Salary negotiation for company change

[handleman]

I know that there are many of you out there with a lot more experience than I have, and I hope some of you are willing to share opinions. After all, it's not too often that an engineer wants to share an opinion... ;-)

I started with my present company right at four years ago straight out of school doing machine design for automation equipment at a Tier 1 automotive supplier. I'm relatively content where I am now, with excellent job security and pretty good pay/benefits. The company is very strong overall as well. The problem is that I see our division heading down the road to being more of a machine procurement/project management division rather than design.

I wasn't looking to change companies, but I've recently been approached through a mutual friend by someone from an automation company in another town about an hour and a half away. We're still sort of feeling each other out right now, but from what I've heard about this company it looks pretty good as far as management/philosophy. I would definitely be open to making a move if the comp package is right, but salary negotiation is something I really haven't done before, having never changed jobs. I've been asked what my requirements are. Do I just say "I need $X", where X is my current salary (plus some delta?), or should I lay out my cards and say "I'm making $Y now with Z benefits" and let the chips fall where they may?

Thanks everybody!

 

[PSE]

First off, decide whether or not you actually want to make a move. Then decide on what it is worth for you to move. Are the job requirements similar to what you do now or are there additional responsibilities? Is the benefit package similar? Would you commute or relocate? All of these would impact salary choices and negotiation. From my experiences, a 15% bump in salary with a company of comparable benefits, similar work requirements, (and no need to relocate) has never been rejected. My last move also included starting with 3 wks of vacation instead of having the clock "reset" to the typical 2 weeks offered to new employees. As you get on in your career, the time available to be away from work can become at least as important as your salary.

Good luck in your decision.

 

[ajack1]

Salary plus 10% was the general rule of thumb if all things are equal, which of course they never are. However with low inflation and pay rises that may be pushing it these days, at least in the UK.

I am not sure there is a suits all solution, are you thinking of leaving for more money or do you want to leave and more money would be nice? If you are not well paid in your current job telling them what you earn may not be a good idea, if you are very well paid it is a good negotiating tool.

Personally I prefer to negotiate the whole package, but others will go about it differently. Would you move or travel 3 hours a day, what would the cost of moving be, or the cost of travelling, do you want to lose three hours a day sat in traffic, have you built up holiday allowance if so how much money is an extra weeks holiday worth to you, are the health and pension benefits better or worse, is there a share option at either company, where would you be happier?

To me there is a lot more to it than just the money, negotiate hard on all fronts and good luck.

 

[corus]

Never say what salary you're on and never state what your minimum salary expectations are. If the new company thinks you're not happy with your current job and think you're likely to be made redundant then they'll offer a low salary in the knowledge that you'll accept anything that's going. Bear in mind that the cost of commuting will increase and so the new salary should reflect that plus whatever you think you're worth. For me, an hour and a half's commute is too much and the new company should offer a relocation package.

corus

 

[GregLocock]

1.5 hours each way is almost one whole day a week.

I'd need a pay rise of about 50-100% to justify that.



Cheers

Greg Locock

Please see FAQ731-376 for tips on how to make the best use of Eng-Tips.

 

[handleman]

I would definitely be moving. My commute is currently about 30 minutes, but I would love it to be less. Even better would be a 30 minute bike in good weather. My wife and I do both have family ties in the other town. Job requirements would be pretty similar to what I do now, I think. There's a slight difference in the way the two companies handle projects. Right now as mechanical designer I'm responsible for both mechanical design and project management. From my limited experience/knowledge, I understand that the norm for most design-build companies would be to have a "project team" with a leader/manager (maybe 6-10 yrs. experience?) managing the project and coordinating the efforts of designers/fabricators/assemblers. If I made a move I believe I would be concentrating more on the design side, which is what I'd rather be doing, all else being equal. Does that mean I'd be taking a step "down"?

 

[ajack1]

I cannot see how spending more time doing what you enjoy is a step down, but then again I do not have three new cars sat outside a huge house, but I know which makes me happier.

 

[DaveVikingPE]

If you're being goaded into switching companies, and they really, really, really want you, ask for 150% of your current salary as your new base pay. If they say they can't do it, thank them for their offer and get back to work.

 

[sms]

But even if it is a job you are really interested in, you need to decide what delta compensation is necessary for the move and ask for more than that. The last two times I moved it was to jobs that I really really wanted, but I did the math and came up with a number that would make it reasonable for me to move, then added about 5%. In both cases I got what I asked for. During the negotiation process there was some whining and wailing, but they gave me what I asked for. Most of the whining was because the hiring manager had to go back to HR and convince them to give a bit on their hiring practices.

Another strategy is to ask for a signing bonus to supplement the package, if they can't do the salary, or if you will be losing a bit on benefits, a sign on bonus can make that up. Also make sure that the benefits line up, and if your moving then ask for relocation expenses.

Bottom line is do a complete engineeing cost analysis, then decide on how much money to ask for.

-The future's so bright I gotta wear shades!

 

[ctopher]

My current company came to me. I turned them down a couple times. Then they came back a couple more times. (during a year's time). So, they wanted me, I negotiated. I turned down their official offer, waited a couple months, accepted their second offer. It was worth it. A lot of companies will not negotiate.
I told them approx what my salary was, plus bonuses, I told them what I needed to change. They came very close.
Plus no more long commuting on the freeway is like getting a raise.

Chris
Systems Analyst, I.S.
SolidWorks 06 4.1/PDMWorks 06
AutoCAD 06
ctopher's home (updated 06-21-05)

 

[jmw]

As always put together a list of pros and cons and consult the family.
Then rate each value and see where the logic takes you.
If you don't like the result, it may be telling you something you don't want to address logically but emotionally.
Then you have to decide if you want to let logic or emotion run the decision... unless they both end up aligned.
But you really need to take each value in turn and analyse it. I say this because you obviously have some doubts and this may be the way to focus your mind better.

As an engineer you measure and calculate, changing jobs can need some of those skills too, use them.

Take all the financial considerations such as relocation etc. and list them out and put a value on the cost of the move, re-location or extra travel and what happens if you start work and travel while you look to relocate.

Willingness to relocate is always a good sign to employers because it signals committment so don't be afraid to ask for "relocation" money or signing bonus or whatever to compensate you for the moving costs.
You may not need to be direct, just say "yes, it's a great offer but I need to work out what it will cost me to move....": their cue to say "Don't worry, we'll take care of that..."
Pretty pointless moving for a 5-10% increase if it will take you anpother 4 years to recover your investment in the move. Paying such fees is a sign of commitment by the employer's but I wouldn't take it as a guarantee of job security, though it may give them a little more investment to protect.

Oh yes, if they've approached you, then add a bit of value to your expectations.... effectively they are moving you a from a buyer's to a seller's market.

Remember that starting a job is about the one time you get to have serious discussions about salary, rewards and prospects; and be sure to get agreements up front, it's surprising how "circumstances change" or the management memory fades on promises; it's probably a safe assumption that whatever promises they make, what you ultimately get will be what you get now.

If they say they want to start you and see how things work out, you know that if they don't work out, you're out so why take a reduced starting salary on a promoise of better "if things work out"?

Rule 1: If you don't ask, you won't get.
Rule 2: It's a negotiation, negotitate. That means be prepared.
Rule 3: get it in writing.... they can always type out a new agreement to reflect what you have discussed, don't take a "we'll sort it out later" approach, it will never get sorted out.
Rule 4: You don't have to accept their "standard terms and conditions" you can negotiate these as well (or you can try). I knew one guy who decided he'd been made redundant one time too many and asked for a special redundancy clause in his contract and got it. A few months later he was made redundant and walked with a substantial pay-off. (Rule 1)

JMW

http://www.ViscoAnalyser.com

 

[Ashereng]

Have a salary range in mind, after doing all of the above mentioned good advise.

Have a benefits package in mind. Remember:
- the deductibles, what is covered (if you are young, you may be starting a family soon, so orthodontist coverage is a good thing)
- how much is employee contribution that sort of thing. RRSP or in the states, 401K/Roth contribution matching by employer
- paid vacation (at 4 years, probably 3 weeks)
- how many sick days allotted (you will be having kids soon?)
- flexible hours (may or may not be important)
- anything else you deem important

If you have to move, ask about the moving package/allowance. Figure out how much it will cost you to move yourself, so you can gauge the allowance.

And yes, get everything in writing.

"Do not worry about your problems with mathematics, I assure you mine are far greater."
Albert Einstein
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