Pushing Back on Personal Research

It's not unusual in the recruiting process for a candidate to balk at the company's initial salary offer. Sometimes in their pushback they might say that, having conducted a bit of "research" they feel that their personal value, or perhaps the company's job pricing, should be greater than what's on the table.

How should a Manager respond?

Before the advent of the internet companies were seldom challenged over how they priced their jobs. The value of a candidate's background and experience might be negotiated, and often was, but not the internal value of the position itself. These days the wealth of information now available online offers interested parties an opportunity to attempt their own investigation, to analyze what a company's job is supposedly worth in the real world.

What do you say when a candidate tells you that your $70,000 job should be priced at $80,000?

What a Manager Should Know

If you haven't been hit with this scenario yet, consider yourself lucky. But it will happen. The challenge could even come from an existing employee, one who feels that they're being undervalued for their responsibilities.

So how good is that "research" you've been told about? Can you take it to the bank, or should it go to the trash pile instead? First of all, the online data sources most often quoted are frequently criticized as unreliable, inaccurate and are seldom used by compensation professionals to base their program recommendations. These sources often use data provided by the employees themselves, and may lack adequate filters to assure proper job matches. Data collection techniques are often challenged by compensation practitioners.

Some sources can be self-serving, especially those sponsored by firms tied to the staffing industry. Reporting higher salaries would benefit them in the form of higher fees.

These sources are also convenient and inexpensive, increasing their popularity. But quality costs; you get what you pay for. Here you get straight arithmetic, plain and simple. The data cannot know the internal importance of a specific job within an organization. It cannot interpret, cannot assign subjective values the way company decision-makers do when assigning a grade among peers, among like valued jobs. Thus it's easy to miss the mark by not understanding the company's job in terms of true market comparators.

So How Should the Manager Respond?

When you're exposed to this personal research tactic, step with care. Your willingness to debate the issue hands at least a partial victory to the challenger, who will no doubt boast far and wide about their successful "strategy." So if you engage, be prepared for more of this as word spreads. Avoid playing defense.

You might consider other possible reactions.

• I didn't hear you: As suggested above, ignore the gambit, refusing to engage in speculation, as discussing the matter gives a degree of credence to the challenger's viewpoint. Simply state your confidence that the job has been properly priced - then drop it.

• The pushback: You could ask, what are their professional credentials for such research, as your company uses compensation professionals to keep pay levels abreast of the market.

• Pushback II: You could challenge the "research", but that gives more credence to the point being made. Likely you won't win the argument, as whatever you say would be viewed with skepticism.

• I'll pass: You could skirt the issue and refer to HR, saying that you'll "have them take a look." This fools no one, but it does provide the opportunity to move the conversation in a different direction. Note: this will not work with an external candidate trying to negotiate.

Your reality is that the company has already determined the value of the subject job, and will not welcome outside second opinions. The job has a grade, a salary range and a midpoint - none of which will be changed because someone claims to have done a better job of "researching" how it should be valued.

I'd recommend the "I didn't hear you" response, and be firm.

Btw, when managers and executives have asked me which sources should they use to research the market value of the job they're interviewing for, I tell them, "Don't do it."

Do they really think that the company is going to listen?

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a clowder of cats.

Creative Commons image, "Bureaucrat," by Delmarva Dealings

Comments

[Harold]

Your recommended approach will be useful if I ever have to work in employee compensation management in Russia . Thanks.

[Jay Schuster]

The reward strategy then is, "Protect the Midpoint at all costs because it is sacred, true, and wonderful".

Is that better than protecting the 'average' of what the three companies down the street pay???

Goodness Me!!

[E. James (Jim) Brennan]

There are as many competitive salaries as there are employees at competing enterprises. Some pay high, some pay low. Some have one person performing the function, others have a dozen doing discrete parts of the total function. And there is cash alone versus total rewards, too. Each organization decides what it will pay for KSAs or titles or resumes or whatever, and they all make different choices. But pay is always established at levels each outfit feels are appropriate and proper for itself.

Outsiders don't get to change internal rules until they become the executives controlling those rules. If the pay rates appreciated by current incumbents are unacceptable, candidates should decline and seek those other superior employee value propositions.

[E. James (Jim) Brennan]

P.S. How many people pay the full sticker price for a new car? Seems like there is little difference in the dynamics, except one is an egocentric situation and the other a purely commercial negotiation.

[David Chambers]

This is a common scenario both from prospects as well as existing employees. The Hiring Manager should know the remit to negotiate and also have a clear rationale for the parameters of the same and the offered package. Reward need to ensure Hiring Managers are able to articulate the full proposition (not just compensation, but at least the TR package or 'deal') and are able to discuss the 'market research' basics, i.e. the difference between recruiter data (people generally move for 10 to 20% increase and that biases the data considerably) or anecdotal non-verified sources such as Glassdoor, and proper data, of using market median based on relevant organisations, using actual salaries. Ultimately if the candidate is requesting a salary beyond what offered, then the question of "what is it about you and your achievements that would justify a salary beyond that offered?" shifts the chat from spurious data, to one of actual value of the individual...and will be better appreciated (in my experience) than passing it to HR or ignoring it altogether.

[Warren Antonik]

Ultimately candidates can claim anything. The range placed on a job by a company is an amalgam of considerations from content of the role through to affordability. The offer the line manager strikes will consider the range but it will also consider the relative value of the candidate. Both parties can then choose to negotiate or not. The company will want to pay a fair price. I think we've moved away from the days when companies low ball an offer. It just creates problems for the future. The candidate will seek to maximise the outcome. That's fair enough too. The key to negotiating is get the other side to see the inherent value of what is being offered. I don't think involves showing each other reams of data.