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I don't think taking away the ability to negotiate from either the employer or the candidate makes sense. But I do understand why people are looking at this. Not only can it be more difficult for some to negotiate due to background, personality traits, etc.; there are some who view woman who negotiate negatively while admiring that same behavior in men. While I don't think this is the ultimate answer, I'm glad the discussions about how to fix this have started.


So good to hear from you - always great to have Cafe alumni weighing in!

I'm in your boat - another issue fraught with complexity, with no easy answer, but experimentation and discussion are the way we figure our way through these things!

Darcy and Ann - I'll go one step further, in that, there is no answer to this issue. There needs to be diversity in pay due to the diversity of people's experience, education, knowledge, skills, abilities, certifications, performance, etc., in my opinion. Oh, and I'll bet the house that if, or when, Ellen is being further considered for the CEO position, and if she is worth her weight in salt, that there is going to be some negotiations on pay and incentives, or will she just except that the BOD will come up with "fair" pay?

A narrower band within which negotiation is permitted makes much sense, if supporting data permits it. Especially when the position requires the exercise of negotiating skills and the employer is less than omniscient about the value of the talent sought.

The success of such restricted diversity policies is of course contingent on the wealth of the employer. The more generous the overall pay levels of the enterprise, the more feasible such changes can be. The lower their pay structures, the more good talented candidates will reject their paltry offers. If they can initially offer handsome rates, few will be disappointed at any constraints on negotiating room.

Most recent negotiation I've know about was interesting. We were hiring 2 temps, a gentleman and a lady. The gentleman negotiated and the lady didn't. He got partial of what he wanted but now that they are both working, we realized that, her work was of better quality and value. Does this mean they went back and fixed the comp? Nope, he is still overpaid (based on the value that he brings).

Was it her fault for not negotiating? Maybe. Is that fair? Probably not. Is someone doing something to fix it? Nope. Personally as a comp person, I would have not let that negotiation to fly. Mostly because I know specifically how much the job is paid and we shouldn't be paying more then the range it was intended. But again, I can only recommend and ultimately, it's TPTB's decision. Worse, they are suger coating and making excuses for his incompetence.

My pet peeve, paying extra when they are not even at full competencies. I guess I am a Scrooge.

My question is, in your respective organization and experiences, when you see a disrepency like this, do you go back and fix it or let it ride? Are we (compensation/HR people) part of the solution or part of the problem?

Ann, the issue of pay negotiations between employer and employee has profound implications for those of us in the compensation field. Notwithstanding what may, in fact, be the broader pay transparency/pay equity movement, I can make an argument for the employer determining salary rates at point-of-hire for many jobs as not being subject to negotiation, but allowing for negotiation in establishing individual incentive plan arrangements. Regarding salary offers for new hires, it may well be that the employer can reasonably estimate the economic return from having any beginning employee perform the given job, and can set a single rate in recognition of this likely value. Since the at-hire performance value to the employer is not likely to vary significantly across potential job candidates, regardless of differences in their credentials/ qualifications, there is no upside to opening up the starting salary rate to negotiation.

On the other hand, there is justification for a negotiation process in fashioning an individual incentive plan. In particular, I believe the effectiveness of these incentive plans would be enhanced by facilitating a “bargaining exercise’ between employer and employee over the exchange of payout amounts for levels of results produced. Plan success often depends on inducing the employee to expend the necessary effort toward achieving performance outcomes. Unless the employee perceives a fair exchange of reward for effort, they are likely to reject the plan. It is in the interest of both parties to reach an acceptable agreement (i.e., an optimal compromise) on the incentive arrangements, rather than simply having the employer unilaterally design the plan and implement it on a “take it or leave it” basis. As compensation practitioners, it would behoove us to serve as the intermediary (i.e., “go-between”) for these negotiations between employer and employee. Please see my (shameless self-reference alert) 2011-Q4 article in WorldatWork Journal on “Side Agreement Facilitation: An Intermediary Role for the Compensation Professional”. Great blog.


Great point - and I'd be willing to make that bet as well!


Agree that a narrower defined band for negotiation may make sense. And yes, hard to deny that there could be a link to employer wealth/affordability.


Thanks for sharing your very interesting and relevant example - good food for thought. I'm sure there are cases where we are as much part of the problem as the solution - but hard to contribute to the solution when we only discover these situations after they are a fait accompli!


Interesting proposition to consider - thanks for sharing the reference to your article here for readers who'd like to learn more.

Wow, lots of activity and discussion for a Friday.

My prior employer had a no-negotiation policy, which seemingly worked well - although on my first exposure to this policy more than 20 years ago, I was pretty young and naive (now I'm just old and naive . . .). Back then, the policy was driven less by gender differences, and more out of concern for disadvantaging the inexperienced new college graduates (and their relative negotiating skills), and the more experienced careerists. So, whether that was to correct for inability to negotiate or unwillingness to negotiate, maybe that policy was (unwittingly) ahead of its time.

Was the employer disadvantaged, by how many folks we "lost", by not negotiating? We didn't hire huge numbers in my 10 years there, but I looked at my records, and out of the 211 folks I developed salary offers for, 198 of those were accepted (I was one of five comp folks on staff). Admittedly, some of those acceptances came in at literally the "11th hour" - on the assumption we actually would negotiate (we didn't).

And I'm not sure that pay transparency (at hire) will obviate pay differentiation (post-hire), since there's some belief that as "big data" becomes more prevalent, pay transparency may just be being confused with greater awareness of what constitutes competitive pay levels - and more universal availability of that information for employers and employees.


Thanks for throwing in - interesting experience and great insights. Good point about the eventual convergence of pay transparency and "big data." We may end up at a place few of us anticipated. But that's the fun, right (she said, trying to sound convincing....)?

While nothing in what we do is ever "case closed" I think I've covered this waterfront before...


Thanks for the reminder, Tony. Yes, please all click through and read/re-read Tony's guest post for a thoughtful and detailed treatment of a lot of what we're discussing here.

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