Another disappointment in the annual review. No pay raise once again. The salary has been frozen for recent years while there are more responsibilities on your shoulders. You truly feel you deserve a pay raise but it never comes. You begin to wonder: Is it the time to actively ask for a raise? How to ask for a raise?
But you are hesitant, fearing you can’t get the desired raise and ruin the relationships between you and the seniors. You are also concerned about how your colleagues would think of you when they hear your request.
Instead, you shouldn’t worry, and you should go for it!
Do your homework before asking for a raise.
Here are all the do’s and don’ts in demanding a pay raise.
1. Find the best timing to request.
Most people ask for their pay raise during the annual review period and get rejected. You may think you’re rejected because you do not deserve a raise in their eyes, but the truth is – It is TOO LATE.
As early as 3 to 4 months before an annual review, the seniors have to plan the coming fiscal year’s budget. And most importantly, the budget includes the sum of raises and salary adjustments. So, if you demand a raise in an annual review, the budget is already fixed and you usually can’t get the raise. Request a few months in advance instead!
Besides, analyzing the current status of the company is crucial. Imagine you still ask for a raise when the company is experiencing stagnant or even negative growth, it would be a disaster.
On the other hand, if the company’s financial growth is on the rise and has recorded greens in consecutive seasons, then it is your opportunity! Your boss is more than willing to reward everyone who makes the growth possible (if your boss is a nice and generous one).
2. Maximize your bargaining power.
There are a few things you have to know and prepare before your request.
How much your colleagues of the same rank are earning?
Knowing the salaries of your colleagues is important. You have to know the discrepancy between yours and theirs to request for a reasonable raise. Otherwise, you will sound greedy. You won’t want it to happen.
What are your accomplishments and contributions?
Keep a detailed and specific log of how your have added values to the company. State the nature of the project or task clearly and how successful it is. It is also important to mention how your contributions have helped the company to grow.
You have to be clear and specific about your accomplishments because your boss has to take care of so many matters. He/she really needs your reminders to recall your contributions.
What are your responsibilities and duties?
You have probably looked into what your colleagues are doing and it’s important to compare the responsibilities you and your colleagues have.
Having more duties should probably earn more. If you happen to earn less by doing more than your counterparts, it is perhaps the time to ask for a raise.
3. Know the amount you should ask for.
There are no norms for how much a raise should be. It varies greatly across industries and companies. While a rapidly growing startup can review salaries on a quarterly basis, a well-established multinational company may do so yearly.
However, there are some suggestions on how much a raise you should be requesting.
- If there is a promotion in rank, around 10% rise in salary is reasonable.
- If you stay in the same position, it is advised not to ask for more than 3% raise.
If not carefully requested, you may end up appearing ignorant or greedy.
4. Rehearse what you are going to say in front of your seniors.
It is highly advised to rehearse the meeting beforehand.
Try to play the role of your boss and yourself, and think of the questions you will be dealing with. It is likely that you’ll be asked for the reason to raise your salary. If you practiced well, you should have a nice and convincing answer.
It may sound weird but this rehearsal can worth a few hundreds or even thousands of money. Think about it.
Talk politely and skillfully during the meeting.
Now you’re well-prepared, here are a few more pointers to help you during the meeting.
5. Get straight to the point.
You have clearly stated the purpose of the meeting and it’s best to be on point. Go straight to the topic as you have prepared. Tell your seniors your positive impact to the company and everything you know that are proof to your below average salary.
6. Mention your ambition and loyalty to the company’s future.
Seniors love to see your devotion to company. In spite of talking about how much you worth, also mention what you have planned for the future and your prospect in the company.
Talk about how you wish to help the company. It is also good to stress your commitment to the company.
7. Don’t suggest counter-offers or threats.
Sometimes, you are offered a raise but not exactly the amount you desire. Remember, don’t make any counter-offers and threats about quitting. You are here trying to look for a win-win situation.
Don’t make it into a lethal negotiation where both you and the seniors feel the uncomfortable tension. Things usually go more smoothly in a harmonious setting.
8. Don’t complain about your current job situation.
Maintain a positive tone throughout the meeting. Imagine if you were the boss, would you like to hear “I have been working here for 4 years. While I am having to do more, I have nothing more in return!”?
Remember you are here to request for a pay raise and you need the boss’ support to do so. Don’t piss anyone off and ruin your future.
9. Prepare for rejection.
Prepare to receive a cruel rejection from your boss. Instead of a promotion in position or a raise in salary, you may also suggest looking into the options of incentives, bonuses or stock options.
Also, it is good to ask for an interim performance appraisal. It may be that your performance is not impressive enough at the moment but your boss definitely sees your efforts and progress. A raise could be happening anytime in the future.
If, unfortunately, everything is rejected, it is still fine. It is good to ask about rooms for improvement because you may have overlooked some of your accomplishments and performances.
Don’t be deterred by refusal. After all, if you don’t even ask at all, you won’t stand the slightest chance to have a raise.