How to counter these salary negotiation questions with HRs?

Question

I'm a Software Engineer from India having current CTC: 9 LPA (Lakhs per annum) and years of Experience: 4.

I've an offer of 14 LPA and serving my notice period. The companies in which I'm interviewing, I ask for 20 LPA base salary. I've been asked below points by several HRs during salary discussion and also during the initial conversations with HRs (before the interviews) for which I had no answer to.

1. That's too high expectation by you. You can't expect 40-50% hike on the offer which you're already holding from another company as we can give only 10-15% hike on that offer. 17 LPA is the maximum, which we can offer.

Note: Here I can't say that my current company will give me this much money because my current miser company have given me only 4 percent hike (despite after performing well) and I'll have to show the latest appraisal letter to the HR with whom I'm negotiating the salary.

2. Me: I've researched that average market standard for people of my skills and experience is 20 LPA. I'm underpaid. According to my past performances, I gave 3x-4x times and even more returns to my previous companies. HR replied- Everyone has different skillset and educational background. You can't compare yourself with others. If you believe that you're underpaid that you can accept our offer and perform well and show us how good you are so that we can give you a 5-10% better hike than others.

3. You already have an excellent offer, which is giving you close to 50% hike. In our organization, for person of your YOE, our budget is 13 LPA and you're getting even more than that in your current holding offer.

4. In our organization, we have a standard of salaries and we can't give you more than those employees who have more YOEs than you and are on a higher position than you.

5. HR: Why do you need this much salary? Is the sole purpose of your job hunt - money only? and then conversation went like:

Me: because I'm highly skilled but underpaid, then HR go back to #2.

Me: I've to take care of my whole family as I'm the only earning member of my family

HR: you aren't alone, everyone does this and 1 or 2 lakhs in your offer won't make much of a difference.

Me: 1/2 lakhs will also won't make that much difference to the company also and I know this.

HR: No, you will know this only when you will have a company of your own or you will get in a higher managerial position in your career. Every single penny matters to the company.

Can anyone please advice on how to counter these questions?

Answer 1

To answer the immediate question: there is almost certainly nothing you can say here that will enable you to get a 20 LPA offer for this role. You probably just need to make a choice as to whether you accept the 17 LPA offer or refuse it.

More generally, the rule of thumb in salary negotiations is "whoever mentions a number first loses". By revealing that you had an offer for 14 LPA, that let the company know that you would at least consider that kind of money, so they were able to offer you "a bit more" than 14 LPA, safe in the knowledge they probably wouldn't lose you to another offer.

Answer 2

It is absolutely, completely, impossible to "counter" a salary argument.

Anything you say whatsoever, can be trivially dismissed by the company side.

If you give a 40 minutes speech about market prices with spreadsheets and examples, they will just say "No, we've looked at the market and you're wrong."

If you give a 60 minute speech about value you've created for the company, they'll just say "It's less than other workers."

So:

"How to counter salary negotiation questions with HRs? ..."

There is only one way:

Get another offer from another company.

End of story.

Answer 3

Remember that a salary negotiation is a business negotiation.

You have something they want (your skills and productivity), and you name your price.

Either what you have to offer is worth what you demand, or it's not. The goal of a business negotiation is to come to a consensus about this question. They can make arguments that what you demand is too much compared to the revenue you are expected to bring to the company. You can respond to such arguments by insisting that what you are going to contribute to the company will justify your high salary. But any arguments which don't directly address the value of your skills and productivity are not constructive.

They say it's unusual to get such a large salary hike? They have a fixed budget? They have standardized salaries? All those are false pretenses. You are not a usual person. They can adjust their budget. They can ask whoever decided on that salary standard to make an exception for you. And when their organisational inflexibility stands in the way of that, then it's their fault that they miss out on the business opportunity you have to offer.

When neither side has any more arguments which directly address your skills and productivity and instead get into spurious arguments regarding what you need or what they could theoretically spend or what is standard practice (for them or for the industry), then it's time to stop negotiating.

So thank them for their time, tell them that your offer of 20 LPA base salary still stands, and if they change their mind, they can give you a call.

Note that one possible answer you might get could very well be:

---

We will hire you with a starting salary of 17 LPA, but we will increase it to 20 LPA at a later date if you do good work.

Before you take up such a counter-offer, insist on getting it in writing as part of your work contract:

• At what date will you get the salary increase
• What exactly is the objectively measurable definition of "doing good work"

Answer 4

"I've researched that average market standard for people of my skills and experience is 20 LPA."

The first thing you need to do is throw out "market rate" for programmers.

IT/Programming, more than any other job I've seen, is governed by Price's Law:

Price's square root law or Price's law pertains to the relationship between the [total productivity] and the number of [contributors], stating that half of the [productivity] come from the square root of all contributors.

... or in short, you can't compare salaries of a mediocre, solid, and all-star programmer. The mediocre programmer might actually be worth less than $0 to the company, if you count in having to correct/maintain/review their code. The all-star programmer might not only finish tasks in an hour that'd take others weeks to finish, but they might be able to do tasks that nobody could do at all - as well as design things in a way that save hundreds of hours of maintenance down the line.

So what did you do wrong?

The number one thing to focus on is: value!

What value did you deliver? What things did you create for each place you work, why is what you did special? Why are you above average? Why should a company leap for the chance at hiring you at X?

Your response to anything short of your minimum salary should be something like:

"You've seen how much value I can generate - I [insert accomplishment here] just last year alone. If you're not able to pay me 20 LPA, I'll keep looking."

Two final things to keep in mind:

• India has a terrible habit of using past salaries to determine future salaries - so taking a suboptimal strategy here where "you can accept our offer and perform well and show us how good you are" is just going to come back and bite you the next time this all happens.
• I'm not saying you should, but keep in mind... it might be worth lowering the minimum you'd be willing to accept a bit. The reason I'm saying this is... imagine you don't find anyone willing to bite at 20 LPA. Then you're back all the way down at 9->14 LPA, trying to negotiate this exact same thing all over again.

Answer 5

You should also keep in mind a seperate metric - What is THIS role worth to the company.

Can they find someone 40% cheaper to do the work 10% less productive than you?

Can they find someone that will do the job perfectly for cheaper?

I would argue, it is less about what you individually should be paid. I would make the argument more about, what they are paying for that role in general / what other companies are paying for that role.

If you can get hired somewhere else at 20.... You should find a company that's offering that. If you can't find this... you will have to accept something lower.

The argument of them not having budget for someone with your years of experience.... seems silly. A department's budget does not change by the experience of the employees in it. They either have a budget that can afford someone up to X salary, or they don't. If they can pay that much to someone else with more experience... Than they can pay that much regardless.

They may have standards that they don't pay outside of bands for experience levels, to keep things from becoming unequal... Not sure. That could also just be a negotiating excuse.

At the end of all of those questions I would simply say "I'm going to have to decline your offer of 17 and ask that you raise it to 20."

Regarding whether 1 or 2 lahks matters.... It is a difference that surely would matter less, proportionately to you, if you were at a 20 salary level than 14 or 17. It therefore matters that much more to you than to them.

These questions are meaningless. They're aimed at manipulating you to an accept an offer you're not happy with. Think about this.... If they succeed, aren't you just going to sit around for a year or two and hate your job before leaving? This behavior on the part of HR seems like it would cause an employee retention issue solely to fill a position for 6 months.

I would just cut in the middle of their questions and say hey... I'm not going to accept a job offer I'm not satisfied with. This is how you get employees that leave prematurely, and it's in both of our best interests that the offer be commensurate with the role. I believe I can find a position at this salary rate, if you really are interested in me for this position, I've stated the salary that I'm requesting for it. Please let me know if you receive approval for that salary position in the future.

In the US, for example, a programmer making $100,000 negotiating for $10,000 extra, even $20,000 is a common occurrence. They fairly often successfully negotiate offers upwards, because their field is competitive and the employer realizes that of the candidates applying, there's a major difference from one candidate to the next. They don't want the position to be left open for months.... So the hiring manager contacts their manager and gets approval for a higher salary amount. Or they lose the candidate and the position sits empty for 3 months more while the candidate finds somewhere else...

Also on the bit that they say if you're underpaid accept their offer and go up 5-10% over time... That KEEPS YOU UNDERPAID, as you will lose out on advancing upwards , as well as potentially the amount your salary should go up per year which may be more than what they're suggesting... What they're suggesting does not actually address your issue. They're just trying to convince you to take a bad pay rate.

Answer 6

To you, all that matters is what you would like to get for your work, and what is the minimum that you would accept (a bit more complicated in reality, there is a minimum that you would accept if you find it impossible to get a different offer, there is an amount where you would look elsewhere for a while and maybe come back, there is an amount where you would sign the contract on the spot).

If you let the company argue with you, telling you that you don't need that much, that they can't give you such a raise over another offer etc., that is not something you can argue with. And because you can't argue with it, you don't argue with it. You state what you want, and they pay it or they don't. You don't need a justification that they will reject anyway.

Of course you'll have to know what kind of salary you can get. If you are worth the 20 Lakh, someone will pay it. If you are not worth it, nobody will. And a quick offer is better; 19 Lakh today is better than 20 Lakh in three months time.