In a prior post, I discussed some ways of obtaining information that can help negotiate a job offer. When you receive a job offer, it’s easy to only focus on the hard numbers:
- Base salary
- Bonus (if available)
- Sign-on bonus (if included)
- Stock/Stock options (if included)
These are the data points most easily benchmarked against your current position (or against the market). But if you focus only on those numbers, you are not evaluating the entire offer effectively.
Benefits are extremely important to you (and, potentially, your family). They are also a significant part of your compensation.
A great benefit package:
- Ensures you can stay well–and provides great care in the event of a serious accident/illness–without bankrupting you (I mean this quite seriously)
- Provides enough paid time away for work that you can have a great work/life balance while not worrying about lost income
- Invests in your future by providing things like employer matching funds in a 401(k) or offering discounted employee stock purchase plans
- Ensures you have insurance coverage for unforeseen events (short- and long-term disability; life insurance)
- Offers other things that make your life easier and heathier, such as a transit pass; onsite bike lockers/shower room/gym (or discount to a local gym); discounts on food; etc.
But how much do these cost–and how to weigh them as part of your offer? The Bureau of Labor Statistics calculated that, on average, benefits cost an employer 30.9% of the overall cost of employment. A 2011 SHRM report states that, on average, employers spent 19% on mandatory benefits (such as unemployment compensation, workers compensation, and Social Security); 19% on voluntary benefits (such as health insurance, flexible spending accounts, vision plans, insurance); and 11% on time not worked benefits (paid holidays, sick leave, vacation, personal/bereavement leave).That’s 49% of the total $ spent on employing you.
Now you have a sense of how much you should value that benefits package as part of your offer. What should you be looking at specifically?
- What does the health plan cost you per month compared to your current plan? What are the annual coverage maximums and co-pays? Can you keep your current providers under the new plan? It’s important to understand these differences as they can add up to real money out of pocket.
- Does the new company offer a flexible spending account or health savings account for medical expenses? That can save you $ in paying for these costs pre- versus post-tax. If you have–and use–an FSA with your current employer, and the new employer doesn’t offer an FSA, that can impact you financially.
- How much does the new employer contribute to retirement (401k, 403b, etc)? This is $ to you, so it’s important to know what the delta is (if any) between your current employer and the new one.
- How much paid time off will you receive? Does it increase over time with certain anniversary dates? Is it paid out when you leave? Companies with PTO plans do not usually let you ‘bank’ time & roll it over into the next year. It is also not often considered compensable time. If your current employer has a vacation plan that lets you bank time–and cash it out if you leave the company–and the new one does not, that’s something to consider. Also look at how many paid holidays you will receive, how much sick time, etc.
- What are the other perks/benefits of working for the new employer? Do they offer a parking subsidy or transit pass? What about an onsite gym? Do you receive free/discounted food or drink? Can you purchase company products at a discount? (Microsoft Employee Store, I’m looking at you…)
Altogether, the differences between benefits packages can mean large overall differences in your compensation–or how much $ will be coming out of your paycheck (or pocket) that isn’t with your current plan today–with a new employer vs. current. It’s well worth taking the time to crunch the numbers and discuss the differences you find with the recruiter. It’s worth noting that most recruiters will not be able to make changes to benefits–with very few exceptions (seniority-based vacation accrual for one) they are usually the same for all employees. But they may be able to make a case for increasing your base compensation a bit if your out of pocket expenses will increase under the new plan.
Hello everyone. Sorry I’ve been radio silent this week. Busy week at work + crazy long weekend painting the house = not much time to write blog posts.
Hypothetical scenario: You’re interviewing for a job with Company A and make it to the final round. You don’t have any other offers on the table at the moment–and aren’t currently expecting any. You tell the recruiter so.
The day before your final round of interviews, you receive a request to interview at from Company B that next afternoon. As your final interview with Company A is in the morning, you agree. Both rounds of interviews go well, and you inform Company B that you had a final interview with Company A that morning and are expecting to hear back from them within the week.
You leave the interview with Company B not expecting anything more than possibly being asked back for a second round of interviews. Instead, that night they email you an offer. You’re taken by surprise, of course, but as you think about the company, what the position would offer to you, who you would be working with and for, and the package you realize that it seems like a very strong fit.
Company A extends an offer to you the next afternoon. Obviously the recruiter is taken by surprise when he hears you have an offer. You ask for some time to really consider both offers, as both positions are appealing in different ways. In the end, you decide to go with Company B’s offer.
But how do you tell Company A that you’re not taking their offer?
This is a great problem to have, admittedly, but a tough one. I recently had a candidate in a similar situation who handled it beautifully. Here’s what they did:
- Begin with the end in mind. How do you want these people to perceive you? You want the hiring manager and recruiter to walk away thinking that how you handled this situation exemplifies all of the reasons they chose to make you an offer in the first place. That requires…
- Inform them early. Inform the recruiter or hiring manager that you may have a competitive situation developing as soon as you are aware. If you don’t have the opportunity to do so, explain very clearly how it came about–and that you weren’t expecting it. A good recruiter will check in with a candidate multiple times during the evaluation and offer process regarding status of other potential opportunities. If a candidate throws a curve ball at them late in the game, it may seem like the candidate hasn’t been engaging in good faith. Which leads to…
- Always put relationships first. This is but one position. It may not be reflective of your interest in working with the company, or this manager/team/recruiter. Also, as you develop your career (especially in a specific metro area) the hiring team/recruiter engaged in this offer process will move to other companies in which you may have more interest. Isn’t it worth having them walk away from the situation thinking that you’re worth keeping in touch with for potential future opportunities, rather than blacklisting you because they felt burned by your actions?
- Walk through your thought process. Ask questions. Gain clarification. A good recruiter should be part career counselor (see this blog for evidence!). They should help you compare and contrast both opportunities, filling in gaps in your knowledge about their opportunity to help you make the best, most informed choice possible. What drives a recruiter nuts is when a candidate treats them like a used car salesman. The candidate won’t discuss their thought process, instead just declaring they’ve taken another offer (often by email). This makes us think that rejecting our position was always in the candidate’s plan–that the candidate was likely using us (and our offer) as negotiating leverage for the other company’s offer (or to get more $ from their current employer). These things do happen, and unfortunately it’s shortsighted on the part of the candidate. Please see #1 and #3 above for why.
Do this with integrity and transparency, and you’ll reinforce their belief that you were the right candidate.
You are almost guaranteed to be asked the above question one or more times during an interview process. And nearly every interview preparation guide advises to research the company. So everyone should have a great answer. Right? Then you might imagine my consistent disappointment at how poorly most candidates answer this question when I ask it in an initial phone screen.
The answer I most frequently receive: “Well, I’ve used your software, and I know you’re based in Seattle. . .” and that’s it.
I’ve said this before, and I’ll say it again: The interview is the final exam of your job search–but in almost all cases the only two grades given are A or F. I recommend preparing accordingly.
How? There are a lot of potential information sources:
- The Company Website: (I’m using my friends at Oracle for this example): This can provide information on the company’s history, mission, strategy, products, locations, and be sure to check out the massive amount of information about the Execs and Board of Directors, information on their Press and Social Media channels, about their Corporate Citizenship…it’s a vast ocean of knowledge. You could (and should) spend a LOT of time on just this site alone.
- Google and Google News: Google allows you to search for information about the company, while Google News aggregates any news articles about the company. I highly recommend setting up Google Alerts for all companies you are targeting, and set it to send you daily digests.
- LinkedIn: Review the Company page on LinkedIn for basic company information, recent updates by the company and its employees, an overview of key products/services, and–whatever you do–ensure you Follow the company–because good recruiters look to see if you are. Look through your contacts: Do you have any either 1st or 2nd level connections that list your target company as a current or past employer? It is worth reaching out to gain their insight on the company (and who knows, maybe they know the hiring manager). I also highly recommend learning what you can about the recruiter who contacted you and–if possible–each member of the interview team. (It gives you an opportunity to understand their background and gives you a way to potentially build rapport through a shared prior employer/alma mater.)
- Yahoo! Finance: Especially useful for Public companies. Provides a snapshot of market performance and financials. Also links to recent news stories.
- Twitter: Follow the company on Twitter, and search for the company being mentioned. What are people saying about it?
- Facebook: Same thing–like the company page and ‘passively listen’ to what people are commenting about. Are they happy with the products or services?
- Glassdoor: Glassdoor is a crowdsourced company information and review site. Current/prior employees may volunteer salary information for various job titles–useful in potential offer negotiation. Additionally, current/prior employees can provide company ratings/reviews. I highly recommend applying a critical thinking filter to these as you might a product/service review on Yelp. Many of the people that post to Glassdoor are those that have left the company on poor terms–for instance through a RIF or due to what they perceive as a poor work/management situation. Consider the feedback–then make up your own mind.
- Hoovers: Significant amounts of information available here–for a fee.
- Main/PandoDaily/GeekWire: Looking for a job at a startup or in tech? In Seattle or the Bay Area? Follow these three sites. Daily. Subscribe to them. Follow their leaders on Twitter.
That’s just a few resources of the multitude available to you. So what do you with with all of that information once you have it?
Well, first off–study it. Learn it–at least the basics. Understand the financials; they are key to the health of the company. Know who the key players and products are. Understand what’s going on with the company, and with their key competitors. This will help you not only be able to blow away the interviewer, but you should also be unlocking questions you’d like to have answered in the interview process about the company, product, leaders, financials, etc.
Again, I repeat: This is the final exam of your job search. Do you want an A? Or an F?