How do I use an offer from another company to negotiate a raise from my current one?

September 17, 2009 12:17 PM

How do I use job offer from another company to negotiate a salary increase at my current one?

So the bottom line is I'm not being paid what I'm worth and I want more. My current company is paying me about $5k less than the industry standard for my position, and- as I discovered the other day- $11k less than what my coworker, who has the same job as I but on one of the company's other brands, is being paid.

Recently I've been interviewing with another company which is much bigger, and- judging from salary reports I've read- likely to be able pay me what I deserve. I just finished the third round of interviews, and the HR contact has told me the final step is completing the background check. Since I haven't robbed any banks, I figure this is pretty much a formality.

My work at my current company has been stellar, with my account growing in sales by over 700% so far this year, despite the declining market for my vertical. Meanwhile the accounts run by everyone else on the same brand as me have been flat or falling this year, so not only am I churning out huge profits for the company, I'm the only one on my brand who is doing so. They've repeatedly told me they're incredibly pleased with my work (as well they should be) so I know they'd prefer not to lose me.

My ideal situation is staying at my current company and getting paid what I'm worth. The new place sounds like it might be a good fit in terms of responsibility and workplace environment, so I'd be happy with getting a job there at the salary I'm seeking, but my current company is definitely a good fit. Since the main thing I want is more money, I'd prefer to get it without the risk of ending up in a place that doesn't suit me.

I've never tried to finagle this sort of thing, so how exactly does it work? I get the offer from the new place, we ideally reach a salary I am happy with, I tell them I will think on it, then I go back to my current employer and say... what, exactly?

My thought was "I've received an offer from another company. I'd ideally like to continue working here, but I need the salary increase they are offering me. So unless you guys are willing to make me a counter offer, I'm planning on accepting," but is that too aggressive? Should it come off sounding like such a direct threat, even if it's one I'm definitely willing to follow through on if my ask isn't met? I would prefer not to burn any bridges here, in case I need references etc. in the future, and as I stated I really would prefer to stay here as long as I can get the money I deserve.

Help, mefi!

posted by reticulatedspline to work & money (11 comments total)

Danger! What you're talking about is looking for a counteroffer, and there is some substantial danger in doing what you're talking about. Here's what I've seen happen in the past:

1) You go to your boss/HR and say, I have another job offer on the table, and I want you to match it if you expect me to stay.

2) They match the offer.

3) They immediately start looking for your replacement.

4) Once your replacement has been hired and trained, they fire you, leaving you ass out with no job at all.

It's not a certainty that this would happen, but I've seen this before. I guess it all depends on your risk tolerance, and how long you could afford to be without a paycheck or health insurance (assuming you're in the US) if it goes badly.
posted by deadmessenger at 12:22 PM on September 17 [2 favorites]

This is one you have to go with your gut on, but typical advice it to not try to blackmail your company into raising your salary (pay me more, or I'm moving on). Like the counter-offer when you try to quit, your current company might just be using a higher salary to convince you to stick around just long enough for a replacement to be found.

If you have a really good relation with your current company and don't think they'll fire you for it, just be honest. Tell them how much you'd prefer to stay at your current job, but that you've had people making offers for a higher amount. Don't make it a threat, just let the situation be known. If you don't get an answer pretty quickly, then consider it a rejection (they don't take it seriously enough).
posted by ydant at 12:23 PM on September 17

Been in the same situation many times, best to downplay it, express sadness you've that you've got to leave, really like the place, blah, blah, blah, but you've got a better offer.

Let them put the counter off on the table, if they're gonna do it at all. Not best to put their backs up against a wall, especially so as this will go on your permanent record.

If the salary difference is as pronounced as you've mentioned, and if management is doing their job properly, they'll have anticipated this day and should be prepared to move quickly.

And if they don't counter or move quickly enough when they do counter, just move on.
posted by Mutant at 12:24 PM on September 17

Have you tried directly asking for a raise without bringing up the other job offer? If the first thing out of your mouth is "This other company that I applied to...", you're going to put a big dent in negotiations. If the company feels like you're leaving, they may not bother with trying to keep you and there will be no negotiations.
posted by meowzilla at 12:25 PM on September 17

My usual reaction when someone comes to me saying they've got a better offer is to congratulate them and wish them luck. However, my staff are paid a consistent salary internally and I make sure we're competitive externally.

If your salary is neither of these things I think you can point that out to your boss without bringing up the previous offer. Tell them what you think you're worth and why. If they don't match it without you bringing in an offer letter from someone else then you are working for someone who either doesn't value your effort or is happy to take advantage of your unwillingness to ask for more. Either one of these would be a reason to move to the other company.
posted by IanMorr at 12:38 PM on September 17

I agree with IanMorr. Negotiate with your management without mentioning the other job offer, and strictly based on the fact that you aren't being paid what you are worth. If they say that there is nothing they can do, well then, you have to move on.
posted by Roger Dodger at 1:20 PM on September 17

Do not mention the other offer. If you like the company you are at, then you don't want them to mistrust you and think you are disloyal, by saying you have an offer at another place. That might place you on HR's radar of 'not to trust, don't promote' list.

Present facts, statistics, numbers and figures to show how you are worth the money, and how you perform better than everyone else. Keep it rational and persuasive with numbers. You need to convince them why you should be paid more, and you seem to have all the data on your side. Just show your boss the proof.
posted by hellomina at 3:29 PM on September 17

All the advice here is good- some companies see their employees getting other offers as evidence that they have good staff and see it as a positive. They respect the fact that you are being straightforward, and will make a counter offer.

Other companies will see the fact that you dared to go to an interview as a sign of disloyalty and will either let you leave, or match the salary and then look for an excuse to fire you.
posted by gjc at 4:59 PM on September 17

I wouldn't bring up the other job offer. You can argue a case that you should be paid more without bringing that up. You should also be prepared to switch companies if this place isn't willing to budge.
posted by chunking express at 7:49 AM on September 18

Followup: scratch any counteroffer stuff. The new place just made me an offer and blew my asking price out of the fucking water by a HUGE margin. Screw this popsicle stand, I am OUTTA HERE!
posted by reticulatedspline at 12:16 PM on September 18

Yay, that's always great to hear! Kudos!
posted by hellomina at 3:37 PM on September 18