Hi all,
I am at offer stage at an IB for a VP role. You know the general salary question in a process, in London, they always want to know what you are earning right now. I always dodge this question by only indicating a target range for the role and keeping my ground as they will keep asking.
Now more than once, the recruiter inbetween told me that they need salary information in order to get an offer out. Especially in order to arrange a buy out. Read articles on this and I do not feel this is information they need. I also proposed to start at a later date after my bonus pay-out.
To my big big surprise what they like to know is 3years' salary and bonus infomation,(which they are not getting - pretty pissed here). When I said no at least 3-4 times, now recruiter proposed me to have a chat with HR. I think I am going to do that.
The messageing is that they have salry buckets for VP role and my past salary does not affect the offer.
My final position was, if so, let's hear their offer verbally then I will consider.
I like to accept the offer, kind of getting ready to walk out becase of this discussion. I have friends who advise not to, just give them what they need.
Any tips and experiences?
Following
They want to know the salary to see whether the company can even hire you, assuming nobody would want to work for less than before.
Also, they know salaries better than anyone else out there. Technically, they don't have to ask.
Indeed, I told the same thing - HR departments have access to all kind of market salary and benchmarking information. They should be able to judge what I am at.
Also I gave them a good idea about where I would accept the offer. My feeling now is maybe they are trying to see whther I would settle for less by trying to get what I am at as reference.
I am also very paranoid about giving my historical salary/bonus information to their record, as these are the same people that will decide what I should be getting as bonus next year. They will go like, oh yeah this is that she used to get, she will be fine with this range for retention purposes bleh bleh. Obviously I do not want to get any treatment like that given that it will be long and intensive working.
I am pretty wound up tbh.
The HR departments and recruiters all work for the company, and not for you. So they can ask whatever they want. You don't have to answer anything you don't want to answer. But if you say something be prepared to back it up with paperwork if they want to see it. I have seen companies ask for tax returns as an example.
I believe they just want a rough outline where you stand and where you are going. We all had two bad years and the economy is in a bad shape. everyone is trying to save money.
This is all pretty fucked up. 100% they’re trying to shaft you. This is how women get shafted on pay all the time. I would hold your ground. If you’re in corporate finance right now then they know you’re not making as much as a VP at an investment bank but that should have no bearing on your new compensation.
Asking for Tax returns and proof is fucking ridiculous. Honestly if you like the role, take it and then jump when you get better salary comps. I’ve inflated bonus numbers in the past (like what I’m expecting to get next year etc etc.) and has never been an issue regarding future roles. No one has asked for proof. I’m sure some firms may but are those really the firms you envy?
Thank you, indeed agree with you - ridiculous market practice. And sad to get each and every time: " You are the first ever person who is sensitive", "I never had this before"
Please provide us with a break down of your base, bonus and any other benefits taht you get where you are. !%&%?!
Agree with what others have said, I wouldn’t give this information. The only time I share comp information with recruiters is if I think they are talking about/showing roles that are significantly lower in comp/responsibility and I want to make sure we aren’t wasting time (even then it is very general numbers). At the VP level in IB (where things are pretty standard) this shouldn’t be an issue.
As others have said, they want to know the minimum it will take to move you over. I know you can tell them that, I.e. I expect X, but they just want to take your current numbers, bump them a bit and call it a day. I also definitely wouldn’t share comp history, they will look for things to use against you (maybe trend is flattening, maybe last years bonus was an outlier, etc).
It is ridiculous that they think this is ok to ask and are trying to say it won’t impact anything. Great, if it won’t, agree to comp then later you can discuss how much you used to make.
Anyway, I’m in the US, unsure if this is treated differently in the UK.
Could you explain this point a bit? They did tell me that ther is a range of compensation of VPs (surprisigly the increase from bottom to top of the range is 10k). But this is usually sort of statement that I place in the "BS bucket". They just like to tell you eveything to stop you from negotiating. It irritates me and I just dont react to it, just continue doing what I do. I would be keen to understand whether there is indeed such a fixed range?
All I mean is that usually the base for VP level jobs in IB are pretty fixed (small deviations) and the compensation packages are usually standard (base, bonus, and maybe some sort of deferred/stock). The base is standard and the other two are usually just discretionary (not sure if you are negotiating those pieces right now) and all the major variation comes in the discretionary portion. Where if you were going for a more senior role there is a lot more variation in pay and guarantees, so I would be negotiating a lot more.
At the VP level the only points of negotiation I’ve really seen is:
1) buyout for deferred compensation or equity that hasn’t vested
2) what “level” of VP you come in at (I.e. how close to being up for promotion are you) this will impact that base number
3) sometimes (but rarely) guarantee bonus figures (or ranges), at a minimum I would want to understand the ranges to make sure you don’t get paid less than your previous job (I.e. they give out poor bonuses)
That practice is now illegal in the US/NY, not sure where you are. Good on you for standing your ground
I do not live in the UK and am not familiar with recruiting there, but hopefully the following helps you a bit. tl;dr version: watch the video below...twice. It's the best salary negotiating video I have found.
In the US, it is very common for employers to ask for salary during the initial HR screen. They claim they want to qualify you for the role's budget, but what they really are doing is playing this game where they hope to realize some arbitrage between what you think you are worth vs. what the market has dictated. It's a very outdated and ineffective technique because when candidates end up finding out that they are underpaid, they leave, which costs employers more in the long run. Additionally, it does not work if you are trying to recruit top talent. People who are in the top echelon of their field tend to know their worth and will not settle for anything less.
My advice: never be the first to name a number. If they ask, tell them you are looking for something competitive and then flat-out ask them what that range at their firm is. If the employer comes back again, tell them that your role makes you privy to confidential information and that salary falls within that category, so you cannot disclose it, and then ask them again what the salary range is. 99% of employers will yield and just give you the range, to which you can then appropriately reply. If the range is acceptable or even higher than expected, answer with a "I think we can make that work". If the employer refuses to give a range or keeps pressing you, congrats, you just identified an employer for whom you do not want to work. Thank them for their time and end the interview. The only caveat to this is that the ability for this technique to work hinges on the marketability of your skillset. If you are just starting your career, you might be find this difficult to pull off.
Sil,
Fully agree with this approach and it works 99% of the time as you mention. I always always do this.
"What you are at at the moment"
"Ah, does the employer have a budgeted range which you are testing, can you tell me pls, then I can confirm you if we can make tihs work"
"ehmmm... Yeah yeah... their range is bla bla bla"
"Yeah, i think we can make this work"
Then question comes againnn: " And what are you at at the momemtn and how much bonus you got last time"?
" Let's have the first talks, we can then discuss compensation in more detail"
"Yes, yes sure, let me come back to you".
After a while....
"Yeah now you had the talks and seems liek all is going well. There is one thing that the hiring manager wants to know, what you are at at the moment."
" I am uncomfortable to disclose. The HR have market benchmarks that should give them steer on what they are offering ... [at this point also you have to start steering towards the level where you like to come out at and push towards that range you like to come out at]"
... and to my surprise all recruiters will fiercely pursue this information until the last moment. Also apply coercion like " they cannot get out an offer without this information"
(I am not sure whether coercion comes from HR or the recruiter himself tho, a black box to me)
And thank you for the video, I will see it next. Always want to learn more and get better : ) We should all get better at this: )
ive refused before but its just hassle.
I think they genuinely want to benchmark you.
I already inflate my salary when they ask in any case.
Hassle is perhaps good when you are fighting for yourself for once and not making $$ for the firm.
They want to know so that they can pay you 20% above what you are getting and not pay you more than your top number. Like any negotiation if you know what the other party's number is you win.
With my latest job offer I put 0 in the "salary" box. I applied directly on the company's website.
I then talked to friends in the industry to understand what people were getting paid in that particular geography. I then went a step further, I got the numbers of what people were making in that company. My new boss was pressing me to get a number, I told him to make an offer. He wouldn't do it, so I went vague on him. I told him basically the cheap directors get paid this much in your company, the all stars get paid this much. I am changing jobs and industry, if you pay me at the bottom I won't accept the offer, I don't expect you to pay me at the top but a bit higher than the mid and I'll come.
He came back with an offer that was 10% below what I had in mind, but then added 7.5% in some weird tax benefits that I could get at my level of seniority. We never talked about my previous salary, because I did not allow them to engage me with that. I was hired for a job and I knew the figures for that job. If you go in this room and you don't know what the market is, then you are an idiot and deserve to get paid whatever they give you.
The first salary is the most important thing. In my industry as a senior you don't get pay rises, you only get nice bonuses but pay rises are for juniors. So it's crucial to get in at the right level. I am at a large BB for info.
Bottom line is you can't sound arrogant either - there are millions of ways to discuss. The easiest one is, my past salary is irrelevant for that role, I want to be paid market standard for your firm. The other thing is, had a call with a recruiter recently for a job - I interrupted him telling him likely not for me as I earn a lot more than whatever that role will likely pay. Gave him my number and that was the end of the conversation. Sometimes it's better to set expectations from the start rather than being disappointed.
Went into two interviews a couple of years ago, the offer was too low and refused both. One was too low by 5k, I refused by principle. If they were fucking me over for 5k I couldn't imagine how bad it would get when I was negotiating my bonus (that was for a PE role).
The more junior you are, the more of a commodity you are, the less you can negotiate. The more senior you are, the easiest it is to pull what I did.
Thank you, this is very eye opening.
I see few mistakes I have done - will try to rectify those and eliminate in upcoming talks.
Do you have view on what the hiring manager's motivations are? Do they want to underpay when they can? I feel there should be some sort of conflict of interest between HR and hiring manager. Hiring someone new and training them is a pain, so I think there should be retention in their mind. If they underpay, there is likely to be more attrition, especially amongst employees who are high performers with expectations to be fairly treated.
Any views?
By hiring manager you mean headhunter I assume - he wants the deal done, the firm usually has a specific budget so they want to make sure you are going to fit in the budget. That means they don't care if you make 20% more, which is huge for you. So no - they don't have and never will have your best interest at heart. They are manipulative shits for the most part, they will try to convince you to take a shit job just so they can make their cut. Head hunters are scum, almost the absolute majority of them. They sell humans for crying out loud, what do you expect?
Retention is never a concern, it's very hard to switch job and the fast majority of people will stay unhappy and bitch at the pub rather than move. You can't just switch jobs, if you do it too often no one will want to hire you as they'll see a problem with you.
Thanks for sharing this. Recruiters have been pushing me and now I will stop disclosing anything. It is actually supposedly illegal in the US
Indeed Sil's post. Right approach is that in my mind. And it works most of the time.
Truly I think if you ask the employer/firm to match your deferred compensation anytime that is fair game that you should be able to back it up. But no one should ever ask you to prove your salary or force you to give a # if you are not comfortable, but typically people will inflate their salary to what the role they want is.
As you are possibly an industry switcher you should tell them to eff off and as someone explained above research the role and say this what I know others make.
This is a really fair observation. Indeed they did ask me in the process whether I have any deferred compensation, to which I replied no. Also, I told them that no buy out is needed because I like to start by a date, which is beyond my bonus payout date. I tested the tought with hiring manager , he looked content with the start date. I have a usually short notice period because my company did not change my contract through promotions, so it makes life easier for everyone. I realised durign the talks that the notice period appears to be a good bargaining chip.
I also noted at which range I am ready to sign. When signalled a lower number in like the 3rd rounds of talks, I was like, "no that is below the number that was mentioned to me earlier". So now if they come out at a lower number, I should be ready to walk away I guess. In my mind it would signal disrespect from day-one and is a good signal that they would try shaft me in upcoming bonus payouts.
Correct they sound shady. Or they do not need someone asap or do not immediately see a path of growth in the role. List goes on, they are playing hardball on comp and was hoping to add talent at a cheaper level it seems
This is why we have WSO, so we can talk about market rates at each level so we keep from getting screwed
I did check WSO comps and market comps published by recrutiment firms. : ) Gotta do your homework!
I work in New York, which has laws against asking applicants what they currently make. Even that isn't enough to stop recruiters/headhunters from asking.
There is an easy answer here: When they ask how much do you make, you say "Thank you for asking, comp is obviously an important -- but not the only -- factor in choosing whether I can be comfortable accepting a new role."
Then, if they're persistent in asking and if you have already been put forward for a specific role, you say "For this role, something in the range of [$X-Y] would likely be enough for me to be comfortable accepting this kind of role". If you haven't put forward for a specific role, you say "Cash compensation is only one part of the value I derive from contributing to a team. Depending on the role and the circumstances surrounding the team/firm, compensation in the range of [$X-Y] would likely be enough for me to be comfortable switching roles."
If they ask what you currently make again, you just repeat your talking point: "There are a number of factors that determine the appropriate level of compensation from both a business and personal level. $350k would likely be enough for me to consider accepting this kind of role, but I would have to learn more about the role and team dynamic before being certain".
All of this is thrown out the window if you're asking for deferred comp to be matched. In that case, you should be prepared to justify the level of deferred comp you're seeking to get matched. In that case, I would only disclose your current deferred comp levels, but base and cash bonus are not relevant. The theory here is quite simple: the company only needs to know what you will cost, not what you have costed in the past. The recruiter, however, will milk your historical comp for all its worth: they are paid, in part, on their expertise with regard to street compensation and knowing your numbers will help them do that. But it will also help them under-negotiate your offer, so don't provide it to them.
Some (many) people will say that you shouldn't be the first to throw out a number. If you're experienced with a good track record or you think you're a "catch" in terms of talent, I disagree. Know your worth and be aggressive in assessing what the range you need would be. I usually quote the upper end of the market (or even above), and give the out for the recruit in terms of "there are many factors that determine the right level of compensation, including the scope of the role, the structure and pace of the firm, and the immediate team dynamic". If you're not confident that you're gold star-level talent, then it's best to defer comp discussions as long as possible and try to get a number out of them first. But in no circumstance (whether you're the first to give a number or they are) should you give them your historical comp levels.
Thank you for this
I have never understood why recruiters don't share their clients package off the bat, it would save everyone a lot of time. Candidates who out earn this are likely not to be interested anyway.
In more senior recruiting (at least in HFs) this happens more often. I always ask the recruiter for the comp and tell them I don’t want to waste anyone’s time. Sometimes (especially the less reputable shops) try to hedge a bunch, but in general I can get them to give a range (or at least it must be higher than X). As I said, at the senior levels it can waste a ton of time if you don’t do this, especially with how high the variability can be in comp.
With you there. I usually explain comp very early on since lets be real in trading/hf world comp is going to be the main driver.
J.P Morgan done this too
You mean requested you for last 3 yrs comp?
Employers cannot ask you for this information in NY, but recruiters can and you can volunteer it.
I generally don't consider candidates who won't share comp information. I also assume that there is some exaggeration.
It's never only about the "best candidate" or standard package. It's about value.
The comment about wanting to pay women less is also insulting garbage
I interpreted the comment regarding women comps as follows : Because women tend to have lower salaries( which is a statistically proven fact), and when they reveal that comp to the next employer, the rise they can lock into is much lower than what they could otherwise get.
I found it a very fair comment and would expect almost with certainty that this is a trend.
It is very sad that you do not consider candidates that do not reveal comp. Cannot see a reasonable rationale in that statement
Bad logic on the women comment. If women really were getting paid less for the exact same work, why would a rational profit driven employer ever hire anyone but women? I would only hire women if that were true... You think a hedge fund cares about anything but hiring the best candidates for the money? Race, gender, religion, creed, sports team... who cares business needs to get done.
The old employer has a lot more information on the candidate than I do or can evaluate in any number of interviews. Most smart employers do not only pay the marginal price to retain an employee and the ones that do its obvious. You also know who the smart employers are and they will always pay the best employees above that. The frictional costs in search etc are just way too high to risk it.
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