How do I best arm myself for an upcoming salary/bonus review in this economic climate?

January 26, 2009 10:46 AM

How do I best arm myself for an upcoming salary/bonus review in this economic climate?

I guess I'm what you might call "upper-management" at a small tech company. Like many others, our company is looking to cut costs and we will likely have a few layoffs later this month. I, and others, have already been informed that any raise in our base salary is off the table for now. However it has also been noted that pre-existing bonus clauses (such as the one I have) are still available.

So the thing is, for the last year I have been as busy as ever (actually more so), mainly because I have a skillset that only a few others have, and as a result I've been extremely busy and IMO was a huge part of helping to land a contract with a Fortune 10 company that was worth a lot of money for the company.

So, my bonus isn't particularly huge by any standards, it's capped at $5k. However, I know from past experience that my bosses treat all of these situations as bargaining sessions. So last year I walked out of the review with a $3k bonus. However, this year, based on the revenue I feel I helped bring in, plus other criteria such as hitting or beating project deadlines, I feel I deserve the entire bonus.(Especially since there will be no change in my base salary).

So I need strategies for this upcoming session. There have already been comments such as "Well, we're all lucky we even have jobs" and other signs that this will not go my way. In addition to this not quite being rooted in reality, I have realized my bonus structure is not based on objective facts, but is incredibly subjective. This was a mistake on my part when I arranged the terms of my employment, however this is my situation.

posted by anonymous to work & money (10 comments total)

Perhaps, given the layoffs and the assumption that they will try to give you little or nothing - given the state of things...

Tell them you are willing to forgo some (all) of this years bonus, for a change in future compensation or compensation structure? In writing, of course.
posted by R. Mutt at 11:00 AM on January 26

Prepare a review of yourself. Note all the projects you had your hands on and in for the last year, and specifically note monetary amounts significant to your contributions. Be professional, but don't be shy about tooting your own horn, as it were. If something fell short last year, note it but also note the efforts and courses of actions you took to remedy it.

If you come out of the review with certain achievements or goals expected of you for 2009, write them down and use it for the next year.

We do this every year at work, but I work at a much larger company. I'll be honest... I hated doing this at first and the end of the year is tough to find time to write a comprehensive review of yourself, but it really helps when that review discussion comes around. It gives me something to work towards for the next year and something to benchmark my achievements and goals and measure myself against.

Good luck.
posted by jerseygirl at 11:03 AM on January 26 [1 favorite has favorites]

Start out by complementing them on allowing for the bonus program to continue. Ask them "if they would agree" that the bonus should reflect the value you have added to the company for the last year. The answer will be yes.

Now deploy your review as suggested by jerseygirl. Demonstrate, with facts and possibly graphs what part of things you worked on constitute what part of the company's revenue for the last year. Indicate the total dollar figure that you think you added to the bottom line. Now say that you are "certain they would agree" that the maximum $5,000 bonus, although not enough to properly reimburse you, is the appropriate amount.

The key is to get them to agree at the beginning of the negotiating session, to principles that ensure that you get the bonus. Then they can't go back on it later in the session. Framing negotiations is a key part of getting what you want.
posted by Ironmouth at 11:23 AM on January 26

I advise against foregoing any sort of bonus for future payments. I cannot emphasize this strongly enough. It is a sure recipe for getting beat at the table in the first five seconds.
posted by Ironmouth at 11:25 AM on January 26

As jerseygirl noted, show them why you are valuable to them. Ask for extra stock, better title, more expense money, more vacation, big bonus, whatever you think is possible and desirable. I've found you get more respect for asking for more.
posted by theora55 at 11:32 AM on January 26

Be firm, and acknowledge the pressures that the company faces.

Something like, "To the extent to which bonuses will be awarded this year, given the pressures we're all facing, I believe my contribution to the bottom line has been significant and is deserving of recognition at the higher end of the scale."

Then describe all that you have produced, emphasizing the unique skills you bring to the company and the quantifiable impact that you've had.
posted by BobbyVan at 11:35 AM on January 26

"Give me the bonus or I quit and you'll be fucked."

Phrase it nicer, but that is the only argument that will have even the slightest bit of effect. Subtly, respectfully let them know what your skillset does for them and where they would be without it.
posted by drjimmy11 at 12:11 PM on January 26

A slightly different perspective:

They almost certainly have a pool allocated for this money to come from. I am going to assume that there are others like you who will also participate in this pool. You have a couple strategies to employ here.

1-If there are layoffs involved, that is potentially the same sized pool split over a smaller number of people. This could make the discussion easier than you think.
2-If there are other people participating in the pool, you just have to make it clear to them that you are among the most deserving of the participants (not by putting down others but by giving examples where you added value)
3-If you concede (and you shouldn't necessarily) that you will not be getting a raise this year, you can certainly phrase this discussion such that this bonus is a forgone conclusion given the work that you have done.
4-If they are letting people go, things are probably getting pretty thin with respect to coverage and workload. If you truly are a rockstar, and you do something that few others can do (or you add any value that is almost solely unique to you) then they are going to do anything within reason to keep you. Make it clear that what you are asking for _is_ reasonable and that you expect it in full with very little discussion.

In general, people in your position have far more power than they normally perceive. For some reason many people take a tail between the legs stance on these types of discussion. This only hurts yourself. Go in with the attitude that everything that you want is due (make sure that you have a few examples, not just one), and that you will be glad to continue kicking ass as long as you are compensated like the ass-kicker that you are.

You have a decent chance of catching your manager off guard by starting the negotiation with the max bonus and them some (other perks, pto, profit-sharing, commission . . .). As long as the argument you present is reasonable, it becomes very difficult on that side of the table to not agree. Build it up in little steps, and make sure they agree that each little piece in reasonable. When you summarize, they have already agreed to each component, and the conclusion becomes automatic. Make it seem "unreasonable" to do anything less than what you want.

Good luck!
posted by milqman at 12:21 PM on January 26

"Give me the bonus or I quit and you'll be fucked."

Uhh, definitely not. In this economic climate? No. Whatever OP's skillset, the company may take the risk and fire him, hiring someone who might expect less pay at a new job in his place. Plenty of people to look through now, too.
posted by InsanePenguin at 2:14 PM on January 26

Be prepared to get no salary bump and no bonus. Be prepared to be told that, regardless of your feedback, you're not going to get them because of the economical climate.

Then, respond positively, saying that you absolutely understand, and so you're happy to spend the meeting talking about your positive and negative feedback without worrying about the salary stuff.

In short: make an investment in looking like a great, dedicated employee who is focused on more than your own personal funding. Besides, that way if you do get something, anything, you can say "well, I'm surprised given what's going on in the economy right now, and I want you to know that I really appreciate it!" without a trace or sarcasm.
posted by davejay at 3:34 PM on January 26 [1 favorite has favorites]