How to get a pay rise

By ANGELA McCARTHY

Asking for a raise sounds straightforward, but it can be a nerve-racking experience. It requires clever negotiating skills, researching your market value and building a solid business case, advises Robert Half Finance & Accounting general manager Kim Smith.

Performance and market pressure drive salary increases, says remuneration specialist Kira Schaffler of Higbee-Schaffler, but generally pay reviews are in order if you haven't had one for more than a year or believe you're lagging in the market significantly. However she tempers this advice.

"Don't assume you should be paid 'the market rate' because there is no such thing. The market is a range - not a number.

"You can expect to be paid towards the top of the range if you're very experienced and a high performer. If you're new in the role, and learning the ropes, expect to be paid lower in the range."

Also, she adds, lagging in the market means being below the range, not being paid less than your mate who works down the road. And be wary of just looking at the base salary.

"Company A worker might earn $100,000. Company B worker may earn $80,000 but also get a car and insurance, so look carefully at everything before you start feeling hard done by," says Schaffler.

She also points out that you shouldn't base your research on job title alone - "accountant" can mean many different things and might be paid anything from $33,000 to $95,000.

So how do you work out your worth? This is vital information if you want to be taken seriously. Do your preparation, advises business psychologist and executive coach Jasbindar Singh.

"Is there a company policy on raises? This can help you to be realistic in your planning. Do you know the standards for your industry?"

Carol Beaumont, secretary for the New Zealand Council of Trade Unions, says information about pay rates is much harder to find now the national award rates system has gone. The union often gets calls from non-members and employers asking about job rates.

"Unions build up databases and know about rates in their industry and sector and in many cases the union will be willing to help you."

Researching market rates for your own job is difficult, agrees Schaffler. Remuneration consultants are usually reluctant to give such information, as a job cannot be priced in isolation from factors such as organisation structure, relative levels of accountability and so on.

But there are avenues for finding out.

Ask your manager what the organisation's average budgeted pay increase is. However, they may not be able to tell you or may not know, warns Schaffler.

She also suggests finding out what colleagues in equivalent or similar positions are being paid.

David Jones, Robert Half Finance & Accounting Australasian manager, suggests checking your value with professional associations, personal networks and recruitment consultants. As a consultant, he's happy to give comparisons and examples.

"A decent recruitment consultant should be able to tell you specifically what people with your skills are getting paid in other companies."

Once you've worked out your market value and feel you have the right to a raise, you must prepare further evidence for your case, say the experts. Schaffler likens this to stepping into the shoes of the manager or shareholder.

"What would you consider justification for a salary increase?" she asks. "Now build a case around that."

A list of your contributions to the company is essential. This could be the amount of business you brought in, landing a major key account, the disasters averted or excellent team output, suggests Singh.

"It is a good idea to run your list past someone such as a good mate from another company, as we are all inclined to be a bit subjective about ourselves."

Timing is also important: it may be wise to make an approach after a successful project, says Singh.

"But also take into consideration the external environment. How is the economy doing, and even more importantly, how is the company doing within that?"

So you've done all your preparation, presented your case and asked for a rise, only to be told "No".

Take a deep breath. You must ask for reasons, says Claire Simcock, director of Career Dynamics, who says employees sometimes forget the bigger picture. "Ask and listen with a business hat on."

There could be a pay freeze because of the company's performance, the economy is struggling or the company policy is to look at remuneration at a specific time during the year.

If you're told you're not bringing enough benefit for the company, ask what you need to add to your skill set for the future, suggests Jones.

If the response is that the employer doesn't have the budget at the moment, then employees should ask that their request is kept in mind when the next salary review comes around, or that your salary be reviewed three or six months down the track, suggest Simcock and Singh.

Take a creative approach - if the company genuinely can't give you a pay raise that you deserve, consider other possibilities.

"Don't just think around dollars," says Singh. "Have other things in your strategy that you can negotiate, such as soft benefits - longer holidays, lap top for home, more flexible hours, gym membership."

Being willing to look at other options sets up a win-win situation, says Simcock, but it is important that you also have a bottom dollar and know what is non-negotiable to you.

"Then you can calmly point out that you won't be happy below that level and you'll have to look elsewhere if you can't at least be paid that amount."

COMMON MISTAKES

* Not asking at all. "Unlike some other cultures, New Zealanders are particularly slow at coming forward," says Schaffler. Then again, some overestimate their worth.

* Assuming there will be a battle and "coming in hard". "The minute you do that the employer is likely to get resentful and angry towards you," says Simcock.

* Not realising the manager may be more nervous than you about discussing pay and performance.

* Poor attitude. "Sometimes people assume they're indispensable and no one is," says Jones. On the other hand, if you exude confidence because you've done your homework and know you can get more money elsewhere, you'll have more chance of success.

* Putting a figure on the table first. Get your manager to make an offer, then if it is too low, you can negotiate, says Singh.

* Using threats, such as resignation. "Regardless of the outcome, the manager will be left feeling uncertain about your longer-term commitment and this could affect your career opportunities within the company," says Schaffler.