Compensaton for new job turns out to be 50% undervalued. Now what?

August 27, 2007 6:56 AM

What do you do when you learn that the job you were just hired for (three months ago) is significantly undervalued?

So... after years of toiling as a small company consultant, I finally decided to take a job with a small, but elite company managing the entire function of its web site and the team that owns design, production, development and content. Though I had some reluctance at taking the position at the salary level it was offered, I rationalized it that because it was with such a prominent brand, the position so high profile, and the job a seemingly good lifestyle move (40-45 hours per week) that it was worth taking a bit of a hit.

Now three months and 80 hours per week later, I'm not feeling so smart. The team is completely unequipped to the demands it needs to meet in order to deliver on what management has promised for it, needs to be completely reorganized (if not gutted), and the position turns out to be significantly more demanding and stressful than I had ever imagined.

Bottom line is that, while I am very confident that I can do all of what I need to get the job done and turn the group around, I feel like I'm a sucker for getting paid what I am (making less than I was making as a technical Project manager in 1999), and it's just not seeming worth it.

So my question is, is it appropriate to go into HR with my analysis of the situation and start building a case for a compensation review, or do I just suck it up, build the group up to where it should be and take the subject up with a different employer when I am finished in a year or so?

posted by Tommy Gnosis to Work & Money (11 answers total)

Or you could work with Management to make their goals more realistic...
posted by Gungho at 6:59 AM on August 27, 2007

So my question is, is it appropriate to go into HR with my analysis of the situation and start building a case for a compensation review, or do I just suck it up, build the group up to where it should be and take the subject up with a different employer when I am finished in a year or so?

My gut reaction is that you should talk to your employer and outline your concerns. There's no guarantee that this won't happen again at another job. Conversely, you could do both - you could build a case for compensation review while simultaneously working to complete your project and looking for another job.
posted by billysumday at 7:08 AM on August 27, 2007

Actually, I think it's bad form to ask for more money at this point.

What I'd recommend is get prepared, sit down with management, and help them understand how you'd solve the problem - completely restructuring the effort. Show them value, fix the problem. Then, in 6 months to a year, ask for more money.

I don't think asking for more now would do anything but create tension with management. They'll think they're being held hostage and resent you, especially if they give you more money.

You might mention to your direct supervisor how different the job is than what you'd been lead to believe and tell them how you'll be working over the next few months to show them what they need and how you can be successful in the position.

Good luck!
posted by cptnrandy at 7:39 AM on August 27, 2007

I would ask for resources and a reorganization for the team rather than money for yourself. When you have things turned around use the experience to land a job elsewhere at the salary you deserve. Good luck!
posted by LarryC at 8:47 AM on August 27, 2007

I completely disagree with cptnrandy. Asking that you be compensated at appropriate market rate is never unreasonable and if they feel like your request that they do so is somehow holding them hostage then that reflects something about their approaches and attitudes.

I do think that you need to make your discussion about your compensation for the duties you're performing completely and totally separate from discussions about reorganizations, goals, and targets. Asking that your personal compensation be appropriate to the market has nothing to do with internal organizations or deadlines.

Don't make any ultimatums, simply schedule a meeting and state your case. Show salary surveys and comparable job postings and make a request. Make that request something other than "more." If they come back with issues about your only being there three months or the state of the project then you can propose a dollar figure to move you to on successful completion - including a definition of successful completion - including a lump-sum representing what they pay bump would be if they backfilled you for the period between now and completion of the project.

If they won't move at all then realize what that says about them and quietly start looking for new employment at someplace that pays market wages.
posted by phearlez at 9:05 AM on August 27, 2007

Three months ago, you had your opportunity to negotiate your compensation and the requirements for the job. If you're getting paid less than you did when you had 8 years less experience in this field, then perhaps you are a sucker for taking this gig at this pay rate. Coming in after you've started and asking for more money because you underestimated the gig (or didn't read the salary surveys) is bad form for a new hire, and it is not going to help with the employer/employee relationship.

What you need to do is work with management or HR, or whomever to change the other problems. If you're working 80+ hours a week, every week, then your department is short-staffed or poorly scheduled, and you should work to fix that.

If the staff is incompetent, and/or needs to be gutted and reorganized -- explain that up the food chain and work towards fixing it. If the sheer number of hours is the problem, make arrangements to fix that -- even if that means resetting everyone's goals and expectations for what your department can achieve right now.

The conversation should start with: "Now that I've got a good handle on the strengths and weaknesses of our team, and I know how we're expected to work with other divisions, it's become apparent that it's time for a pretty major restructuring. Here's what I think we need to do, and why... Here's how long it's likely to take... And here's how much more productive and sustainable we can be." It should probably end with "I'd like to have either a bonus contingent on these goals." or "I'd like to have a full salary review 90 days after the restructuring is complete, and at that time I'm probably going to ask for a significant raise -- corresponding to our new productivity."

Then go do it. Rebuild the team... make it twice as good as it is today -- and show off why! Then, when you're a rockstar with recently proven results, go ask for more money -- and you'll get it quite easily.

Because from the employer's perspective, what you're saying right now is: "I should've asked for more money before signing the papers. Now I resent my situation, and while I think I am a good person to do this job, I'm a complainer, and I'm only going to do this job (well) if you pay me more than we agreed on -- possibly 50% more."

Also, for future reference... jobs with prominent, high-profile brands tend to (and should) pay you more not less (although frequently it's the bonus structure or other perks (like free transit passes or full 401k matches) that make this true). Anyone who tries to convince you otherwise isn't giving you the whole picture. This is a job. You're working for an employer because they're paying you. Unless you're an intern, you're not working for an employer because it's a big honor to do so.

Even Google is paying at ~10% above the current salary median (or whatever part of the survey they're basing on), for new hires with more than 5 years of actual in-industry experience (the just out of school folks still seem happy to be getting used up and spit out by the big G, so they're still underpaid).
posted by toxic at 11:52 AM on August 27, 2007

Response by poster: I have to admit, I winced a little bit in terms of being accused of being "a complainer", having prided myself in being a good soldier for most of my now 15 year old career, but I can understand how someone might say that.

I did speak with the Director of HR yesterday, where she admitted that the company culture was to continue to heap responsibility upon responsibility upon people to see what they can handle, and said that the job was undersold. She said that after another review cycle (now 4 months away), I could make a case for salary review, but that a 50% increase is not likely. She also suggested some of what has been suggested above: get clarification on these new goals/objectives with my direct manager(s < - i have two), and make a case for compensation increase at the end of the period in which i have delivered in my customary superhuman fashion.br>
So, now it's on me. Is it worth it to continue to work for as long as 7-8 months at a significantly underpaid wage in a gamble that I may get a raise that gets me only part of the way to market rates? I'll need to make the determination.
posted by Tommy Gnosis at 4:27 AM on August 28, 2007

I winced a little bit in terms of being accused of being "a complainer"

Sorry for the strong language. Though, I think it's necessarily harsh. I'm not actually accusing you of being a complainer, as much as saying what the default reaction from your employer is likely to be.

Sometimes, it's about perception. A recent hire trying to renegotiate to the tune of 50% based on the realities of the job (and especially on external market conditions) is very likely to be perceived in a negative light.

the company culture was to continue to heap responsibility upon responsibility upon people to see what they can handle

Wow. That's pretty lame, unhealthy, shortsighted, and ultimately less productive, though I wish I could say it was uncommon. Does the company culture at least recognize when people are approaching their limits, and respect it when they push back?

Is it worth it to continue to work for as long as 7-8 months at a significantly underpaid wage

Well, first, you need to not look at it as 7-8 months total, but 3-4 months more. You've already worked 3 months under conditions that you wish were different. You can work to change your current situation over the next 3-4, but there's nothing you can do to change the past. You have to move past it.

If it were me, it would come down to the job and its day-to-day realities (with some thought to the size of my industry -- if everyone knows one another, I'd rather not it be known that I got spit out by the expectations of small elite company. The possibility of it looking like you just couldn't hack it would be too strong). If the only thing wrong were the pay, then I'd certainly stick it out through the next pay adjustment.

But if the corporate culture is totally dysfunctional, or if you get no support from your managers, or don't get the raise that you need at the appropriate time, or if your life continues to suck even after you've had a chance to try to fix the team, then you should think about bailing.
posted by toxic at 10:40 AM on August 28, 2007

Best answer: Here's the thing: you're either right about this job being significantly underpaid for what it is or you're not. There's obviously not an absolute number that's right or wrong for salary compensation but the market, on average, does not lie.

If you're wrong, you're wrong. Nothing to discuss there.

If you're right, you've just been told that the company is not going to consider market realities in a few months because doing so would represent a notable percentage increase in your compensation. Consider what that means: they're going to refuse to rectify a mistake (in four months!) because it would be too great a divergence... from a mistake.

There are certainly people who are going to take toxic's position that you had your chance to negotiate your compensation, but the reality is that it's not in anyone's best interest - yours or the company's - to have a position that's not correctly compensated within the market. Failing to keep employees happy results in higher churn and therefor lower productivity. It's an indication of poor decision making.

Do you want to work for an organization with chronically poor decision making? If your analysis of the situation and your pay is correct this doesn't sound like a good place to be. Start looking for something else now.
posted by phearlez at 10:42 AM on August 28, 2007 [1 favorite]

it's not in anyone's best interest - yours or the company's - to have a position that's not correctly compensated within the market

Yes and no.

It is in the company's short-term best interest to keep its personnel costs low (and predictable). Many many many companies pay well under "market rate" for all sorts of reasons. Until recently, Google was famous for it -- it was widely believed that the combination of employee perks, environment, options, and magnitude of impact of the Google name on a resume more than made up for a check that frequently was only 50-70% the size of what the employee would be getting down the street. (To a certain extent, this was true, especially since the equity part worked out well for a lot of people -- but we have the benefit of 20/20 hindsight. A Google option, circa 2001, is worth a lot now, but 95% of options written in 2001 are worth nothing today. It's not easy to tell the difference between the two at the time)

In the long term, though, this usually breaks down. Having properly-paid employees working at sustainable levels results in happy employees, and a much lower turnover/burnout rate. (There is an exception for early employees of equity-fueled startups, but since the company in question was already a high profile brand, I'm assuming that the poster wasn't granted options on more than a sliver of the company).

But... lots of the tech industry works on a very short-term cycle (and many of the people who work for small, elite companies won't want to work for them when they grow to huge, powerhouse companies) so the problems with long-term employee retention are actually somewhat mitigated. Companies claim to be "startups" long after they should, so they can ask for longer hours, pay lower wages, and expense the liquor cabinet.

When you throw in the attitude of "You should feel lucky to work here because of who we are" which comes and goes out of fashion among big brands (and is currently in fashion), you can very easily end up in the poster's situation. It happens,

I'm not saying that this is a good thing, just that it's a significant part of the reality of the marketplace today -- and that the time for determining whether you want to be part of that, is while you are negotiating the terms of your employment.

Once you've signed on, you're part of that corporate culture. Inside that culture (and most others), there's an appropriate time to talk about compensation (at the initial offer, and as part of a review in a few months).

The risks of bringing it up at any other time are not insignificant -- because you're not working with the existing culture, you'll all too often get labeled as not a team player, or a complainer, or various other words that are linguistically related to "outsider" -- especially if you're a new employee with no real track record inside the company.

Yeah, it sucks, and in a perfect situation, it'd be easy to talk your way into appropriate compensation. But it's all too easy to talk yourself into "this was a bad hire" territory, too, and that's much worse than dealing with a sub-par, but livable, paycheck for another 90 days.

Now, if poor decision making is endemic at this place, the rest of the job is going to suck, too. If that's the case, leave (and know that this is only a symptom of deeper brokenness). But if it's really just about the money, then work within the existing system to try to rectify it at the earliest appropriate time.
posted by toxic at 12:59 PM on August 28, 2007 [1 favorite]

Response by poster: I think these are all great answers, toxic, but I think what I'm going to do is present my plan for overhauling the department, get agreement of the goals, objectives and timesframes for executing on that, and presenting the industry comparables for salary of the position I've been hired to do (50-75% higher than what I'm making).

Basically, the job needs to be done right, the position was undersold and "not being a team player" (often code for guilting employees into performing tasks that are not in their interest) be damned, I'm not going bring all my skills to bear on this, as well as my reputation, at bargain basement rates.

If management does not agree with either my approach or my compensation, I will be very happy to take my ball and go play elsewhere.
posted by Tommy Gnosis at 6:04 AM on September 16, 2007