Lawyer Transitions: The Art of Negotiation
If successful, negotiations concerning a job offer are only the beginning of a relationship with your new employer. Neither party should leave the table feeling abused, resentful or like it was treated unfairly. Nor do you want to be perceived as overreaching. If done properly, you will have solidified your position as a member of the team.
Offer negotiations start when you first walk through the door to interview with a prospective employer. You should not discuss compensation in an initial interview, and should try to delay those discussions as long as possible during the interviewing process. However, from the very first meeting you should be working on proving your value to the prospective employer by showing how you are the best candidate to fill their needs. This will establish your worth when it comes time to talk about the terms of an offer.
Before you get to the offer stage, you should have done your homework so that you have some idea of what to expect and whether you are in the right ballpark. Research online, talk to colleagues and classmates, and check with recruiters.
You want to be armed with as much of the following information as possible:
• the amount you need to meet your financial needs (this figure does not need to be mentioned, just kept in mind);
• the value of your current (or most recent) compensation package, both total and broken down into its component parts;
• the fair market value for someone with your skills and level of experience in the geographic area and at the size and type of firm or company at which you are interviewing;
• an approximate range of what this particular firm usually pays;
• whether this firm has a lockstep or merit-based compensation system;
• the typical benefits package for this type of employer in this geographic area; and
• your target employer's standard benefits package
When the offer is made, you might not want to negotiate on the spot. Thank the person making the offer, express your pleasure in receiving it and your interest in the position, and ask for time to evaluate the entire compensation package.
YOUR POWER TO NEGOTIATE
When determining your power to negotiate, consider all factors including the state of the economy, the size and financial health of the potential employer, the supply of candidates with backgrounds and credentials similar to yours, how badly and/or quickly this position needs to be filled, and how much you want or need the job. Also, keep in mind the political constraints your potential employer may be facing. They probably cannot bring you in at a salary completely out of line with their current compensation structure, as it will alienate the rest of the team.
If you are bringing a lot to the table, such as new clients, high billing rates and plenty of hours to generate significant new revenues, your potential employer will be more amenable to rewarding you for that. On the other hand, if your economic value is not as great at the outset, you will have less bargaining power. You may want to negotiate a package that shares the risk: a reasonable base with additional compensation predicated on specific threshold results relating to your production. This shows your confidence and willingness to take a risk on yourself. If you don't believe in your ability to produce, why should your potential employer?
THE RIGHT TONE
If you don't intend to accept the offer, do not waste your time or theirs negotiating. Also, don't put potential employers in a bidding war over you. This will leave the impression that money is your most important priority and that you might leave for another opportunity that pays just a little more.
When you are ready to negotiate, don't couch your requests in terms of demands. To establish a level of comfort and trust, start by mentioning those portions of the offer that you find acceptable as presented. Then ask for clarification or further information as necessary, and make requests for concessions in a non-confrontational manner. Be reasonable and realistic, using your market research to back up your requests. Look at ways to be flexible and creative to work with your potential employer to craft a deal that is comfortable for both of you. You need to make an honest assessment of your priorities and what trade-offs you are willing to make in order to gain other, non-monetary benefits in the context of your long-term career goals. Continue to sell yourself and your enthusiasm for the position throughout the negotiation process.
Once your potential employer has made the concessions you originally requested, do not come back and ask for more. You will risk appearing greedy and possibly having the offer rescinded. Remember that offer negotiations are part of the interviewing process. No deal is done until you accept; thus, the offer can be withdrawn at any time up to that point.
Keep discussions on a business, not personal level. Demonstrate why and how you are worth what you are seeking in terms of increased value to the employer. Don't use your personal situation, such as a sick family member, student loans, high cost of living or other hardship, as a bargaining chip. Don't get emotional. A potential employer's unwillingness or inability to meet your requirements is not a rejection of you as a person or even, necessarily, as a future employee.
Aim for a win-win situation. Use the word "we" whenever possible to show that you are on the same side, working together to reach a solution that satisfies everyone's needs. A candidate who pushes too long and hard demonstrates an unwillingness to be a team player. You don't want to win the battle, but lose the war. On the other hand, you don't want to be a pushover, because how you handle this negotiation might be viewed as a demonstration of how you will negotiate on behalf of the firm's clients.
GET IT IN WRITING
When all is said and done and you have reached a mutual understanding, ask to get the agreement in writing, or write a letter confirming your understanding of the agreement. On the other hand, if, after careful consideration, you determine that you cannot accept the offer after completing good faith negotiations, let the firm know as soon as possible. Express your appreciation for the offer and say that you hope to keep the door open for future opportunities to work together.
Read articles in the "Lawyer Transitions" series:
- Lawyer Transitions: Money Isn't Everything
- Lawyer Transitions: The Art of Negotiation
- Lawyer Transitions: Talking About Compensation
- Lawyer Transitions: What's on the Negotiating Table?
- Lawyer Transitions: Figuring Out Multiple Offers
- Lawyer Transitions: Giving Notice Without Burning Bridges
- Lawyer Transitions: Encountering Counteroffers
- Lawyer Transitions: It's Time to Go
- Lawyer Transitions: How to Succeed in Your New Job