another common one to look out for is 'projected bonus'. Where you find out that you make 1/2 of what you thought you agreed to, but the manager says "Making that much is up to you! You could make that number with bonus" (if you hit your ultra stretch goals that the company could change at any time).

These are both reasons to insist on an offer letter with the salary figure clearly stated. Also pay attention to the background of a hiring manager. This kind of BS mostly comes from people who were previously in a sales role.

Two ways to answer the "current salary" question

- say that your salary expectations depend on the work, the people, the work hours, vacation policy, etc, so it's too early to discuss salary, or

- ask what the company pays people in the same position. They won't tell you, but that establishes concretely that it's private information.

If they do share the information with you, you can respond with "my expectations are higher", or "that's within my expectations". And then if they persist in asking yours, you can choose to answer or to stonewall. You got the data, so now the mystery is over and you have control of the conversation.

This comes across weak, phony, and panderish:

> I think the best way to answer the current salary part is to say something, like that you’re not comfortable sharing that information, and you prefer to focus on the value that you can add to the company, and not what you’re paid at your current job

This sounds clownish, like playing a game:

> “Well, if you’re trying to qualify me for a range, why don’t you tell me the range, and I’ll tell you if I’m in the ballpark?”

This sounds wonky and comes across as an insincere:

> “I’ve been entrusted with a variety of information by my current firm. I intend to keep their confidences on that sort of thing. They consider their salary compensation private.

Agree with most of this. However I'd say that asking "can you share your range" when appended to your first recommended response can be very powerful.

By making clear that you don't have enough info about the opportunity to properly value it, but recognizing that they need to qualify you based on their range, you're putting the ball firmly in their court to bring more data to the table.

Companies who remain firm about not giving out any info but demanding a salary from you are probably not places you want to work.

I've had multiple situations where I did answer (honestly, too - before I knew any better) the "dreaded" question up front and had the recruiter tell me: "Wow. You must work for a really great company! We can't even come close to matching that." Process ended right there, countless time saved. So, as with all things, YMMV.

Same here. As soon as I say what I make recruiters usually congratulate me on making what I make and won't call me back. So recruiters are only good for run of the mill, entry level folks, not really for highly skilled or specialized developers.

Yes, they're frequently just looking for butts to put in chairs. Getting the numbers out of the way first helps to avoid wastes of time. But the other side is true also for more junior or underpaid developers. They need to use tactics like these to get themselves to the right side of the bell curve. Once you've developed the experience and skills and had the good luck necessary to move you into the upper range of compensation, it helps to tell them right away to avoid wasting time with employers who aren't interested in paying up for senior talent. Again, though, if you know the potential employer has paid rates / compensation in the range you are looking for in the past, it is also safe to delay because you may get a better offer even coming from an already high compensation.

It depends what kind of recruiters you use. At the end of the day, the company that hires the recruiters (whether they're in-house or an external company) should be fine tuning the recruiter's filtering system. With enough patience and direction they can be excellent to find high skilled individuals who are looking for a new job.

If they're just looking for butts in seats, why do crooters stop talking to you unless you have at least n years experience (n often quite large) in the client's exact tech stack? "They're looking for a candidate who's ready to hit the ground running..."

Because they don't want to waste their time on someone their client won't agree to hire. It's a numbers game, and from a time perspective, meeting you for coffee and shopping your resume around isn't completely free.

Years of experience in the client's stack are a pretty good proxy for whether the employer will want to talk to you.

You can figure that information out pretty quickly without needing to disclose your current salary. It might take a LITTLE longer, but not THAT much longer. I think an extra few hours is worth multiple thousands of dollars every year.

To clarify my original comment - I was talking about in-house recruiters. Ones that have a vested interest in negotiating you down.

3rd-party recruiters? They just want you to take the first offer you get so they get paid. Tell them whatever you want.

Whenever I am negotiating a salary, even if I have to reveal what I make now, I will end that statement with "But based on my experience and value that I bring to the table, I am expecting at least xyz for my new role otherwise it is not worth it for me to quit my current job".

This way, you make the whole "current salary" irrelevant. The point is that any good employer will NEVER let go of a candidate who is an excellent fit for their role but they had a huge gap in current vs desired. They only let go of candidates who either are not a good fit OR are asking for a very very high number that is literally out of the budget assigned (more applicable to larger corps.). But then again, it has nothing to do with current salary crap.

Completely agreed on negotiating without the "current salary" perspective.

I've always requested to keep my current salary secret, but I've never met a hiring manager/HR recruiter that's ok with this. I suppose knowing what I make comforts them that their offer isn't completely crazy, but I think it's also evidence of a disturbing bias against the unemployed/underemployed.

> I've never met a hiring manager/HR recruiter that's ok with this

There's a very simple position to take here: "My compensation is a function of the value I will be providing to your company, not the value I provide to my current employer."

Be assertive. At least in the United States, short of a backchannel reference check, a prospective employer has absolutely no way of confirming anything you say - a fact that can be brought to light if this kind of question ever comes up.

At the moment, for good talent, it's a seller's market.

> evidence of a disturbing bias against the unemployed/underemployed

There is a definite bias against un(der)employed. This has been well studied. Furthermore: your BATNA while employed is infinitely better (for most people).

Hi everyone! That's me you hear talking to Patrick ;) If you have any questions about the episode or salary negotiation in general, ask away! As you can probably tell, I love talking about this stuff!

Hey Josh! Hope you don't mind me tossing the link to your workshop on youtube here. It was super helpful!

https://www.youtube.com/watch?v=sN19aNmjBoU

I don't mind one bit. Thanks for posting this!

Most discussions about salary negotiation are about postponing the money discussion until we know there's a fit. But what do you do when you-as-applicant need to be sure you're not wasting your time (or theirs)?

That is: I'm really senior in my field, with 25 years of experience, and for several years I've been commanding top dollar. (I'm worth it, too!) But often I start discussions with would-be employers (or clients), wherein the work sounds enjoyable, and they clearly are falling in love with me... and then a half hour later (or three days later) we come around to money ranges, only to discover their budget is half what I'd consider accepting.

I can end off with, "I hope you do really well, so that you can afford me sometime soon!" but I'm always saddened and frustrated by the process. Because by that point I'm imagining how cool it would be to do that job.

How do I signal to a client, "I'm expensive -- and worth it!" without saying, "Hey, can you afford me? Because otherwise let's not even talk."

This exactly. I'm senior in my field (and pretty damn good), and many times recruiters will contact me about a position that sounds like a great opportunity - for example, I was recently contacted by a large financial services company who wanted to hire a senior manager to lead a cloud services team. When I told them my salary expectation, they said their range topped out at half that.

First, I was a bit shocked to hear that Fortune 500 companies with $USD revenue in the billions would hire senior managers and want to pay them what would be considered an entry level salary for a good programmer right out of university, but honestly, I've defaulted to just telling them my salary because I want to avoid all the time wasting that multiple interviews would require, just to get to the point where they really like me, and would I please consider their great position where I'd have more responsibilities, longer hours, at half the salary...

> many times recruiters will contact me

Recruiters are easy: "What is the client's targeted range for this position?" or "What have you placed other people for at this company?"

If the top-end of the range is within some arbitrary percentage of your target, pursue, otherwise: "no thanks!"

You can turn it around on them a little bit by replying "this sounds like it may be a good fit for me, but I'll need a salary range from you in order to move forward" and then the whole conversation is short circuited.

Third-party recruiters and staffing agencies won't have this conversation or play this game at all: they'll be 100% upfront with you upon demand.

"In-house recruiters" would require that kind of short-circuiting, and it will be met with varying results.

Asking: "what is the top end of your current employees' salary range for X role/experience?" can be good, too, to preempt the conversation.

It's not asking them to make an offer or anchor a price for you specifically, but will save everyone time when you discover that the top-end is 40% lower than you would even interview for.

If the prospective team is large and diverse enough, there will exist people that are more experienced and more-compensated than you. At that point you will at least know that they're paying it to someone.

If they're not paying anyone what you expect: you do not want to be the most well-compensated or smartest person in a role at a company and should pass on general principles.

Have you thought about lowering the hours worked per week? For instance, if they aren't willing to pay you a 40hr/week salary, would they be alright paying you less but you only work 25hr/week (putting in enough productivity in those hours to warrant paying such a high price for your services)

Or arguably, if you are close enough in the salary range, accept a 10% lower salary for 5 weeks of vacation.

I've done that. In fact, the last client I got responded to my rate by saying, "We can't afford that." So I said, "I can't lower my rate, but we can see what I can accomplish with 50% of the hours." And I got the gig. We're now towards the end of that contract, and now both of us are in a better position to know what/whether I can deliver what I promise.

Still you have to know what you're going into. If I'm looking for a 40/hr week gig (consulting or staff), I'm going to be less thrilled with 20 hours a week.

I just come right out and basically say the latter to inquiries and it's fairly prominent on my resume as well.

I enjoy both what I do and the company I'm at, which puts a clear floor on what I'll entertain. If I can't get confidence early in the process, it leads to a lot of wasted time. In practical terms, that means I invest less than an hour before figuring that out. ("I'm pretty happy here and my current comp starts with an X" often cuts the conversation off right then, which is ultimately best for both sides. It's just business.)

I won't say that I'd never consider a pay cut to change roles, but I work for money, for me and my family, and I'm going to try to maximize my and my family's happiness (financial security included).

> I just come right out and basically say the latter to inquiries and it's fairly prominent on my resume as well.

How do you word it on your resume? (I'd like to steal the verbiage. <grin>)

Most people reading this resume online shouldn't bother contacting me. I'm happy at __XXX__ (the work, the business, and the leadership) and very well compensated here.

If you believe that you have a position for which you honestly think I'd be interested, please feel free to contact me. I insist however on restricting phone calls to principals only. I have too much to do in my day to field cold-calls from head-hunters looking to fill their Rolodexes with my name or the names of my colleagues. In fairness to my company and my colleagues, I won't assist you on a fishing expedition.

If you are a headhunter reading this, please take a moment to consider whether the position you have to fill truly fits like a glove, before investing your precious time (and mine) on a phone call. Headhunters are encouraged instead to e-mail, as this takes less of your time, and is less intrusive to my workday.

Thanks for your consideration.

(That's maybe a little aggressively anti-headhunter, especially if you're in job-search mode, which I'm not. I have nothing against recruiters per-se, but I also don't want to chit-chat on the phone with them unproductively for both of us...)

Just curious, is you current employer aware of your resume and what do they think about it?

They (probably) are, in that I submitted the URL to them when I originally applied 13+ years ago and it's been used by different parts of the company for various corporate purposes over the years (board/VC decks, recruiting, depositions, etc).

Which angle are you concerned about: that I have a resume live on the internet, or that the contents are what they are(, or something else)?

As an employer, I would never worry about an employee having a resume out there (or being on LinkedIn/theLadders/other), nor do I care what content they put on the web that isn't company-proprietary. If a company thinks they want to control such things, they probably ought to find better things to concentrate on, IMO.

Excellent question. I have lots of thoughts, so I'll try to summarize.

1. This is just the reality of negotiation: sometimes you'll find out you're pretty far apart when they finally make an offer. The value of your time matters, but in general I think the payoff when you DO command top dollar at a good company is worth the time investment. (Think of this from a Sales perspective - they deal with hundreds of leads, often narrowing them down to the best-qualified leads and closing only a few deals. That time working with unqualified leads is not wasted per se, it's an investment to get to the good leads where they make their money.) 2. Signaling is important and you should continuously do this throughout your interview and negotiation process. My one-sentence strategy summary for interviews is "You're telling them a story about how their company will be better if you're a part of it." Your job in the interview processes not to save time—it's to get the best job offer possible so you can negotiate or walk away if it's not a good fit.

I realize this is controversial, but I think it's best to not think of interviews that don't lead to job offers as time wasted, but as time invested in finding a good fit. If you're interviewing for a huge volume of jobs that always end with an offer far below your range, you may want to evaluate whether you're applying to the right jobs. But if you occasionally interview and find out that they can't met your pay requirements, you can just move on to the next opportunity.

One last thing: Make sure you're doing market research to determine the value of your skillset and experience in your industry. If your market research confirms your salary expectations, then keep interviewing. If it doesn't, then it's possible you're at a company that really values your work and you might consider the opportunity cost of leaving.

Does this help? If I can clarify anything, let me know!

This is me, too. If you know what you're worth and what salary or range you are willing to take, you can just answer the question. I like to dodge the question about previous salary if it's lower than I want, but if there's a number that would make you happy that you know is in step with the market, you can just say it.

> How do I signal to a client, "I'm expensive -- and worth it!" without saying, "Hey, can you afford me? Because otherwise let's not even talk."

You're missing a step in your sales process, which is the qualification part. Before letting a conversation go into much details or letting it turn into an interview call, take control and state that you'd like to to spend 10-15 minutes asking questions to make sure they're a good fit so you can make best use of each others' time. Then ask:

- "So tell me, why are we talking here today? What is it exactly that brought us into this conversation?" [Let them throw up their problems on the table, but only in broad strokes.] (~5-10min)

- What their decision process is and how they'll fit in [in passing] (~1-2min)

- How urgent it is for them to fix the problem [if it's not clearly urgent] (~1-2min)

- What their ballpark budget is [~2-3min]

Most prospects resist giving a figure at this stage. A trick to get them to give a ballpark is to announce a scary-sounding range. As in "hold, the type of contracts I work on start at $5k and go as high as $500k. I don't necessarily need your specific number, but can you at least let me know where you more or less fit in that range so I can know how much I can help you?"

Sometimes, there's an obvious and intuitive mismatch between what their problem is and the budget they're willing to allocate towards fixing it. If you suspect they've deeper pockets than what they said, you can occasionally hold their hands and walk them through their own numbers. e.g. "Hold, let me try to see if I get it right. You just told me your team of 6 engineers was on this for 4 months and failed to make this work. Depending on how you pay them that likely makes it a $150-250k type of problem. Are you sure your $20-30k budget range will allow you to solve it?" [Then see how high they could actually go, without negotiating or promising anything on your end.]

That way you won't waste time going over prospect problems for hours on end without the slightest clue of whether it'll be worth your time or not. If they're clearly under your number, say it up front upon [dis-]qualifying them. Either politely stop the conversation there, or spend the rest of your meeting giving them a few good pointers. [Then ask for a few referrals.]

When in doubt: it's better to be the expensive consultant that "we couldn't afford" than the one "we are getting for a steal."

With appropriate qualification, you'll get those referrals and the respect.

Hey Josh, i have one question - how do the rules about disclosing salary change when you're talking to an external recruiter (from an agency)?

I don't quite understand who's "side" they are on - on one hand, it seems reasonable to tell them the real range i'm looking for upfront so they can narrow the search, on the other hand they might reveal that to the employer..

Not Josh, but I would say they're on their own side. They get paid when you accept, so the want both the company to raise it's rates and you to lower yours.

So something I'd like to get advice on is: what do you do negotiation-wise if actually salary is not the thing you care most about? Suppose you (for health reasons or just because you don't need the extra money and like the reduced stress) want or need to work less than the usual five-day week -- at what point do you bring up the "hey, how about a four-day week" question, when the typical employer is looking for a five-day-a-week full time employee? If you raise it early then it seems like they're just going to file your application in the bin, but bringing it up only at the end seems kind of awkwardly blindsiding them...

(I can see how it would work negotiating this as an already-established employee where you're a known quantity to the employer and they'd rather not lose you altogether, but not how to get that kind of setup from the start with a new employer.)

It seems like the same principle is in play: demonstrate your value first, then talk about terms after they're sold on you and want to make an offer. I can't imagine any company that would flat-out refuse a talented candidate over a 4-day week request, but I think most would sideline you if it was brought up before you'd demonstrated the value you can add to their business. In fact, I'll bet many companies would view a 10% paycut for a 10% reduction in hours (4 days @ 9 hrs/day) as a no-brainer win to get a talented hire.

I don't think so. 4 day work week would be a deal breaker for most companies. If Joe gets hired in and never works Fridays pretty soon everyone else will want Fridays off too. Salary is irrelevant, it's human nature.

I previously had a colleague reduce days in exchange for a pay cut, it was clearly messaged to us (a small startup) that there was a tradeoff happening, and the rest of us were happy to make more money working 5 days/week. I think the human nature part is wanting to be treated fairly -- it's unfair if you get paid the same and work less, but it feels fair if you make more money for working more.

I think you need to bring a request like that to the table, early in the hiring process. And whether or not they "throw your resume in the bin" will depend on how you frame the question.

- "Are you guys open to the idea of a lower salary, in favor of an extra day off? I'd love to work on my wood working, and spend time with my kids... Time is more valuable than money right now".

v.s.

- "I'll take that salary, and I want an extra day off every week."

Better to phrase it as: "Are you open to the idea of a 4-day work week for me? How would that affect my overall compensation?"

I think it's unwise to reveal your willingness to be paid less. Mostly because you should never reveal your willingness to be paid less. Never leave money on the table.

Agreed. That's a better way of saying it.

Following the podcast argument, I'd say you bring it up when you're ok to talk numbers. At that point, ideally you've already "made them want you" enough, that losing one day could look like a price worth paying. You should probably be honest though, and talk about it upfront as soon as compensation negotiation starts, accepting (or even suggesting) they could lower their salary range in exchange. Or simply negotiate on extra holidays, so you can use extra days to actually get a 4-day week once or twice a month.

If you're a super-hotshot ninjastar who wrote Rails and founded a Linux distribution that now runs the Japanese train system, then you could probably get both a spectacular salary and part-time hours, but realistically the two will not go together for most people. (Which, incidentally, is a typical problem for women with families and one of the reasons their salaries remain lower on average.)

I've been meditating on finding part time work for a while now. It seems the only options are to become indispensable to an organization before you demand it, and then you can keep it until they replace you, or to become a work from home contractor. If you have a new child and are without a stay-at-home partner, you could possibly prolong the amount of time before being made redundant but that seems to be the only socially acceptable reason to want to work part time. Mothers have been complaining about the absurdity of this situation ever since they joined the workforce. The only way to find respectable part time work while staying within the system is to go after traditionally women only jobs like nursing.

The main thing that I liked about using Hired.com during a previous job search was that they made the salary offers very transparent during the bidding phase and it completely avoided sticking me, the candidate, with the salary question. By the time I started interviewing at companies their initial salary offer was more than what I would have been able to negotiate myself, mostly because I didn't even know to ask for that much.

Two things we have done to fix the waste of time, human energy, and shenanigans around salaries:

1) Post salaries with job descriptions. (e.g. seneca.systems/careers/growth/go-to-market-strategist-product-marketer)

2) Pin salaries to job position[1]. We do not allow individuals to negotiate their salary separately from their position. If you have the same position, you make the same salary.

[1]: https://github.com/SenecaSystems/employee_handbook/blob/mast...

"We do not allow individuals to negotiate their salary separately from their position. If you have the same position, you make the same salary."

This is great from a company perspective, but it essentially allows a company to get an employee at a much cheaper rate. Employees with more experience will get the same pay rate for the same job as someone with potentially much less.

Since all companies don't do this, I probably wouldn't ever work for your company knowing this is your policy. I bring much more value to a company with all of the experience and knowledge that I've gained.

At my last 9-5 job, I was able to get paid almost 20% more than many of my co-workers because of my negotiating skills and experience.

I just have to shake my head when I see so many people fighting for less power, rights, and inevitably less money and calling it a 'win'.

But, this doesn't really matter to me anymore. I've owned my own company for the last 5 years and don't need to negotiate my own salary.

Don't companies that try that sort of thing usually have well defined bands? Software Engineer I, II, III, etc?

I can't make any sense out of your argument. How on earth does this drive away people with experience?

I know what I can do and I know how much money I want to make. A company advertising a job with a salary attached would get some bonus points in my evaluation just because of their honesty and willingness to step out of the bullshit negotiation game, but I'd also know up front whether their expectations corresponded with mine. I'd only apply if it sounded like a reasonable offer, and if it sounded like a reasonable offer, why should I hesitate to apply?

Your perspective must be very different from mine, because I am totally failing to see this from a point of view where I can make your words make sense.

My observation is that salary negotiation has little to do with negotiation. The management side of the table is never thinking in terms of economics and has no idea what their BATNA is.

I think this comes from HR and leadership which can't quantify what the right balance is for comp vs their BATNA.

For engineers this is especially challenging because metrics are hard to come by and correlate with the $$$ going out the door.

I've been working for over a decade. There is ONE and ONLY ONE rule i've seen universally followed by HR -- your pay rises with the # of people reporting to you. Regardless of whatever managers say about running a lean shop or budget or whatever -- the more people you hire and manager, the more money you make. If you can do the work in six months, tell them 18 and hire two others. If you can do the work with 4 FTEs, tell them 12 FTEs and get a nice promotion. Increase employment, get great documentation and unit tests, and play to the foolish HR policies HR has cooked up. When people get paid for productivity, then switch to lean. Until then, play to the metric they set.

https://en.wikipedia.org/wiki/Goodhart%27s_law

This just seems like a walkthrough how to educate a shitty manager who got their "business-degree" from dilbert comic strips. The last thing a manager wants to do is to lowball a guy who's performance depends on his own good faith. If I have to explain to the manager why this is a bad idea and why he is putting me at disadvantage while keeping key information from me and using sleazy tactics he saw in the "boiler room" against me then how can I trust this guy to have my back in the future?

I got to say this almost never happens in the big5 companies nowadays. There are countless internal trainings for recruiters specifically not to do stuff like that and especially anything remotely similar to what you see in pop-culture. I mean what are the chances none of your candidates would have seen "Suits" or "The Wolf from Wall Str." after all? Even if you manage to hire somebody below their market rate it will be just a few months hanging out with peers and he will find out and be resentful.

It turns out there are a lot more than 5 companies out there in the marketplace... And if you think you got a fair initial offer you almost certainly did not.

I referred to top5 just as an example of professionalism, possibly backed by tons of data and analytics internally too. Which to me means it's the best methodology currently known.

Well if I didn't get a fair initial offer then the manager must think the risk of me finding out will not affect his goals. I accept that, as long as they accept it too. But I don't want to find out I was lied to and then expect me to be loyal.

He doesn't even have to hang out with peers, one simple search across some popular job site nowadays (e.g. glassdoor) will immediately land you with a decent salary amount for your desired position. We've already entered the brave new world where the concept "salary is private information" is dead, and, if one is a developer active on Github (or other OSS platform), then the concept "my work portfolio is private" is also dead.

So you're absolutely right, the worst thing for a hiring manager and a potential employee to do is set themselves up into adversarial positions of who can best manipulate and "break" the other person first. Because a company built with employees and management who can't trust each other, and are in constant underground wars to gouge the most out of each other, is bound to get trounced by competitor companies in the open market

I have friend who got an offer at a large, well known tech company. When he graduated he ended up negotiating a significant five figure raise by looking at other companies.

So I don't agree with that statement. He was basically a new grad, so the standard offer was probably obtainable especially considering he knew employees at that company. And they still did not make him an initial offer that was competitive with other places.

The original blog post is one of the best reads on the topic. Especially for people who never tried to negotiate before or always failed.

http://www.kalzumeus.com/2012/01/23/salary-negotiation/

My fantasy negotiation scenario:

ME: "Ok so you are willing to pay me 200k to work 8-9 hours a day, how about paying me 100k to work 4-5 hours a day?"

THEM: "sounds awesome"

What would be a realistic path to negotiating part time when full time work is expected?

Yeah, I don't know, hence the "fantasy" adjective. But, somewhat realistically, the cream of my day lasts on average about 4 hours (longer when i'm hot, shorter when i'm not). So this really would be a bargain for an employer.

Love these, but patio11 needs a better microphone setup, its so echo-y and robotic! Please take this as helpful feedback rather than hurtful criticism.

Definitely found this too. Josh Doody sounded crystal clear though.

It's actually less the microphone and more that I recorded this at my coworking space, whose only room for recording is literally a glass box. I'm going to try to find another room to do podcasts in -- the audio engineer flagged it, too, but shipped beats perfect.

If you're stuck with recording in that room, perhaps you could try getting something like an SE Electronics Reflexion Filter? It's like a tiny vocal booth just for your microphone, to block reflected sounds.

http://www.seelectronics.com/reflexion-filter-x/ http://www.seelectronics.com/reflexion-filter-pro/

Not sure of RRP in Japan, but someone is selling the RF-x on eBay US for $80. (I don't have one myself but I've been meaning to get one for years, didn't even know they had a home-studio model until just now.)

Has anyone tried to beat the interviewer to the punch on the salary question? Put them on the spot by asking their range before they hit you with it?

Yes, but it's typically a factor of a bad HR department.

Don't let the recruiter hang up on that first phone screen without satisfying yourself that they could make a competitive offer. Otherwise, you're just wasting time. They should have the same desire, hence this is only an issue with bad HR departments.

It's not worth it to jump to salary immediately. You come off as either selfish or naive.

So yes, I've done it. You get to the end of that call, and you realize you haven't talked compensation. So you tie in with interest and next steps: "Sounds like I could be a great fit for this position, and I look forward to talking further with the team to confirm that. I do want to make sure we're on the same page in terms of compensation..." Then you go from there.

> You come off as either selfish or naive.

Or, if framed appropriately, expensive and valuable.

Your time is money. You do not want to waste it on a role that has compensatory packages beneath what you'd be willing to take. You are a professional doing another professional a favor.

Framing this correctly is a bit more nuanced, however.

If you're talking to an external recruiting or staffing agency, however: immediately jump to salary. They will not hesitate and have no opinion on you as a candidate. You're saving their time and they're not emotionally staked in the possible negotiations to come.

What follows is an honest salary determination process, where no party has incentive to lie. It is also very fast. The rules are as follows. (Can't remember where I read about this.)

The company and the candidate write on a piece of paper a salary. The company should write the number above which it is not willing to pay the candidate. The candidate writes the number under which she/he is not willing to work for that company.

The numbers are disclosed. If there is an overlap, they sign a contract and the salary is the average of the two numbers. Otherwise, there is no hiring.

Edit: the parties can play this game only once

you still have a strong incentive to lie, do you not? Since the final salary is the average of the two numbers, employers want to go as low as they can and prospects want to go as high as they can.

in fact, this system punishes honesty even more than the current one -- if I am honest and the other person is dishonest, the dishonest person wins because they will pull the average in the direction they want and I get a worse deal than if we were both honest.

Say the candidate is honest, wants 120k and writes down 120k.

Say the company honestly wants candidate ufo 130k or less. Company plays is dishonest card and writes down 110k. Then the candidate leaves and there is no hire. If company had been honest she would have hired a fitting candidate for 125k, less than the most that company was willing to offer (130k).

say the candidate wants 150 but would take as low as 120. so she writes down 120. she's actually worth 150.

the company is willing to hire her at up to 150. But instead, they say 130.

She gets hired at 125 as a result. If they had negotiated, they certainly would have settled closer to 150. Her honesty cost her 12k/yr. The company profits immensely from its dishonesty as long as they say a number just above the candidate's lowest.

I think you're right. Unless both parties are completely ignorant of the others' goals and only play the game once, there is an incentive to lie.

If I don't know what you'll say (and can't play the chances with multiple candidates/employers), I should say what's true. Otherwise, it seems I could expect to gain in any given "game" by raising/lowering my request until I'm at 50% confidence that our ranges will overlap.

Maybe read about game theory a little bit.

> How to avoid the “What is your desired salary?” question

Already off to a bad start. Just like we assume that advertisements without a salary range will be shitty salaries, employers assume applicants who dodge this question have a shitty BATNA. A good answer to this question is "x% more than I'm making now, and high enough to outbid competing offers from companies A, B and C." But if you want to avoid answering the question, a good response is "you advertised at 80k-100k, and that is admissable, but you will need to beat offers from companies A, B and C."

I disagree with the advice on avoiding the "what is your target comp" in current market conditions. Unless the market gets a lot worse- give the number that would make you happy and expect to get it.

Generally, in a startup the last thing I want to spend time on is replacing good engineers because their salary was below market.

In short- If I want to hire the person - I just give them the number they ask for. Recruiting is the worst time sink and better to spend time on retaining the folks you have and improving your business.

One thing Patrick seems to be wholly ignorant of is that engineers, by default, maintain a very high correlation with nonassertiveness and dearth of social skills. Those stereotypes exist for a reason. For most of us, these factors are baked into our essence from childhood, and are virtually impossible to break. In the absence of concrete interaction examples or a corpus of negotiation scripts to analyze, none of his vague advice is useful for many of us.

"One thing Patrick seems to be wholly ignorant of is that engineers..."

It seems far more likely to me that Patrick has made it such a focus for him to share this advice is that he is intensely aware of it, rather than what you said.

Don't get me wrong, I understand and appreciate his motivation, but I doubt he fully comprehends the psychology he's up against. Apologies if I come across as too un-appreciatively negative toward his efforts.

Are you aware that he was (is) a developer himself, long before he became an evangelist of charging more?

Yes, I'm quite aware of this fact. But he's a socially competent developer, and my point still stands about those of us who are not.

Did you come out of the womb knowing how to program or is it something that you spent some time on, reading, practicing, working your way through uncomfortable situations?

Social competency is a skill just like any other and requires practice and learning.

"No true scotsman."

Would you prefer advice from a socially incompetent developer?

If I'm at point A and want to reach point B, I'd value advice from someone who went A->B (and now comfortably sitting at B) more than from someone who is still stuck in A with me.

Perhaps. If one is a socially incompetent developer, it's quite possible that one might find advice from another socially incompetent developer to be more relevant and actionable than advice from a socially competent developer.

Assuming he went from socially incompetent to socially competent. Patio11 seems very much like he is more naturally gifted than the [stereo]typical developer in this respect.

If you go through his blog you'll find that he was a very shy engineer himself who couldn't look people into the eye. I guess we should all understand that there are only very few things / skills that can't be learned.

I completely understand what you're saying: This is exactly why I wrote my book and courses, and why I offer 1-on-1 coaching. And I focus very heavily on providing real tactics, templates, worksheets, scripts, and examples to make the process as transparent as possible.

For example, we talk about "The Dreaded Salary Question". Here's an article I wrote that discusses this question in detail along with what to expect and exactly how to respond: https://fearlesssalarynegotiation.com/the-dreaded-salary-que...

And we go into more detail in this episode.

To put a finer point on it: A lot of the reason I created Fearless Salary Negotiation is specifically to address the factors you mentioned. It's why a lot of my examples in the book involve software developers and related topics.

If I can clarify or elaborate on anything that was vague in the episode, please let me know so I can give more detailed information!

Thanks for your comment!

EDIT: I am on the fence about this, but I think it's extremely pertinent here. I mentioned I coach people and this is a big reason why. If you're a software engineer and you're tentative about negotiating, I can help you. https://fearlesssalarynegotiation.com/coach

Really? While I'm at the point in my career where I don't use the proposed techniques, I think the advice is generally OK-to-good and was anything but vague.

If you identify as non-assertive and aren't interested in compensating for that during negotiations, you're going to get a particular result.

If you identify as non-assertive, but are willing to concretely work against that tendency for an aggregate of fifteen minutes to a max of two hours during negotiations, you're likely to get a much better outcome.

His "vague advice" is very useful. It's a reminder that tech isn't the only thing that employees are selling. And that selling includes an interpersonal component. It can be ignored, but the results will be far from optimal. The best thing for an engineer who underperforms in conversation and negotiation is to realize that there is room to improve and to get moving on doing whatever it takes to have a package to offer that includes technical ability and the social ability to negotiate appropriately.

I'm not even going to touch upon the fact that the skills that a person can use to negotiate more effectively will almost certainly make them a better and more valuable employee (even if they are just a developer/engineer).

Tech workers are not islands unto themselves. The faster they learn this, the better.

Then treat it as an engineering problem. Or be content making less than you should.

Out of the three sections that TFA is broken down into, two of them deal exclusively with how (and why) to improve your negotiation skills, and the third one is roughly 50 percent dedicated to the topic. If dedicating 83 percent of your essay to how and why to overcome "nonassertiveness and a dearth of social skills" isn't enough, exactly how much would be enough?

I personally found his advice extremely actionable, and I'm keenly aware that I struggle more with being assertive in negotiations than probably everyone I've ever worked with.

I'm very sorry if this comes off as insulting, but I have only ever known two developers who really needed much more basic advice than what Patrick is offering here, and I believe that both of them are mentally ill. (One has Asperger's Syndrome, and the other, I strongly suspect, has severe clinical depression which is going undiagnosed and untreated.)

Now, if you are in this situation yourself, it is absolutely worth your time to seek treatment, or at least research and practice using coping mechanisms that apply to the issues that you struggle with most. Seriously, just memorizing a few new sets of behaviors and then "executing the program" in appropriate situations can profoundly improve your quality of life, in ways that go far beyond getting a fatter paycheck.

If you want to discuss any of this with me further, feel free to contact me at afishionado@gmail.com.

Having been on both sides of the hiring process many times, there's some useful tactical ideas in this podcast, but in my experience tactics should only play a small role.

As a candidate for a job, before you go to any interview (even a phone screen) you need to know what the local market salary range is for the type of job in you are applying for. If you don't know that, you're in a position of weakness and any amount of verbal judo isn't going to be useful.

A good hiring manager will not try to cheat you - they will make you a fair and reasonable offer. It might be at the low end of reasonable, but nevertheless it will be reasonable. If they give you a ridiculous lowball, they're not a good hiring manager, and at that point you should just walk away. Even if they come back with a reasonable offer. You don't want to work for a company or a boss that thinks that's ok to do to people.

A good hiring manager will not ask you your current salary. They might ask you early in the process: "what are your salary expectations?". It is acceptable to not name a number and just say something to the effect of "competitive market salary" which should signal to the hiring manager that you know what that range is, as does he, and you're good with that. If you need to give a number, just state range near the top of the local market salary range and move on. Yes, there's a theoretical risk that you've anchored yourself lower than they might pay, but you've anchored yourself at the top of the market range - not exactly a terrible outcome.

Caveat: this advice might not apply when dealing with a recruiter.

Go on 2 interviews a year no matter what.

Always ask for more than you think you'll be able to get.

Ignore talk about culture if they think that makes up for salary - it doesn't.

Re: stock options: I built http://optionvalue.io as a tool to help engineers at startups understand what their options are worth.

Even if you don't know anything about stock options, it will walk you step-by-step through the numbers you need, give you a value, and show you the math behind that number.

I hate salary negotiations. I'm just not good at them. Especially when I'm forced to do it on the phone.

Right now I'm earning a good chunk less than my coworkers with same or lower working experience and it's slightly annoying. On the other side I know of a really good coworker that earns even less than me.

I'm a strong supporter of open salaries. Don't give people who can negotiate better more but implement a system that applies to everyone the same. Take seniority into account, work experience, a base and calculate the salary of every engineer based on that. Fair and open.

I think the most important bit about negotiation that I've learned and read is this: if you're not willing to walk away, your attempts to negotiate will fail. If you're not willing to say "sorry we can't come to a middle ground here" and leave the conversation with no regrets, you'll eventually cave in and lose. (This has been my biggest problem wrt salary negotiations. When I get an offer from a company that I like, I'm almost always unwilling to give it up. Having multiple offers on the table is the best alternative to this.)

Patrick, it seems like this latest episode isn't available on iTunes. Maybe it's related to the error message I see when I load the feed in my browser [0]

> This page contains the following errors:

> error on line 3559 at column 476: Input is not proper UTF-8, indicate encoding ! Bytes: 0xE3 0x81 0xA8 0xE3

[0] http://www.kalzumeus.com/category/podcasts/feed/

It's in iTunes. Sometimes there is a delay for them to crawl the feed. Another issue might be that, if you haven't listened to me recently, your client might not grab updates. (Totally reasonable since nothing was published in several months.)

Josh Doody has been doing great talks on this for a while. Haven't read the article, but I've heard some of his other work. Should be a good read.

Just throw out the number you want, after giving them the clear picture that you think they're more or less making a mistake. Go high. All they can do is counter.

I've seen a salary number printed in the initial job ad. If that number doesn't work for me, I don't pursue the ad. If they ask me for a number, that's the number they get - with the observation that it was printed on the ad.

The problem with more salary is more responsibility. More likely to be cut if you don't perform at the level commensurate with the salary.

Yep, and this really becomes a problem has you advance in years. I'm a programmer and have been for almost 20 years. When you're younger, you are always negotiating upwards. When you're at a job making 70k and you leave, you go to a new job and ask for 80k. But then you're 40 and making a lot more. Now the question as to what you are offered is different. If they're paying you to be a "programmer", can they really justify that huge salary? They can hire multiple college grads for what they're paying you. So it's not so much about your direct programming skill, but your experience/knowledge/wisdom that they are paying for. And each company is going to value that differently.

Your options really come down to whether you want to truly remain a "programmer" in which you may have to make some concessions to compete with the other programmers in the market. Your responsibilities remain that of a programmer. Or you have to take on a manager/director/architect role which is less programming skill and more people management skill with a lot more responsibility.

Arguably, with that much experience, you would make more money consulting.

Instead of being seen as a curmudgeon who could be replaced by four college grads, you're an external, automatically-trusted authority who commands a healthy day rate.

It's just a matter of optics. Though that life isn't for everyone.

Has anyone had much success with negotiating the health care benefits out of the equation? For example, if your spouse carries the benefits, then you don't need them. I'm guessing most employers don't have the luxury of substituting $20k in salary in lieu of healthcare.

Anyone an idea what I can reasonable expect as a student in Germany?

I am working for a company in the Metal industry as a software Developer. I am working very independently.

What a gross, unpleasant world this article describes.

"How to trick everyone in to over-paying and over-compensating you, which you can then use to become even more over-paid and over-compensated as you hop jobs"

I guess "How to break the cycle of greed" probably wouldn't go over too well with them or their target audience.

I've heard that negotiating a higher salary at companies decreases what you can get for bonuses/profit-sharing. Is that true?

It's unlikely to be -EV for you to do so.

Technically, the higher the salary they pay you, the less profit there is to share, so absolutely, a higher salary will reduce the profit sharing. (you can immediately see how this is massively beneficial to you, of course).

Also, your future raises might (or might not) be smaller if you come in on the high end of the range. Some companies have a formulaic "X%" type of system, which means you want to start as high as possible. Others target a ratio to some fictitious "market reference" where a higher initial salary will result in lower future raises, which STILL means you want to start as high as possible.

Some company somewhere no doubt has a policy that works as you describe/fear. The overwhelming majority do not.

Even if it were, it can anchor your next role at a much higher place.

Compare job hopping and seeing 15+% base salary bumps each hop to possible, but not definite (often meager) raises + possible bonuses: rarely is the prospect (gamble) of a bonus worth the career trajectory + salary hit.

I have always been honest with what I'm being compensated. In six years I've nearly doubled my salary.

Why are developers NOT paid proportional to output? A 5x developer should get paid more than a 2x dev but that doesn't seem to happen

> Why are developers NOT paid proportional to output?

Because measuring business value of output of individual developers on a team is not easily done, and other output measures (e.g., SLOC) tend to be things that, if tied to pay, would create obvious adverse incentives.

Indeed. I had an employer that told me my output was too low for the first few years. Then we had a security audit (following an event) and my code was the only code that came through squeaky clean. They didn't talk about the amount of my output after that.

It's not easy to measure the value of someone's work, even years later, and certainly not immediately.

10x engineer: a developer who incurs technical debt so fast he appears more productive than the ten developers tasked with cleaning his mess up. [1]

[1] http://10x.engineer

How do you measure that? Most hard metrics like number of bugs fixed or lines of code are easily abused.

What do you do if you find a security exploit down the road that costs the company thousands but you already paid for his output?

Are we still linking to this snake oil salesman?

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