Extra Fringe Benefit NegotiationPeople are known to get their new companies to pay for their Cobra insurance
in between jobs. For me, all I asked for was another grand or two over the
company's standard tuition re-imbursement limit and did not even get that. Oh
well, gotta work on my negotiation skills
For those who do not know, COBRA is the law that requires your employer
to offer you their standard health insurance policy for a certain period of time
after you leave their employ, whether voluntarily or involuntarily. You must pay
for it, but you do not have to re-qualify for the policy, as you would with a new
policy. COBRA is not a universal requirement. It specifically exempts
companies with fewer than 50 employees for example. As an aside, when you plan
to go to work for a small company, you might want to ask whether they provide
COBRA (although the law exempts small companies, the company can "voluntarily"
join the program). This is especially important in case the company goes belly
up. ... I usually defer all compensation issues until both sides think that they
would make a good match. Most companies now give you a 10% raise from the
previous salary. A friend told me that if I want more than 10%, then I must
exaggerate my current salary an additional 10% so that it will come out closer to
20%. I should have tried it on my last interview because the offer came in at
exactly 10% and I could not get more from them. I ended turning down the offer.
I now consider that experience as a failure in benefits negotiation.
I do not endorse dishonesty. Better be up front why you want more. See
below. Remember the application form that you fill when you join the company? If
anything that you put down on it turned out to be untrue, you can be fired WITH
cause!
Some of the fringe benefits that I've seen were: In general, small start-up companies are more flexible in any of the above
items. Also w/ small companies, they are more flexible with stock option than
cash items such as sign-on bonus or annual salary.
These are the inputs I got from readers of this column over the past 2
months. I wished there were more. Now, for what I have heard, seen over the past
xx years (don't want to date myself here! I have already done enough with 2
"x"'s!). The list is not necessarily in any order, but reflect my rambling
recollection.
1. Salary negotiation. This is the one everybody wants to know immediately
even though it is not a "fringe" benefit. So, let me take a crack at it... And
don't any of you try these with me) The 10% rule is about right. However you can ask for more. But you need to
have a reason. Greed does not necessarily qualify as a valid reason. Some
reasons I have heard are
I have an outstanding offer for x% more from company XYZ, one of your
competitor - This is probably the easiest one. Come-back from the company could
be, "go for the other job" or "OK, we'll match it" or "OK we will raise it by
$$$". Sounds like poker, eh! It is salary negotiation poker!)
The cost of living/commuting will be more by x% - You definitely need to do
some homework here. If you have done your homework well, this is an easy one to
get through.
The offer did not take into account my bonus for the last year - This is OK
most of the time.
I qualified for a company car, so since you are not providing me one, I would
like another x%
My spouse/significant other (no plural here unless you work in West and South
Asia!) was working. To take this job, we have to move and my s/so may not
be able to work here - This one is a toughie for the company to swallow, they
may offer a package deal or job assistance for your s/so or part-time job.
2. Sign-on bonus, pay advance. The pay advance will be deducted from your
paycheck over a period of a number of paychecks. Normally you can get these if
you can make a hardship case. For example in a relocation case, you need cash
for the down payment on a new house. The sign-on bonus and pay advance, are not
typical and will usually require some general manager/VP sign-off. So, ask if
you have to, but unless you are a senior person, don't expect to always get it.
Another form of pay advance that is a little bit easier to get is to ask for an
advance against your work. For example for biweekly paid engineers, this will
give you half your check a week earlier. Again this requires a similar
signature, but if you are hard up against some deadline like down payment, it is
easier to get. Smaller companies are more flexible than larger companies in this
area.
3. Early review with salary adjustment. You essentially are willing to give
the company a try at a lower than expected salary, but only for a short period.
This implies that you are willing to quit if the expected raise does not come
through.
4. Relocation: transportation of car, closing cost of house at both
locations, loan for down payment on new house, relocation service to buy your
house if not sold within a certain period of time (insist on an independent
appraiser of your choosing as one of the appraisers), house hunting trip,
extended apartment/house rental at the new location (normally 2 weeks, but could
negotiate up to 2 months for overseas move), rental car at the new location
while the car and furniture is being moved. In a lot of these things, ask what
the standard relocation policy is. You may be able to trade one thing for
another one. For example, you do not want to take the house hunting trip, you
can ask for a longer apartment rental, or a longer storage of your stuff to
allow you greater house hunting freedom when you get to the new location. As
long as the $$ work out, there is considerable flexibility here. Large companies
have relocation policy. One thing I learned about relocation is that everything
is negotiable. The key is how important you are with respect to the company and
how reasonable/ justifiable your requests are. Anyway, get a hold of their
policy.
5. Vacation. This is an easy one to get. If you qualify for a longer vacation
at your old company than at the new, they will typically adjust your vacation
rate. It may get truncated down by a few days, but ask and you will get
something more than the standard starting vacation rate! Also if the company has
a probation period when you cannot use vacation and there is an event that you
must attend, then ask for an exception from their probation period. 6. Cash-in your stock option, expected bonus. If you can show (in writing)
that you have not yet mature stock option, i.e. options awarded but not yet
exercisable, you typically can make a hardship case of losing money switching
job. You may get cash or equivalent current street value options. If you make
the case that if you have stayed with your current project till the end, and the
probability of hitting the deadline is good, and you will be awarded so much
bonus at the end, then the new company will pay you now - risk free to you! In
all cases, you need to show the supporting documents.
7. 401K plan match (for non US folks: 401K is a retirement plan where you
typically will contribute, subject to an annual maximum determined by the
government, and the company will match part of your payment). A lot of companies
allow enrollment only at certain time of the year. If you do not qualify at the
time of the start of employment, you may be able to make the case that your
current/old company would have matched your contribution with $xx, so can the
new employer give you this in cash when you sign on?
8. Special health benefit package. If you or a member of your family has a
special health problem, you need to negotiate up-front coverage. Do not assume
that the new policy will carry what the old one will, and be careful about the
probationary period before full coverage. 9. Package deal. With the 2 income family, a package deal nowadays is fairly
common. The new company will have to get your significant other (SO) (I need to
be careful and not be lambasted here for being sexist or traditional) either an
equivalent job, or if acceptable a part-time job, or provide your SO with a
placement service (the company pays for them to assist your SO to market
him/herself). 10. Education. For engineering, agreement to pay for a Master degree or a PhD
at a local university. Other degrees that they will support are MBA, executive
MBA, law degree. The MS, MBA, PhD are really commitment from the company to let
you take time off from work to go to class. Not every class can be taken after
working hours! The executive MBA is a different story, because that one is mucho
$$$$! Schools love these executive MBA programs and you can hear the money
suction from the schools!
11. Stock option. If this is a start-up, go for it because they are more
willing to give you a piece of the future than cash at the present time. For
established corporation, ask what their award policy is and make a pitch.
12. Company car for management and sales folk - this is the status symbol in
the US, a company's car! If you can talk them into getting you one, then you
need to get into the gory details of what kind of car! Should it be a Mercedes
sedan or a Porsche convertible!)
13. Employment contract and golden parachute. This is for the executive
suite. So let me skip it because you need a lawyer for this.
14. The private office, the direct telephone line in (for the spouse and/or
SO(s) and kids to bypass the secretary and the switchboard - just trying to
avoid being the topic of office gossip here!), the personal fax and THE PERSONAL
secretary, the personal parking space. Ah, all these status symbols!) 15. Commuting expenses. For big city workers, the cost of public
transportation or the cost of parking or participation in carpool. This
typically requires that the company local policy has a provision for it in their
standard policy. Carpooling is becoming a requirement for employers in big city
due to federal/state/local pollution control requirements. Certain companies
will even provide the van for the carpool. Ask! You got nothing to lose in this
case, and in the carpool case you are being a responsible Green (as in
environmentalist movement) citizen!
16. Cellular phone, pager. Not for me, I want to be able to hide. But others
like these gadgets. If nobody in the company has these gadgets, I would not ask
for them, but check their policy before asking.
17. Voice mail account linked to your phone. Ah, the indispensable answering
service! See comment above.
18. Trips to visit family. For people relocating, you may want to negotiate
up front, how many trips the company is willing to pay for your going back to
visit your family in the other city, while the house there is waiting to be
sold.
19. Time off from work over the next year for your prior commitments, either
to a company or a non-profit organization. This is typically WOP (without pay)
unless you can use your vacation.
20. Clerical and travel support for your professional activities. You may
need to have a secretary to help you coordinate your activities. And you may
need to make trips to attend meetings and conferences.
21. Membership in professional organization. Fee to pay for your membership
in local and national organization. Typically, this will be for the first year,
then it reverts to the standard company policy for such support.
Any way, there are many items that you can negotiate. The key is that they
have to be reasonable and you need to explain why they are needed. Don't just
say "gimme, gimme" and expect people to give you what you ask.
My message is that there are certain benefits that are *standard* and
others that are not. There are also certain benefit that are *one- time-only* at
the beginning of the employment and others that are not. One should know the
difference. I would shy away from asking for "non- standard" benefit that are
not "one-time-only". For example, if the company typically does not provide
cellular phone, they may give in and give you the phone. But over time, that
will be looked at as a *special* and may be an irritant. You're better off in
this case to ask for a bigger bonus up front and use it to pay for the phone.
Once the bonus is paid for, no body cares anymore and it's your phone, you can
do with it what you want. Index |