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I know that it's not advised to disclose your present salary when negotiating with a prospective employer.

However I am in the situation where I work for company A via agency B, and company A has precise rules on the salaries to be paid to external employers like me. This means that they, knowing the tariff they pay to the agency, also know my salary, at least the range if not even to the cent.

Now company A wants to hire me directly for the same position where I am now. Besides giving an excellent performance before the switch, is there any other way I can negotiate a salary rise?

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    Since you've been doing work for them up to now, it seems quite similar to asking for a raise. Beyond that it's just regular negotiating - them knowing your salary might count against you, but negotiation is negotiation. Also, if you don't already know and depending on the situation, you may be surprised at the size of the cut company B is getting (in some cases I'd be a bit surprised if it's less than half).
    – Bernhard Barker
    Jun 16, 2018 at 10:23
  • They don't "know" your salary they just know the day rate you are contracted to them and this will be a lot more than your salary.
    – Neuromancer
    Jun 16, 2018 at 16:31

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Besides giving an excellent performance before the switch, is there any other way I can negotiate a salary rise?

Yes.

The simplest course is to ask for what you are worth, and be ready to walk away if you don't get it.

What you made through an agency can give you an idea of what they wish to pay a contract worker. That should also give you a good sense of what they would be willing to pay for your services.

If you are worth more to this company than you are currently receiving, the company should be willing pay more. If you are not worth more to them, they will decline and you can move on to a company that will value your services more.

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  • Fully agree. The trick is going into that negotiation knowing what the market is willing to pay. Doing a little online research for your job type, experience and geographical location is an absolute must.
    – user48276
    Jun 17, 2018 at 20:51
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One of the reasons companies use agencies before permanently employing people is to get a sense of what type of work ethic an employee has. If you are not up to scratch, it simplifies the "firing" part, they simply request a substitute with the agency or cancel the contract.

But, often the employee is what they are looking for, as with you, so they make a direct offer, usually with an increase to sweeten the deal. If they haven't made an official offer, but invited you to negotiate, be honest with what you would like to earn, but also be flexible with what you are willing to accept.

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The company knows or has a good idea what salary you are paid right now. That's bad news. But you know how much the company is paying for your services right now, which is a lot more. That's good news.

Between the company and yourself, you are in a situation where you can both benefit. (As long as there is no deal between your agency and you or the company that makes this difficult). There is no reason for you to accept a deal that isn't beneficial to you.

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Keep in mind: Company A know you're good at your job - and they now need "you", it's not any more that they need "someone from Agency B who can do job X".

Be prepared with hard facts when starting to negotiate: There are many websites where one can find pretty interesting statistics about salary, depending on degree and job description. Do a bit of research to evaluate what your work would be worth on the free market. This will give you a good base for negotiations with the (potential) new employer.

You should also collect information about your new employer:

  • Some data about their history. It looks well when they see that you know whom you are presenting yourself to.
  • Are there risks (e.g. bad press)?
  • Do they offer other benefits than money? Maybe there is free kindergarten, more paid annual leave, team events...
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  • I already work for them. It would be a direct hire instead of a via agency
    – L.Dutch
    Jun 16, 2018 at 14:58
  • Yes, and that is exactly the reason which makes you more interesting for them than other employees from other companies. I meant it in the way that now, with so much experience in this particular job X, you are worth more for them than just "someone who can do job X". They have seen how you work, and they like it! They want to be sure now that you won't suddenly be replaced by someone else your agency sends them, so they wish to hire you directly to avoid the risk of your agency sending you elsewhere.
    – B from C
    Jun 16, 2018 at 18:03
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There is something you want to keep in mind.

Unless there is something major going on far upstairs, your current agency contract is not going away. The client is not going to terminate your contract, and the agency is not going to swap you out.

You HAVE the proverbial "bird in the hand". The client's Direct offer has to be good enough to be worth your while. If their offer is not good enough, you are absolutely free to say "I will continue with my Agency for now." and let them sweeten the pot.

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You need a better BATANA - best alternative to a negotiated agreement. Right now, that is to accept their offer or nothing. If instead you had another job offer, they would have to negotiate against that. Even if you are not interested in another offer, go out and attempt to secure one. Even if you don't have another competing offer, you can inform them during negotiations that the positions to which you're applying pay more than they're offering. Don't tell them how much of course, wait for them to improve the offer.

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  • You are missing something important. He already has a better BATANA: the status quo. He is CURRENTLY WORKING FOR THE CLIENT, AT A RATE THAT IS ACCEPTABLE TO HIM. He is free to decline the Direct offer and continue with the agency. The client is NOT going to terminate his contract, and the agency is NOT going to swap him out. The client's Direct offer has to take this into account, and make it worth HIS while to go Direct.
    – John R. Strohm
    Jun 16, 2018 at 18:49
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You are not thinking straight, I think.

At the moment, you have a middle man that is just literally stealing from your mouth and from your "customer", and it is getting a sizable extra part of your salary that could be yours.

So in reality, both of you, the place where you really work, and you, stand to gain from dealing directly with each other. It would be unfair that only one party would stand to gain with the business.

So, be prepared to negotiate. It is not really that much worthy changing arrangements without anything to gain from it.

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