In Pursuit of Profit
Read our expert article below or sign up to get articles sent to your inbox.
I wager many of you have gone through this scenario: You find a job that sounds great and start the interview process. Before you know it, you’re multiple interview rounds in (possibly even to the offer stage) and then you find out that the compensation isn’t a fit. You’ve wasted your time, and the company has wasted theirs.
Scenarios like this are why it is imperative to get clear on compensation expectations and details early and often in a job seeking process to avoid wasting time. So, how should you think about money in your job search?
As an accounting recruiter, it has always been an important topic to address. Having had hundreds of “comp talks” with candidates and hiring managers, I want to walk you through how I believe it’s best to approach compensation. First, we need to define the pieces of compensation:
Components of Compensation
There are multiple parts to a compensation package – some obvious and straight forward, others not so much. Combined, these all comprise “total compensation” – or every part of a compensation package that can be assigned a dollar value. Included below is a list of what most companies include.
Base Salary – your yearly cash wages. This one is pretty simple and is what most people focus on because it comprises the majority of people’s total compensation and allows them to pay their monthly bills.
Bonus – additional cash compensation usually paid out yearly (although some companies pay more often) and usually as an incentive for good performance. Some jobs have bonuses, some don’t. Bonuses can be a prescribed flat dollar amount or a percentage of one’s base salary. They can be guaranteed but are usually incentive based, meaning they’re a function of performance (either personal, company or both).
Time Off – days off work allotted for vacation, sick, personal, bereavement and jury duty usage. Also includes maternity/paternity time off and some other longer stretches. Most everyone values time off because we all need it (and some of us even use it!). If you think of it as being paid not to work, it can help you understand why it’s such an important piece of total compensation. It usually comes in one of two forms:
Healthcare Benefits – health coverage provided by employers, which typically includes medical, dental, and vision. Usually, each coverage type is provided by a different provider, so it’s important to understand and evaluate each offering independently. There are two main aspects for each plan that can affect your total compensation.
Equity – ownership in the company given as part of a compensation package. If you’re fortunate enough to be considering a role that is offering equity, it’s best to do as much research as possible on the type of equity being offered to understand when and how you can value it as part of your compensation. There are types of equity that don’t ever become realizable, while some have a set vesting schedule and ownership (and value) transfers in a predictable way. Common types of equity include Restricted Stock Units (RSU’s) and Stock Options.
Other – other unclassified “fringe benefits” that are offered. These types of additional benefits can be hugely valuable to certain people. Examples that can be valued when calculating total compensation include:
What’s Important to You?
Now that we’ve defined the components of compensation, it’s time to sit down and think through what’s important to you before you begin your job search. Perhaps you stack rank what pieces are most to least important to you. Or perhaps you go a little deeper and figure out your min/max for each piece. Every hiring scenario and company will be different, so understanding what you want to ask for, where you want to push back, and where you are willing to negotiate is crucial.
Now you have the easy part out of the way. Knowing how and when to address compensation during the interview and offer process is the most difficult part.
How & When to Bring It Up
It can be difficult and awkward to talk about compensation during the job seeking process. Whether your questions come at the very beginning before applying for a role, at the very end while negotiating final pieces of a job offer, or somewhere in between, the topic needs to be handled with care. Knowing the right timing, tone, word choice and with whom to speak is imperative to communicating what you’re looking for in the way of total compensation.
Unfortunately, there is no catchy phrase to remember or acronym to memorize to help you through this process. It is very nuanced because, well, money is a very sensitive topic. But there are some simple ground rules to keep in mind to help gather as much information as possible and to communicate:
Ask Early – As early as possible ask for details of base salary and bonus without making it seem as if money is all that matters. You can state that you just want to make sure both parties are in the same ballpark. If a company’s maximum does not meet your minimum, then it’s likely not worth your time applying or interviewing.
Wait a Bit to Ask, But Not Too Long – Many people make the mistake of not receiving medical plan, time off, and other benefit details until very late in the process because companies are usually wary of sharing the details of these plans unless they feel they have a viable candidate in process. However, I’ve seen the details of these plans make or break job offers, so it’s important to get all the details in the middle of the interview process, not at the end.
Use “At Least” Phrasing – Do not state a base salary range that you’d like. Hiring managers almost always hear the low number while candidates almost always want closer to the high number. Instead, use the phrase “at least” and pick a number within the acceptable range you would be happy to accept.
Find out Who to Ask – Both HR and the hiring manager should be equally capable of discussing compensation. If you’re not sure who the right person is, it’s ok to ask that too because it shows respectfulness and proactiveness.
Know How to Bring it Up – Take a tone of wanting to be on the same page when bringing it up instead of coming across like you’re making your demands known. Be explicit about your curiosity about details by explaining this is potentially a big decision and you’d like all the information to appropriately assess the opportunity. Talk about it at the end of interviews/discussions. Bringing it up at the beginning or early on in an interview can make you come across as too money motivated, which is a turn-off to most employers.
Important Questions to Ask
You can use these question prompts for each area of compensation:
Benefits of Using a Recruiter
Still anxious? There’s no doubt that talking to a potential future employer about compensation is difficult. Even accounting and finance professionals have a hard time because there is so much nuance involved around timing, tone, word choice, knowing who to speak with and more. It’s natural to not want to take this on yourself and just focus on the interview process. This is a great reason to utilize a recruiter – we’re experts at talking about compensation. We get to thoroughly understand candidates’ needs and motivations. We know all the details of our clients’ plans and we act as your agent throughout the entire interview and offer process to get you the best possible total compensation package. Contact us if you’d like us to represent you!
About the Author
Quinn Finnigan - Recruiting Services Leader, The ASP Team
Quinn is a native Washingtonian, born and raised in Tacoma and Lakewood. Having lived and traveled all over the world with stints in Portland, OR, Salzburg, Austria and Maui, HI, he returned to his roots in 2008 and now lives with his wife and two children in Issaquah. A proud alumnus of The University of Portland, Quinn received his undergraduate degree in accounting and began his career at Deloitte in the audit practice. Later he worked in corporate accounting and finance working for the Seattle Seahawks and Amazon. In 2015 Quinn actively sought out the Accounting and Finance recruiting industry and has been serving Puget Sound based middle market companies ever since.