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Mar 24, 2016
This article is part of a series called Editor's Pick.

It’s not unusual in the recruiting process for a candidate to balk at the company’s initial salary offer.

Sometimes in their pushback they might say that, having conducted a bit of “research” they feel that their personal value, or perhaps the company’s job pricing, should be greater than what’s on the table.

How should a manager respond?

Before the advent of the Internet, companies were seldom challenged over how they priced their jobs. The value of a candidate’s background and experience might be negotiated, and often was, but not the internal value of the position itself.

These days, the wealth of information now available online offers interested parties an opportunity to attempt their own investigation, to analyze what a company’s job is supposedly worth in the real world.

What do you say when a candidate tells you that your $70,000 job should be priced at $80,000?

What a manager should know

If you haven’t been hit with this scenario yet, consider yourself lucky. But, it will happen. The challenge could even come from an existing employee, one who feels that they’re being undervalued for their responsibilities.

So how good is that “research” you’ve been told about? Can you take it to the bank, or should it go to the trash pile instead?

First of all, the online data sources most often quoted are frequently criticized as unreliable, inaccurate, and are seldom used by compensation professionals to base their program recommendations. These sources often use data provided by the employees themselves, and may lack adequate filters to assure proper job matches. Data collection techniques are often challenged by compensation practitioners.

Some sources can be self-serving, especially those sponsored by firms tied to the staffing industry. Reporting higher salaries would benefit them in the form of higher fees.

These sources are also convenient and inexpensive, increasing their popularity. But quality costs; you get what you pay for.

Here you get straight arithmetic, plain and simple. The data cannot know the internal importance of a specific job within an organization. It cannot interpret, cannot assign subjective values the way company decision-makers do when assigning a grade among peers, among like valued jobs.

Thus it’s easy to miss the mark by not understanding the company’s job in terms of true market comparators.

So, how should the manager respond?

When you’re exposed to this personal research tactic, step with care. Your willingness to debate the issue hands at least a partial victory to the challenger, who will no doubt boast far and wide about their successful “strategy.”

So if you engage, be prepared for more of this as word spreads. Avoid playing defense.

You might consider other possible reactions.

  • I didn’t hear you — As suggested above, ignore the gambit, refusing to engage in speculation, as discussing the matter gives a degree of credence to the challenger’s viewpoint. Simply state your confidence that the job has been properly priced – then drop it.
  • The pushback — You could ask what are their professional credentials for such research, as your company uses compensation professionals to keep pay levels abreast of the market.
  • Pushback II — You could challenge the “research,” but that gives more credence to the point being made. Likely you won’t win the argument, as whatever you say would be viewed with skepticism.
  • I’ll pass — You could skirt the issue and refer it to HR, saying that you’ll “have them take a look.” This fools no one, but it does provide the opportunity to move the conversation in a different direction. Note: this will not work with an external candidate trying to negotiate.

Be firm on your value of the job

Your reality is that the company has already determined the value of the subject job, and will not welcome outside second opinions. The job has a grade, a salary range and a midpoint — none of which will be changed because someone claims to have done a better job of “researching” how it should be valued.

I’d recommend the “I didn’t hear you” response, and be firm.

By the way, when managers and executives have asked me which sources should they use to research the market value of the job they’re interviewing for, I tell them, “Don’t do it.”

Do they really think that the company is going to listen?

This was originally published at the Compensation Café blog, where you can find a daily dose of caffeinated conversation on everything compensation.

This article is part of a series called Editor's Pick.
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