Is it standard for big companies to be inflexible on raises and promotions?

Question

I work for a Big 4 firm and the annual review period occurs once each year, just prior to the end of the fiscal year. Our ratings are based on relative performance (sort of like grading on a curve) and are determined by committees, with each person having a coach that advocates for you. The committee reviews the performance notes/appraisals that have been written by managers you worked with over the course of the year and evaluates you accordingly.

We are notified of our rating and whether we are getting a promotion or not about 2 weeks before the end of the year. Just after the first of the new fiscal year we are told what our compensation will be (salary + bonus), with salary taking effect immediately and bonuses paid out three months later.

The individual person has no lobbying power as to whether or not he/she will get a promotion, what kind of raise (if any) will be given and whether a bonus will be handed out. These details are hashed out by the committee and then set in stone. The pay has already taken effect before the individual has a conversation with his/her boss. Compensation is restricted by staff level, so there is a particular band for each level depending on the region and a person cannot be paid outside that band.

My question is this: is it normal in a big company (or any company) to not have any say or negotiating power over compensation or promotion? Since it's not possible to negotiate anything, I feel quite powerless. What can be done in a situation like this?

Answer 1

I have worked for several companies with policies like this.

You have a few real options:

1. Find a position you can transfer to for a higher rate of pay. Despite what your manager may tell you often if you can transfer to a different business group you can get a significant raise. But you usually have to transfer completely out of your current reporting structure.

2. Accept your current pay rate. There is something to be said for stability. If you enjoy the work you do and the money you make is enough for you to live then this is a real option. The grass is not always greener on the other side. Sometimes it is better to stick with a job you enjoy rather than go out and find something that pays better but you hate.

3. Find a new Job. This is your best bet for finding a position that pays you what you are looking for. This is also probably the most work and the most risk. But it can also have the biggest rewards. You should probably ask for at least 10% more than you would want from your company to stay. Probably even more. You do not want to end up back in the same situation in 2 years where you feel underpaid again.

Answer 2

I have never seen a large company where there is much negotiating room on the annual appraisal pay raise. This is budgeted money after all and they have spent weeks negotiating how it will be split up. That doesn't mean you can't ask for raise or get a promotion outside of that process. Just don't do it immediately after the appraisal. The best time seems to be after someone has left who is not being replaced, that's when there is some salary money available in the budget.

Answer 3

Nothing's Ever Inflexible.

Everything's always up for negotiation.

They just don't want you to know it.

It Can be Hard to Shake, Though...

But yes, it's more common for bigger firms to be less flexible. Obviously the bigger the firm, the more process-driven it is. That applies to HR as well.

They define baselines to:

• avoid dealing with every single other employee asking for raises,
• take away the guesswork,
• and - because it's not (just) about limiting you - to optimize performance (yes, people do think hard about how to model this stuff).

Take Control

But, on the other hand, big companies are more keen on giving you regular raises. Which is a double-edged sword. They'll give you raises without asking regularly, but it's not only to keep you happy and out of the good nature of their heart: they want to keep you happy AND quiet. Obviously you feel less confident to go ask for a (bigger) raise yourself once they handed one over to you, and you feel already a better sense of recognition.

Don't let that fool you. If you get a raise that's not good enough for you, do submit a counter-proposal. But be sure to back it up with performance data, and a quick market research of the average values for your position in your area.

(For more details, I submitted additional information on a Programmers Stack Exchange question on being burnout early and asking for raises.)

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