Why every Australian should know how to negotiate a pay rise
Despite the rapidly rising cost of living, Australians are seeing some of the smallest pay rise rates since the 1940s. While sometimes that’s simply down to businesses not having the necessary funds to give their staff more, a lot of times it’s because some of us are too scared to ask!
The hard truth is that negotiating your pay is a key career skill, so you need to overcome the initial fear in order to get what you deserve. Here are some tips to help you negotiate a pay rise, and why it’s beneficial for both the short and long term. The below info is a guide only and shouldn’t be taken as advice. Do your own research before making any decisions that could affect your financial future.
Tip #1: Research your market value
If your boss came to you today and asked how much you think your job is worth, what would you say? Would you have the latest information on hand to show them that you should be paid more?
Just like jumping into a new work project, preparation is the key to successful negotiation. Jump on SEEK or Indeed and search for job ads that are similar to what you do. Look at the experience required, list of duties, and of course the salary on offer. It’s also a good idea to check the going wage for your job type in Australia; places like Glassdoor and PayScale make this easy for you. Or, check out the information available on Job Outlook; it’s a government website that complies Census data, and can give you some great information about jobs and industries throughout Australia, including typical rates of pay.
When you’ve got all the data you need, print it out and line up a time to speak to your boss, with evidence that you’re worth more than what you’re being paid!
Tip #2: Timing is key
When you want to ask for a pay rise, it’s important to consider all the factors. Yes, you might have evidence that other organisations are paying people more for the same job you’re performing, but your company may be in a very different position financially.
Have there been any recent redundancies or fewer new clients gained by the company? Then your boss may simply not have the funds to approve any raises. On the other hand, if your team has recently won lots of new business or grants, or if you’re scaling up your operations, then this could be the best opportunity to strike while the iron’s hot.
Tip #3: Build and present a case for yourself
So you’ve come into the meeting with a thick folder filled with job ads and evidence that you’re currently underpaid for your role—great! But what else are you going to show your boss?
Asking for a pay rise isn’t just about the money. It’s about what level of service and business knowledge you bring to your position. Make a list of all the reasons why you’re the best person to do your job, and highlight recent events (e.g. milestones, client wins, achievements, etc.) that show you’re going above and beyond your standard duties. You could even put it all into a short visual presentation or a verbal pitch.
Your boss wants you to succeed, and success is often rewarded with a financial raise or promotion. So give them every opportunity to see just how brightly you’re shining in your current role.
Tip #4: Take time to consider their offer
The meeting is over, your boss has had a think and they’ve let you know their response. No matter what their offer is, it’s recommended that you take some time to think it over.
If it’s much higher than you expected, shaking their hand with excitement will likely indicate that they’ve paid you more than you’re worth. If you’re disappointed with their offer, an immediate negative reaction may hinder any opportunity for growth in the future. A day or so later, either accept the pay rise, attempt to negotiate further, or decline their offer and perhaps reconsider your career options.
Tip #5: Beware of sneaky tactics
There are plenty of shady tricks in the book when it comes to pay rise meetings. Beware of bosses who want to delay their decision with comments like, “Next year’s budget hasn’t been approved so I can’t make any financial decisions” or “We’re not thinking about adding more staff until the next financial year, so you’ll have to keep doing the work of two people”. Make sure you have an appropriate and respectful response ready, one that won’t hurt your chances of any pay rises in the future or jeopardise your current role.
Then there’s the real low blow, and one you’ve probably been worried about: “So it sounds like money is the only reason you want to work for us?” This flippant remark can be used to make you feel bad for asking for a pay rise. Instead, respond with something like, “That’s not true, because there are plenty of other companies paying more for the same job type, so if I only wanted more money I would’ve left already.”
What happens if nothing works?
Not every pay rise discussion will end in a positive result. Sometimes, your boss’ hands really will be tied for various reasons beyond their control. In this case, you’ll need to consider what you want for your future. Are you happy to stay as you are or are you tired of working too hard for pay that’s less than what you deserve? If it’s the latter, then it might be time to move on. If you do decide to move on, just make sure you leave on a positive note, work your notice period if you have one, and end your working relationships on good terms. Never burn your bridges as you don’t know what’s around the corner!
In all scenarios, stay positive and be proactive. You may not get a bumper pay rise every time, but you can bolster your importance in the business by working hard and ensuring your boss understands that you know your worth.
While a pay rise can help take the pressure off financially, you can also protect your finances by recognising that sometimes, the unexpected happens. Life insurance can be there to provide your family with financial support if the worst-case scenario was to happen and you passed away. Compare a range of life insurance policies with Choosi today.
4 Sep 2020