(Bloomberg Opinion) -- When negotiating a raise, timing matters. Typically, it’s best to ask before annual budgets are locked and to steer clear of Monday mornings when the boss may be cranky.
But in a pandemic-led recession? It's awkward, for sure, but it's not an impossible task.
With unemployment in the U.S. exceeding 10% and average jobless claims running over one million per week, you may be grateful to just have a spot on your company’s payroll. Asking for a higher salary now can feel inappropriate or downright greedy.
But, let’s remember: You’re not the only one who should feel fortunate. Your company is benefiting from your contributions and, with your support, navigating its way through a challenging time.
If you had a convincing case for a raise back in January, and you’ve continued to overproduce and work longer days, don’t give up. This could still be your year to make more.
The approach: Prepare to ask as you would in a “normal” economy, while being hyper-conscious of the current environment with these steps.
Quantify your (most recent) contributions. If your performance was stellar at your company last year, great. But how’s 2020 faring?
In a pay raise discussion, highlighting your measurable contributions from the past year or two to prove your worth is standard. But at a time when so many companies, including yours, may be pivoting or changing business models, it’s more convincing to point out recent accomplishments. Focus on the last four to six months and how your innovation, flexibility and leadership has held up the company and enhanced the bottom line.
For example: Cite the new accounts you landed this summer that brought in tens of thousands of dollars or more, the software program you developed in a pinch that led to immediate cost savings or the SEO tweaks you implemented that drove more traffic and sales.
Propose pay “triggers.” If you sense hesitation from your employer to bump up your pay now — despite your recent wins — suggest earning incrementally more if and when specific goals are met from here on out, sort of like a commission. “Design some triggers for increasing income,” suggests Georgia Lee Hussey, who runs the firm Modernist Financial in Portland, Oregon. “If you met this stretch goal that would produce this much revenue, maybe you could get a piece of it,” she says.
In uncertain times, employers may be more comfortable tying compensation to real revenue results to limit risk. Plus, it creates a clearer win-win scenario and demonstrates that proactiveness on your part. “It makes it harder to say no,” says Hussey.
For example, let’s say you run admissions at a school and managed to increase online enrollment this summer. If your boss still resists raising your pay, suggest that if you attract a certain number of students for the next term, you receive a 15% pay bump (or whatever you think is fair), which is just a fraction of the enrollment revenue.
Mind the layoffs. If your company recently downsized, furloughed or announced a hiring freeze, hold off on salary discussions for a bit. Wait at least a month or two to let the dust settle. Otherwise your boss can easily brush off your request for a raise, even though you may well deserve it.
If your company is still standing months later and has since shown signs of growth by, say, making a new hire, expanding a line of business or acquiring assets, your manager can’t simply say there’s no room in the budget. In fact, for many companies, June was a pivotal time, with small and medium-sized businesses reporting an uptick in hiring after months of furloughs and freezes.
And there’s a good chance you may be doing more work for the same amount of money since the layoffs, as your company’s gotten leaner. At this point, you can, with more confidence, proceed to ask for a 10 or 15% raise to help compensate for all your extra work in the aftermath.
Prepare to ask for more than just money. Often my advice for anyone who asks for a raise but fails to get it is: Do not leave the negotiation empty-handed.
If your company can’t swing a salary hike, how about a stipend for childcare so that you can continue to focus on work while your children are home this fall from school? And while we’re at it, if your corporate benefits are lagging, how about a proper flex-spending account? A short-term disability plan? Maybe you can even negotiate every other Friday off to better manage the home front?
More money is ideal, but gaining back some time and sanity can prove invaluable — now more than ever.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Farnoosh Torabi is a financial journalist, author and host of the "So Money" podcast.
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