Offer rescinded after negotiating salary
hey monkeys, I got an offer rescinded after I tried negotiating the compensation. HR said the MD was unhappy about it and advised me to move on since it was a bad start to the working relationship.
Any advice on how to approach it in the future? I honestly think I did it in a polite and respectful manner. But the conversations with HR went back and forth for a while and I guess the MD got pissed and decided to pull it.
Quite upset about losing the offer as I am stuck in a BO role trying to escape. Managed to get this one FO role after a YEAR of searching :(
Simple, don't negotiate when you have no leverage
Does leverage mean having another offer?
Yeah. Or a current job you're happy to stay in.
Also, I am assuming this was for a junior role, I have never heard of negotiating junior pay at banks because of how standard it is. Especially don't try to negotiate jumping from BO to FO. That is hard as hell to do as it is
if you don't have leverage, then you can really only ask "is this total comp package the best you can do?"
and i would advise only asking once. If you have leverage (a better offer elsewhere, or a current job that is better than what they are offering), then you can negotiate and ask them to beat your other opportunities....but if you don't have that leverage, then you are playing with fire (and risk getting burned).
Negotiating is not my strongest skill and I always err on the side of caution, i.e. I'm careful not to look too aggressive or over-entitled, especially when nego-ing.
Sorry if this is going over my head but how would you actually phrase, "is this total comp package the best you can do?" I would not be able to pull that off. Sounds easier to pull off when you know you have other options waiting, but akin to a bluffing game otherwise. In any case, any other tips for how to be firm (agree that no one else will watch our back) without overdoing it?
Note to future self ...
note to future self
bruh
Some of this is mentioned above, but generally:
1) It's rarely a good idea to negotiate for structured analyst programs. Pay is standardized and it can deplete a lot of good will before you walk in the door. It's probably more acceptable to negotiate for junior roles where you don't enter as part of a class into an analyst/assoc. program. YMMV.
2) If you don't have any leverage (ie a competitive alternative), you need to limit yourself to one ask at most. Even if you do have leverage, you need to read your counterparty's willingness for a back-and-forth negotiation. If they're not enthusiastically engaged, get to a best/final offer quickly and just accept or decline.
The above said, this MD just strikes me as a huge a-hole. I get that FO roles require people who understand the nuances of business etiquette, but pulling an offer from a 20-something to prove a point just screams Napoleon Complex.
If I was OP, I'd write him a letter. Thank him for the opportunity and apologize for overstepping and overestimating your value. Acknowledge it was a costly lesson to learn, but a valuable one that you'll keep with you. The offer probably won't be reinstated, and you shouldn't even hint that's what you want. But who knows, maybe you'll stroke this d-bag's ego enough that he reconsiders, or recommends you to someone else. Worst case, you'll have done some reputational damage control before you move on to the next opportunity.
Thanks for the detailed reply. This happened 2 weeks back. Is it a little late to be emailing the MD?
Yes, I personally don't think I can get along with the MD. But then again I am a BO guy trying to make it to the FO, can't be choosy.
Yes, I may have overstepped. But I thought HR would just come back with a "that's all we can do, take it or leave it". Instead, it was just "we are taking the offer back and are unhappy about how the negotiations have taken place"
Can't hurt. Would even suggest sending him a typed letter instead of an email.
You're going to work for some jerks over the course of your career, especially in this business. Not much you can do about it, particularly at junior levels.
You mention below that you sent market data to HR as part of your negotiation. That's not usually a productive way to negotiate (exceptions certainly exist). The HR dept of a major financial institution isn't looking for you to educate them. If the offer is below market, they probably know it. And salary negotiation isn't an exercise in proving facts - it's trying to convince the other party that your offer is worth their while. Waving data in HR's face just does two things. 1) It accuses them of low-balling you, and 2) It tells them you'd be disgruntled working for them at that figure. You can see why they'd rather not bring someone on board after receiving that message.
Agree with all your points here except for the MD sounding like an a-hole. The OP said the conversation with HR went back and forth for a while, which is very unusual at the junior levels. These are not revenue generating positions, little to no direct experience is required, the pool of applicants is usually pretty deep, thus each applicant is easily replaceable.
Im going to make a few assumptions here.
1) I’m assuming HR based the offered comp for the FO role on OP’s comp in the BO role.
2) While the offered comp may have been lower than the comp for the typical applicant in this role, it probably still was a comp upgrade compared to the BO role.
3) Finally, given that this is a junior role, the delta between the offered comp and the comp that the OP felt was deserved was probably less than $25k.
A lot of assumptions here but again comp for juniors at banks are fairly standard and with little room to negotiate so this can’t be too far off.
From MD’s perspective, this is a classic case of overplaying your hand demonstrating short sightedness and low business acumen. Compared to most junior applicants who have been made an offer, OP has been substantially more difficult while being offered a tremendous upgrade in career trajectory, being given a raise, bringing limited immediately useful skills/knowledge to the table all over a small amount of money that would be inconsequential over the long run if the OP was reasonably competent in the new role. Why not just move on to the next eager candidate?
My point here is not to crap on the OP. It just seems like OP didn’t see the bigger picture and I don’t think the MD was in the wrong.
OP, best of luck. I hope everything works out and you’re laughing about this experience in a couple years.
Thanks on further reflection. Yes, I may have overstepped. Hope I would come back many years down the road and laugh at this.
Point 1) is correct. Point 2) isn't. I was simply offered my current pay. It was not an upgrade at all. And that's where the back and forth began.
Totally disagree with your sentiment but agree with your assessment.
It is true that HR takes into consideration the current compensation of an applicant when extending the offer. They do frequently look for "good deals," so to speak.
This is entirely inappropriate. It creates friction within a group, animosity and shows that the organization doesn't care about your professional development in the long run. They simply want to squeeze you, like a resource, to maximize what they can get from you.
Let me make my position more clear: Individual A and Individual B should be paid the same amount for the same work, all other things equal. Individual A should not be paid a 25% premium to Individual B simply because he/she was paid more in the prior position.
If you dont believe that Individual B is qualified based on his/her prior work experience, then dont extend an offer. Its just stupid to attempt to hire him/her at a massive discount to the market rate. I've never seen that end well.
I've been there. I know people that have been there, and it doesn't work.
Conclusion: never, ever, tell HR how much you make. Always give them a range of how much you expect to make given the responsibilities associated with the position. If they press you, lie. It's none of their business. They have no right to press you, and you should never be in a position to negotiate against yourself.
I fee like in junior roles, your best negotiation tactic is knowing the market. Don't ask above the range, and don't accept below it. And be prepared with this information, because I guess negotiation tactic 1b would be, respond with that high number at the beginning of negotiations when asked if you feel you have the resume to back it up. This is your best bet to gain momentum for what you want.
Can't go high if you don't have the skills/resume, because even if the company would accept, you don't want to price yourself out in the market. But, if they offer lower than market range, that's just a good signal that it might not be worth it. And if you don't fit the range at all, then maybe you need to look elsewhere. Some companies will start out high, and that's a good thing.
Thanks for the reply. Yes that first offer that came our from HR was a clear low ball offer. I had the stats to back them up. I emailed HR the stats and that's when the problem began. But since I am from the BO trying to get into a FO role, maybe I shouldn't have done that. Oh well, it's all over anyway just going back to hunting.
Was the offer lower than the low end of market?
has happened to be three times over the course of my career... you are not alone. And don't beat yourself up about it - you never know the real reason why it happened. For example, first time it happened for me - the entire group ended up collapsing, second time - there was another candidate with a personal connection to the partners who had no relevant experience, third time it happened - the private equity fund was on the verge of going bankrupt and was hiring to sell all its assets and get cash... don't beat yourself up. Wall Street is rough and tumble. Just jump right back up and keep fighting...
Thank you. None of the circumstances were of your doing. Hope that it worked out for you.
a year of looking is tough - but its not unusual - very common these days, particularly the older you get.
This quote always inspires me:
"She was unstoppable, not because she didn't have failures or doubts, but because she continued on despite them." - Beau Taplin
We only get your side of the story, but even so, this quote is all I need to know.
Sure they probably were under market, but you cannot go back and forth multiple times for what seems to be a comparatively junior role while you're in the BO and will add zero value as you ramp up and try to learn the new FO role.
In other words, you fucked up.
Yeap, I admit I fucked up. Am not on here to get others to tell me I am right. Am asking for advice on how to improve going forward.
The answer I found is - make 1 ask. And either make a decision based on that. No further asks.
Your got two very important things wrong here ...
If you were still negotiating compensation, you didn’t have an offer. You had an indication of an offer.
The sentence “.. the conversations with HR went back and forth for a while ..” speaks volumes.
In today’s job market, most firms have a pretty good idea of both how much a job is worth and how much they are prepared to offer. If you are going back and forth more than 3 times and not discussing something like the disposition of outstanding stock options, something is wrong. Either you are sticking at an unrealistic number or they aren’t paying more than X dollars below what you are asking.
If you are out of work, you have less leverage but any firm that bases their offer on this is worth a pause before joining.
There are lots of “rules for negotiating salary” but most are crap. There are only two rules IMHO.
One last thing .. you only have an offer when it’s written down and signed by both parties. You only have a job after you start.
This is going to come across harsh because it's like sending a text and you can't see the emotion, but it is pretty absurd for you to think that you would be in a position to negotiate salary moving from the BO to FO. The fact that you didn't have to spend time in the MO is impressive in itself. Sounds like you made a pretty big misstep, but just use it as a learning experience. More opportunities will come.
yes, agree I fucked up. Naive of me. Lesson learnt. Thanks.
The problem for OP is not the lack of leverage, it's the "back and forth". NO ONE wants things like this to drag on and on. The best piece of advice I've been given is that all salary negotiations should start with you saying, "I will sign with your company for this . . . " and then name your price and terms. The company wants to feel like they can actually get you and most people will respect your assertive approach. And it also avoids the back and forth - if they meet your price congrats, if they don't, everyone moves on. Put your price out there and hope for the best - it's the only, professional, route that makes sense.
Thanks I would try that out next time. Yeah I agree the back and forth caused a lot of frustration. Not just for them but on my end too!
Hey guys, I am back office so take it for what it’s worth. That being said, there’s a decent podcast on this called Listen Money Matters. Google that and google something along the lines of salary negotiation. It helped me double my pay coming in from another firm. Basic concepts are not showing your cards until the firm has shown there’s and using your background and skill as leverage if you can.
They got on the phone and asked me my desired pay. I countered and asked them what the range of salary would be given the background of an experienced individual. They mentioned say 100-120k for reference. They showed a few cards there and I let the HR rep continue on to state that the last person in the role had no licensing. For me that immediately ruled out the low end as I was licensed with 2 licenses. Given the range was only a 20% difference I added 10% for the licensing and 5% for total comp bonus to get to say 115k as a first offer. They called and said I asked for almost the max. I countered with the ammo i stockpiled, stating the range, my licensing and my eagerness to join. Ultimately I was given less in base but had a higher bonus that not only met but exceeded what I was actually looking for. Note: this may be aggressive given a junior role with no leverage. Just some thoughts. Thanks
Here is the link for anyone wondering about it: https://www.listenmoneymatters.com/salary-negotiation-tips/
Won't read it just yet cause I don't have an offer anyway. But reading what you said about not showing your cards. I could not have done it with the bank. Basically, it was a give us your current salary or we won't proceed. And don't try to lie cause we would ask for documentation about it.
How would you have approached it?
Personally, as someone in a similar position as yourself regarding BO vs FO wouldve approached it differently. I, as I am sure many have, have been working on L2 of CFA, networking and applying to 100s of jobs etc. I would have and will have a cost benefit scenario in my head laid out. At this point, I would have come to the realization that the only way I am getting an interview is thru my network. Thus, my qualifications alone have not brought me to the ball game. If they had, I would see more offers and interviews. This leads me to believe i am at their whim. That being said, I am also at the point where I would take same job or maybe a cut to receive formalized training as opposed to using BIW, WSP, WSO modeling courses to teach myself on my own time. I would have approached it knowing that the experience I am getting, and the rarity of having been in that position vastly out weighs a pay cut or no pay raise. As stated by others, the experience and the industry alone will pay you handsomely in the long run. Formalized training alone will allow you to break into other banks down the line or break into other positions in the industry. The skills you gain in the industry are obviously quite sought after and that alone would just tell me that I need to hop on this chance and not screw with it. Even if I wasn’t ecstatic I would act like I was just to get along and hopefully down the road increase my chance of good fortune in receiving a higher bonus and pay raise.
Same thing happened to me and I was devastated for a couple of weeks. I knew it was a risky strategy but it's something I thought through carefully. I don't know your motivations but mine were based on what I thought I could achieve in the market. Thinking with my head and not my heart. I knew the risks when I made the counter offer but I also believed in what I was worth in the market. I wasn't being greedy or short sighted.
I was Senior Associate moving into VP and got offered a job at a well known boutique at the level I was at. Because I was joining only a few months before their year end they told me I wouldn't be eligible for promotion to VP until the following year (effectively 16 months' time). To compensate, they promised to underwrite my bonus for the year-end coming if I joined which would have (almost) matched the package I was on at the time. I pushed them on the bonus by a very, very small number and my phone went very quiet.
When I called HR he apologised for not getting in touch and said they were going to 'continue searching the market'! I was shocked and deeply devastated. I had been through over 5 hours of interviews and could not believe this reaction. So binary after meeting me in person multiple times. It really made me question my actions and whether I had done the right thing. I wrote a carefully worded letter to the MD that had interviewed me and copied in HR but it was too late. I had blown it.
Looking back however, the feeling was comparable to when you split from a girl who you know isn't right for you. You're heart is in pieces but if you made the decision for the right reasons you have to stick by it and believe it was right (though it won't make it any easier).
I made the decision after that not to interview for Associate roles and after a few months I was promoted to VP. With VP status I was interviewing for roles I couldn't have imagined a few months earlier and ended up joining a top firm with a huge pay increase at VP level and a huge amount of prestige.
Subsequently I heard very bad things about the firm that rescinded my offer and the way they treat their staff. They never managed to fill the role and ended up covering it internally.
I think the moral of the story is to understand the market and what you are really worth. I made one of the best decisions of my life and would probably have been offered something else at a higher level if I hadn't taken my current role, even though it was very difficult to take at the time. If you are greedy and motivated for the wrong reasons they will see you coming a mile away. Back yourself but be realistic.
Thanks dude! glad it worked out for you.
For what it's worth, I asked for a bump in comp when considering accepting an offer from a small boutique as a litmus test of their culture. It worked out, but I don't think I would have done it at a structured program / larger firm.
I agree with folks who said to not try to negotiate junior-level roles with firms of scale. But that said, you got lucky in dodging a bullet in this case. Low balling is a sign that the firm has a crappy culture, and that's compounded by their reaction.
When you got this offer, the calculus is basically "am I okay spending a couple years being underpaid and working for assholes in exchange for the experience". You also have to consider whether you'll be able to give it your all while being underpaid and probably treated badly.
I might have missed this level of detail but was this for a first year analyst role? Was this a shop that has standard comp package or a smaller boutique that does not pay street.
If OP was offered a lowball offer because of not having relevant experience, can’t be any lower than the standard 1st year analyst pay since that’s someone fresh out of undergrad with zero experience, OP should never be paid less than that. This is a moot point if the firm does not pay street or have a structured analyst program.
Can you give us a sense for how the negotiations went? How many emails, what you asked/what they responded, etc.
Would be very insightful as it can be difficult to know when to stop pushing or when to continue.
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