How to Negotiate a Reasonable Salary with HR During the Interview?
Salary is a crucial factor for almost every job seeker, especially international students. For many, salary is a way to gain financial independence after graduation, justify the high cost of overseas education, and measure self-worth. However, the outcome of salary negotiations is often less than satisfactory.
During the job interview process, most companies have a salary negotiation stage with HR. By the time you reach this stage, you have already passed the departmental interviews and are now given the opportunity for a final discussion with HR. But it's not as simple as stating a number to secure your ideal salary. Negotiating salary is a strategic process.
This article will provide you with an in-depth understanding of salary negotiations: what pitfalls to watch out for and how to navigate the HR salary negotiation process successfully. A crucial tip is to note that salary negotiation takes place during the final HR interview and is initiated by HR, so avoid bringing it up during earlier stages, as it may appear abrupt and unprofessional.
Why Negotiate Salary?
Every HR department in a company has a reference value when negotiating salaries, which can be considered the budget for that particular position. This value is derived from various factors, including internal salary benchmarks for the same position, consulting company research reports, and salaries at similar companies.
HR has the responsibility of cost-saving for the company and their own performance evaluation criteria. When dealing with inexperienced or laid-back job seekers, they may naturally try to "bargain." If a candidate is exceptionally qualified, HR is willing to offer a satisfactory salary or even make special requests.
Usually, HR has two reasons for salary negotiations:
Every position has an expected cost, and by asking about your salary expectations, they can see if your expectations fall within this expected range. Then they can make adjustments within your acceptable range to reduce costs for the company.
They want to assess whether the candidate has a clear understanding of the market and their own situation. It is also a test of their professional demeanor.
How to Negotiate Salary Correctly
In summary, the key to successful salary negotiation is to avoid discussing just a single number in a dry manner. Instead, take these steps: understand the job market, calculate the details during the interview, start with salary before discussing benefits, and aim for the highest total compensation package.
1. Understand the Market Salary Range
Look at the salary range specified by the company when job hunting. This provides a reference range, such as a monthly salary of 10k-15k (pre-tax), which averages out to an annual salary per month. Some companies may use a different payment system, such as 13-16 months. Use this to estimate your expected annual salary and then calculate your monthly salary based on the company's payment system.
Before negotiating salary, understand the market salary for similar positions. You can do this by checking similar job postings on platforms like LinkedIn, referring to industry salary data reports (focus on the median, not the average), or simply asking people who work in the same company or industry.
2. Consider Company Benefits:
Find out about the benefits offered by the company and think about whether they can compensate for a portion of your salary. Ideally, get information from current or former employees who have worked at the company to understand the real situation. If you don't know anyone at the company, websites like Aniday can provide insights from former employees.
These steps will help you prepare for a salary negotiation and ensure that you are informed about market conditions and company-specific factors before any salary negotitations.
3. Calculate the Total Package
What is a "whole compensation package"? It goes beyond the literal monthly salary (e.g., X k) and includes the entire salary structure, such as base salary, performance bonuses, year-end bonuses, as well as social insurance, provident fund, and other benefits.
For example, some companies provide three meals, which can be equivalent to saving around US$200 in a city like Ho Chi Minh. Some offer transportation allowances and gym access. Additionally, the proportion and contribution to social insurance and provident fund (usually 5-12%) can affect the overall employment cost of the company.
During salary negotiations with HR, it's essential not to focus solely on the salary figure. Some companies may offer seemingly high salaries, but their benefits are minimal. Calculating the entire package is essential, as realizing the true cost after joining can be too late.
The recommended approach is to discuss salary first and benefits later, addressing each separately. Salary is your direct income, so you can simply calculate your take-home pay after tax. Benefits, on the other hand, encompass indirect income and require a more detailed comparison. For instance, a higher provident fund contribution means saving money when renting or buying a house. Overtime pay may ensure you are fairly compensated for extra work. Working closer to home can save on daily commuting costs and time. Some companies offer full social insurance and provident fund contributions, potentially saving you the cost of buying private insurance, among other benefits.
You don't need to ask about each benefit individually; you can discuss salary first and then inquire about the company's benefits. Listen to what HR has to say, and then ask specific questions to clarify the details.
Be Confident, Well-Prepared, and Flexible
In a nutshell, when negotiating your salary, there are three key elements:
Confidence
Be well-prepared and unafraid during negotiations. Showing nervousness indicates a lack of self-confidence and a mismatch between your abilities and the proposed salary.
Clear Reasoning
Ensure you have a deep understanding of your fit for the position and the market conditions. Based on your knowledge of living costs in the city, the market's median salary for the role, and your own capabilities, offer a well-grounded figure.
Be Flexible
Have a lower threshold in mind but don't reveal it immediately. Not all HR representatives will readily offer a figure within the middle ground. It's important to have some room for negotiation to create a mutually acceptable agreement. If the initial offer isn't acceptable, be open to negotiate, express your reasonable requests, and communicate your needs with patience and a composed attitude.
