How to negotiate a higher salary for temp to hire position where I'm being hired full time from being a temp?

Question

I got hired as a marketing coordinator at a company through a recruitment agency with a contract to hire position.

I got offered a full-time position the very last day of my trial period, and on my contract, the offer is 10% lower than the salary I was getting from the agency. The current offer includes medical, dental, and travel insurance and PTO.

So, my question is that if it's normal to get a lower pay rate if you are hired full time because of the benefits you get, such as: 401(k) saving plan, insurance, etc.

I did some research as well, and the salary range based on the zip code and experience start at 5% higher than what I have been offered, by not taking into account bonuses, incentives and other forms of compensation. Is it possible to ask for a higher rate, and how can I do so without looking desperate?

Answer 1

Of course it's possible. Everything is always negotiable. The only question is how the negotiation will be received and if you ultimately get what you want.

In this particular case of a job offer, there is absolutely nothing wrong with turning it down but saying you'd accept a higher offer. Of course there is equally nothing wrong with the company deciding not to agree to that higher offer.

Employment is a voluntary agreement between both parties. If it doesn't work for you, don't accept it. If you can do better, go do better. If you can't, then it was a fair offer and that's all you're worth and you can't complain.

This is the free market at work. Both the seller and the buyer can make whatever offers they want or try to negotiate, and they can walk away any time they feel the chance of a acceptable deal is too slim to bother with. This works for you and them.

Answer 2

It is not uncommon for a company to offer at the low end of the range because they expect you will want to negotiate. It is certainly fair for you to say that the salary offered is less per hour than you were making as a temp, and that you wondered if there was any room for negotiation. If they say no, then you have to decide if you want to take the offer. They might say yes, they could stretch to another $200 per month (or whatever), and you won't be the first person to ask.

The value of benefits is considerable, as you note, so it is also not unusual for a company to pay less for a regular employee than they pay for a temp. The temp not only is cheaper benefit-wise, but the temp arrangement also gives the company the flexibility of ending the employment at any point without the expense of separation. So you get a little bit more security than you had as a temp, which has value.

Answer 3

Normally, it has been my experience that the salary companies pay you as a temp is going to be higher than what you could expect as a full-time "permanent" employee. This is because people expect to be compensated for the fact that the job is temporary. Contractors can have anywhere from one to two months of downtime between each job, so they need to make that up with a higher hourly rate.

Technically, temp-to-hire isn't a contract position, as you expect to continue with the company, but there is the uncertainty factor to consider. I've had several temp-to-hire situations that didn't turn into full-time positions. In this case what you essentially have is a short term contract position.

In my field (programming), at my experience level, I expect to be making about $55 /hr for a contract or contract-to-hire position. For a full-time position I'd expect about 90K. That's about a 22% cut in pay. You are getting a 20% cut. I'd say it was in line with what you should be expecting.

Answer 4

The told you there was a range (40-45K), but didn't mentioned the criterion used to determine where? Were you speaking to someone who was talking off the top of their head and didn't know the exact amount? Did it depend on the financial stability of the company?

I would find out why you got the lowest end of the range because this initial impression is going to follow you the entire time you are employed until you can prove otherwise. It could be lack of previous experience, but your trial period should account for something.

It would have been assumed the number you were given included benefits. I can't imagine indicating a possible offering without benefits and then include benefits later on without explaining this upfront.

Answer 5

Weighing in quite a bit late here, but hopefully this will be of some value. When folks discuss the potential for a difference in pay between the contract-to-hire phase and permanent employee phase, they rightly point out that YOU, the employee, will likely be gaining better benefits.

What they don't point out is that the employer is probably paying roughly the same amount for you. The agency that placed you is getting more than you are, but in addition to paying you, they have to pay all the payroll taxes on you. FICA taxes, workman's comp, unemployment, etc. On top of that, they have to actually run their own business.

Answer 6

I was in this exact situation in my first job out of college. I was interning for a company, and upon graduation, they offered me a job. The offer was disappointing, but I really liked the company.

I did research, talked to my career counselor on campus, and put together a document outlining where I thought the salary should be (about 7.5% higher) based on market rates for my area.

I talked to my hiring manager, who knew the original offer hadn't excited me (my poker face wasn't developed yet!), and presented him with the document and explained my reasoning.

He went to his boss, who approved the rate I requested in the document, and I happily accepted my first full-time job.

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Were I you, I'd follow the same steps. You think you are worth more, you think the market rate is higher--do your research and give it to your boss as the beginning of the salary negotiation. Keep in mind everyone else's points: contract will not always translate directly into salary due to the non-pay benefits that come with salary. But, if your market supports a higher range, your previous contract rate will have less weight here.

Do your research, negotiate. All they can say is "no, original offer is firm". I wouldn't expect they'll rescind their offer just because you tried to negotiate.