Re-raise before the turn?

April 9, 2008 2:15 PM

i'm considering asking for a raise at work, which might essentially require asking for a raise for my whole team. soliciting opinions on if it's appropriate at this time.

I'm a contractor at a well-known but not top-tier startup in the Bay Area. It's a position I've held since mid-January on a 3-month contract that expires next week and for which I have a verbal agreement to re-up, but not a signed one yet.

I make $13/hr for my role here, plus a performance-based bonus of $175/month, which is easily and regularly achieved. There are 10 people total on the team, and from what I gather the manager and at least one other, likely two other people are on salary. I know that including myself 4 of us are on the same contract, that a 5th, more tenured person has the same pay rate plus health care, and that a 6th, also more tenured person is on the same pay rate but does not have insurance. Neither of these people asked for more money, and my take is that the 5th did ask for health and the 6th did not, although the 5th might have just been offered it.

My role is pretty simple admittedly, and I think they'd have a pretty easy time hiring people at this rate. And I signed the first contract willingly and I understand that it's a business and they are under no obligation to me. But I also find that $13 in this town is barely livable, and I figure if I'm going to ask at any time, this is the one. So I did talk to my boss, who agreed that we don't make much and sorta halfheartedly said she'd look into it, but that any sort of rate change would apply to all of us, not just me. Fair enough, but this now means we'd be looking at a $25 - 50K year budget addition instead of five to ten thousand. We have the money; I know that.

I'm torn on what to do because I'm feeling pretty broke these days and am emotinally stirred every time I think about this, so I'm not sure I trust my judgement. I'm also feeling forced to look for other opportunities which might require me to break a contract, so I'm leery of asking for more money and bailing soon after anyway. We have the opportunity to ask anonymous questions at regular all-hands meetings and I'm considering asking "Can my whole team have a raise?" but that seems foolish. What's the best way to handle this? I'm hoping to get bumped up at least to $16-18.

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posted by anonymous to Work & Money (9 answers total)

It's hard enough to ask for a raise for yourself. It's downright unfair to have to ask for 10 people. The first thing I would recommend is to start to distance yourself from your teammates. Take additional responsibilities. Then you can ask for more since you are doing more (and not have to worry about asking for everyone).

Secondly, you should really consider another line of work if you're living in the Bay making $13 an hour. Don't know what to do? Ask Mefi!
posted by Murray M at 2:43 PM on April 9, 2008

Contracts are negotiated between the employer and the employee -- there's no reason you should have to ask for your entire team and probably no reason that the company wouldn't be able to negotiate a raise with you alone. Your company may have some other policy with regard to contractors (were you all hired through an agency?), but to me it sounds like she's trying to make it seem difficult and unlikely.

Good luck! I wouldn't ask an all-staff question about a raise though. It could put the management on the defensive and your boss would likely guess that it was you who asked. May not help your case.
posted by Pantengliopoli at 2:56 PM on April 9, 2008

This question feels complicated by the existence of your other coworkers, but it's really the same as any other "how do I ask for a raise" question. Basically, your boss doesn't care how much your expenses are. Your boss cares how much value you are providing to your company and how much it will cost to replace you. Therefore, to make yourself worth more money, you need to increase the amount of value you provide to the company and make yourself as difficult to replace as possible. The best way to do this is to be really good at your job and to learn things about your job and the company that no one else on staff knows how to do.

Your coworkers seem content to do the work they've been assigned and make their current salaries. If you don't like your current salary, you need to do more than the work you've been assigned. I would go back to your boss and ask to take on more responsibility. Better yet, if possible, volunteer to take on more responsibility without mentioning it to anyone ahead of time, and then bring it up when it's time to renew your contract as evidence that you're in a different job role that deserves more compensation.

And be open to different forms of compensation. An increase in your bonus is just as good as an increase in your hourly rate if you're willing to do what's necessary to meet the bonus goals. Health insurance is great; see if they'll put you on the health plan like they did for the other person who asked. Can you get paid vacation? Subsidized retirement contributions? These are all things that it may be cheaper for the company to provide you than cash would be, but that will give you more money in your pocket, so you should be willing to entertain them in lieu of some or all of the raise you wanted. Be flexible.

The company is going to pay what they need to pay to get the work done. Do more or better work, and they'll need to pay you more, in one form or another.
posted by decathecting at 3:04 PM on April 9, 2008

I'll second everything Murray M said. And here's some stats. After you pay your own self-employment taxes, $13/hr as a contractor is barely minimum wage in San Francisco ($9.36/hr). Well (...calculating...) it's $11/hr assume you pay self-employment tax on all of it. That's $22k/year, or 35% of the Area Median Income (compared to other single people supporting only themselves). Quite low. You are living on 1/3 of what the average single person in the Bay Area lives on.
posted by salvia at 3:32 PM on April 9, 2008

Assuming you're single / not being heavily subsidized by a partner, I should have said.
posted by salvia at 3:33 PM on April 9, 2008

Unfortunately, I don't think any reasonably large rational company will give you a raise based on your own needs, or the needs of other employees. You have to convince the company that it is in the company's best interest to give you a raise.

Always implied is your ability to leave the company (how important are you?), as well as how much they expect out of you.

The fact that other people in your position are getting paid less does not matter to the company, since they have not made waves to leave yet. Remember, companies would pay you nothing if it was legal and if you had no reason to leave.

You shouldn't have a problem asking for more money and then leaving. The only issue I would see would be if you didn't ask for enough money, in which case if the company agreed to your raise you would still be unhappy. At the least, I think you should ask for what you believe to be your rightful compensation, not a compromise amount, if you are planning on leaving anyway.

We have the money; I know that.

This method will lead to failure. Companies don't stay in business by giving money away.
posted by meowzilla at 3:54 PM on April 9, 2008

There is no reason why you have to think of "the team" at all! Your boss is just sandbagging, since even if you're all on the same contract (and rate) now, there's no reason why you can't have an individual contract with the rate you desire when you're up for renewal. It's not hard. Even with an agency they'd only have to change the terms and number of contracts once the reup comes due. But it doesn't sound like there's an agency involved since you wouldn't be talking to your boss about this if you were, you'd be talking to the agency. Hold firm, you're a known quantity to them, and a 3mo contract is long enough for them to start treating you like a human.

Search askme for all of the "I let myself be underpaid" questions if you want a few days' solid reading.
posted by rhizome at 4:43 PM on April 9, 2008

Your boss said that giving you a raise would require giving everyone a raise. That may (or may not) be true, but that doesn't mean it's your problem. You just need to advocate for yourself.

Here's what it boils down to: There is a pay rate below which you will (or should) walk away from this job. Determine what this number is. If they can't pay you this amount, then you walk away. If there's no chance that you will walk away, then there's no reason for them to increase your pay.

(Note: This is not necessarily to say that you should use threatening to walk away as a negotiating strategy)
posted by winston at 6:19 PM on April 9, 2008

I am a consultant who helps companies acquire and track contract labor (IAACWHCAATCL?).

Companies use contract labor for a variety of reasons. Your situation sounds like one where they are choosing to outsource some HR function (recruiting, payroll taxes, unemployment liability) to a third party, and to purchase easily acquired skills from the marketplace with some flexibility (ramp up, ramp down, end project with ease and agility)

From your supervisor's perspective, that turns this scenario:

Johnny is doing a great job and he tells me he's underpaid, and I like Johnny and we need to retain him on this project.

Into this scenario:

I'm buying hours of labor from ABC Consulting, who have agreed to provide these to me at $XX per hour. If one of their resources can no longer provide hours at this price, can another?

Realistically, talking to your supervisor may not be the best angle.

This piece of advice from Pantengliopoli is factually correct: Contracts are negotiated between the employer and the employee, but what you need to remember is that you are NOT the employee of your supervisor. She is buying hours you provide from your employer.

In other words, you should discuss matters of your paycheck with the organization responsible for cutting that paycheck. If I were your manager (and I were knowledgeable about handling contractors), I'd be non-committal and run you around on this issue too. Why? Because she's not your employer and there are liabilities he exposes her company to when she decides to advocate for the employment matters of someone who doesn't work for her.

So be careful when it comes to rocking the boat. You sound very replaceable in this situation. As an aside, you realize that you're asking for a fairly gaudy percentage increase in your bottom line, right? In this day and age, it's unusual at best for a straight raise (not a promotion) to be more than 3-5%.

There's nothing wrong with setting your own price tag, just be aware that if there are people lined up to do your job at $13/hr if offered, that's what the market price is for that job. Good luck.
posted by peacecorn at 5:22 AM on April 10, 2008 [1 favorite]