Should I Reveal My Compensation to a Recruiter?
There are a lot of opinions swirling around on the Internet about this topic, and there are many people who will take my opinion with a grain of salt because, well, I am a recruiter. In the eyes of some people that automatically makes me evil. So I want to give a few disclaimers:
- The following is from a general perspective — an amalgamation of my experiences at all the companies for which I’ve worked for Facebook, Google, Expedia, LivingSocial, Nordstrom, and more.
- Secondly, it’s not all about money. There are a lot of factors that go into why you accept a job. Let’s not be so shallow. But this article is going to focus on money, so let’s just push all that other stuff to the side for now.
- Thirdly, this is not a summary for short attention spans. I’m not sugarcoating. I’m going in depth on compensation and I’m not giving “Top 5 ways to land the salary you want.” If you’re not up to hear the real deal behind the scenes, stop reading here.
- Lastly, and most importantly, I’m pro-job seeker. So everything I’m about to write is in that vein. Deal? I aim to pull back the curtain a bit on what’s going on in the recruiting process and help people be more successful in achieving their ultimate desired outcome. In the years I’ve worked in recruiting I’ve seen a lot of shenanigans on both sides of this equation and I have a really low tolerance for all of it. Recruiters need to do better and be more honest, and candidates need to stop believing every random fly by night salary advice they read on the Internet. Also, everyone should stop watching “The Boiler Room.”
We recruiters have compensation conversations all day long so this is a comfortable arena for us. It’s part of our job. It’s old hat. Candidates in the interview process, however, tend to be far more green or on the defense on the topic of compensation, and with good reason. There are some wild tactics going on in the recruiting world. I’ve heard all sorts of craziness like companies giving a candidate one hour to decide on an offer and then pulling the offer altogether. What a great way to build trust with candidates! This type of stuff makes me think we need some type of inner healing workshops (complete with trust falls) for every candidate who’s ever been personally victimized by a really bad recruiter. I’m Robin Williams, and I’m hugging you while simultaneously repeating, “It’s not your fault.”
When we start talking about money, sometimes I can hear people sweating through the phone. Here’s the thing — it’s really not that big of a deal. This is not like going to a car lot to buy a car. Someone isn’t trying to stiff you. And if they are, it may be time to re-evaluate why you’re even in the conversation. If you approach compensation conversations like buying a car, you’re setting yourself up for agony. There is no part of this conversation that has to get awkward if both parties are bringing their authentic selves.
Debunking some salary myths
It is not, I repeat, not a recruiter’s job to get the best talent at the lowest possible price. That’s how you shop at Wal-Mart; that’s not how you hire the best and brightest in any industry. Despite how logical this sounds, many job seekers choose to take on this disturbingly adversarial relationship with recruiters because of some really bad advice they found on the Internet.
The advice I’m about to give is not that.
For starters, allow me to debunk a common myth for you about most recruiters: We actually WANT to pay you well. No, really. Our interests are not in conflict with yours. There are no valid reasons why an in-house corporate recruiter* working for the company at which you want to work would want to lowball or snub a candidate on salary. We get no added benefit from it, and ultimately in the long run it would just come back to bite us by way of a now pissed off, underpaid employee, hearsay in the market, or worse, turnover. We have to pass people we hire in the halls. We need to be able to look them in the eyes and feel good about ourselves! We don’t get paid per hire. We don’t get bonused based on how low of a salary at which we close each candidate. What a miserable life we’d lead were that the case. The only thing that matters to us is that you accept a job that’s a good match to your skills and you’re happy with how we treated you during the process. With the way people talk nowadays and publish their salary information online via sketchy anonymous mobile apps, it’s just silly not to pay someone a fair market rate. We recruiters actually sometimes have to go to bat for candidates to get more money than what we’re “allowed” to offer by maneuvering processes, pay bands, and other checks and balances within the organization in order to compensate you the way we want. So be nice to us. We’re absolutely on your side.
*Retained search headhunters are a bit different. For many, they are paid based on a percentage of the total salary they obtain for you. So in that case it might be in their best interest to obtain for you the highest salary possible because their compensation is proportionate to yours. Agency recruiters are the ones you need to watch because their interests aren’t always aligned with yours, and here’s why — they are often paid on a spread. This means that their agency is paid a bill rate (e.g. $120 per hour) for you, and the agency in turn shares a cut of that with you (e.g. $55 per hour). So in that case, $65/hour (the difference) would be the spread. There is a cost of doing business associated with that spread such as employer taxes, L&I, unemployment, sometimes benefits, PTO, etc., and then of course overall profit, but there is still wiggle room there to play. What hourly rate a recruiter extends to you is highly negotiable based upon how much of that “spread” money the agency is willing to give up in order to get your butt in the seat.
Timing it right
Sometimes we recruiters have the compensation conversation up front, and sometimes we wait until way later in the interview process. Sometimes it depends on the company and how aggressive their compensation packages are. If a company has great salaries, recruiters may feel less of a need to suss out salary requirements early on in the conversations. Whenever the comp conversation is had, it’s an important one. Recruiters don’t like to mess around about money. We don’t want to waste our time on a candidate who at the end of the day, we can’t afford to hire. We don’t want to waste your time either. When a recruiter is trying to get salary details from you, we’re often trying to figure out if we can afford to make an offer compelling enough for you. We’re also checking to see if we need to reset your expectations. By the time you receive an offer, there should be no surprises. Recruiters hate surprises, and so do candidates (unless of course, they’re really, really good surprises). Get it all out on the table. The more honest you are, the more honest we can be with you.
Answering the question
So “Should you reveal your compensation to a recruiter?” The quick answer is, “It depends.” You don’t have to divulge all the details of the components of your compensation, but you need to give the recruiter a clear idea of what your expectations are. Even a range is a wise idea.
Example answer to the question: “Right now I’m expecting a salary range of $X — $X, as well as a bonus of Y and I’d be walking away from X which is supposed to vest in July.”
You might even emphasize what component of the offer is most important to you in a total package. You don’t need to state the specific salary you have, but it would behoove you to give a range of what you’re expecting. Otherwise it looks like you’re just fishing. It’s perfectly fine to want to try to get a higher offer than your current salary, but the way to do it isn’t to be ambiguous. That could backfire very badly for you.
If your salary is below market rate for your experience/position, then you should give the range that matches market rate. If your current salary is already very competitive, and you’re sure of that, it actually might help you to state exactly what your current compensation is. Because then the recruiter will either:
- Say, “There’s no way we can match that, but we could do this…” or
- Go behind the scenes and fight to get you an even better, stronger offer than your current salary
- Tell you all bets are off and stop you from wasting your time
State your expectations early and with clarity
Be honest and upfront and don’t be wishy washy, or try to pull a bait and switch later on. I can’t tell you the number of squirmy comp conversations I’ve had with people about money. Discomfort creeps in when people are trying to follow some slimy negotiation advice they read on Brazen Careerist, or I don’t know, the back of a tarot card or something. If you’re being candid and honest, there’s no reason this part of the job search process has to be uncomfortable. During my career, I’ve talked to grossly unremarkable management consulting candidates with <10 years experience who’ve told me with no qualms that their minimum base salary expectations are $300k. Their voices weren’t trembling. They weren’t nervous or uncomfortable. They were 100% comfortable disclosing that. Why? Because they were telling the truth! And regardless of if I personally felt they were worth that amount of money, that’s what they were commanding in their current positions. I knew that on good sources. So it was up to me to be honest with them about if they would see that same earning potential by moving over to the company I represented at that time.
I can already hear your objections — “But what if my current salary is too high and I price myself out of the job?” Well let me ask you this: if that is your concern, then that means you must have a lower (than your current salary) salary range that is acceptable to you, right? Right. If this is your situation, then give a range that includes both your current salary as well the lowest salary with which you’re comfortable according to your standard of living.
Someone who is currently making $300k isn’t going to say they’re okay with making $50k a year. So why bother trying to continue a conversation with a company that can’t even pay you on the low end of what you want to make? Best case scenario is the company decides they’re willing to totally bust their pay bands on your behalf and they pull together the most competitive offer they can (which is still lower than you prefer), and you end up joining the company at the top of the pay scale with no chance for comp increase short of a major promotion. Personally, I think if a company can’t pay you at the bottom of your desired range, it’s not even worth continuing the conversation unless the company has a heck of a lot more to offer than just compensation (i.e. great learning opportunities, high equity upside, more interesting work). That’s why you need to figure out your expectations. It’ll save heartache all around.
Be Realistic. Know The Market. Know Your Value.
Stating salary expectations doesn’t mean you have to explicitly name your salary, but you should always give a range. You need to know what you’re worth in the market and what you’re willing to live with. This is not a fishing expedition. If you’re using job interviews as a way to go fishing for salary ranges, you’ve managed to be lazy in the most tedious way possible. Congratulations. That’s quite a feat.
In some cases, you might be looking for a new job because you know you’re underpaid and feel like you don’t want to divulge your current salary for fear of getting a “low” offer. I understand that sentiment. You don’t have to divulge your actual salary, but your comp expectations should to be within what the market commands. Also, if you’re coming from a company that notoriously underpays (for example, retail companies often pay under market value), sometimes it’s best to state that you believe/know you’re currently underpaid compared to the market. It shows you’ve done your research, and it shows the recruiter you’re being honest.
A lot of people feel like changing jobs is a perfect time to increase their salary. And it is. But if you are making $100,000 in your current position and you have done nothing to increase your skill level, and you’re interviewing for a lateral position, what makes you think another company should automatically pay you $175,000? I’m not saying it can’t happen. It most certainly can, but people need to reset their expectations about what percentage increase they are most likely to see by changing jobs. If you’re expecting a pay bump, expect a realistic one. Remember, you’re an unknown talent and the company is taking a risk on you as much as you’re taking a risk on the company.
Here’s how a typical conversation goes with someone who’s being unrealistic about salary. Before you accuse me of being over-dramatic, I must promise you I’ve had this exact conversation many times over during my career. I wish I were lying, but alas, here goes:
Candidate: “I’m looking for a salary of around $185,000.”
Recruiter: “Well, for this particular position the salary range is more around $85,000–95,000, tops.”
Candidate: “Oh okay. That works for me.”
What the what?! How does a person go from expecting $185,000 to being okay with making $85,000? I’ll tell you how. They were lying and decided to go on a fishing expedition trying to see how much they could make. Don’t do that. Ask for a salary range that’s at least commensurate with your experience. It’s even okay to ask for a salary range that’s ABOVE your experience, but don’t get all crazy shopping for yachts if you haven’t done your homework.
If you know a particular company can and has paid people with your experience a certain salary, it’s perfectly fine to have hopes for a similar salary. But don’t ask for the salary of a VP level or rock star status Twitter employee number fifteen if you are not a VP or a rock star. Don’t overhear that a friend received an offer of X amount from a company and then automatically assume that some other company should be paying you that as well. That company may have an entirely different pay range and there are also internal equity issues at stake. Also, your “friend” may have more in depth experience in an area that’s highly valued at X company, but may not be valued at Y company. There are lots of variables around comp. If you’re interviewing at the same company as a friend you know and you don’t get the same salary as your friend and wonder why, you should be prepared for the tough conversation you may have to have when you find out that the reason your friend got a higher offer than you is because your friend is in fact, far better than you…ouch. See why you don’t want to even go there?
You have far more leverage around salary if A) You are sitting in a job you absolutely love and you don’t really HAVE to leave or B) You are being wooed or C) You have another, higher offer. If you do not hold any of those cards, I recommend jobseekers tread lightly with taking artistic license around compensation.
Stop car-buying tactics
One of the more commonly seen approaches to salary discussions is when a candidate flat out asks, “What is the salary range for this position?” Look, I get that when you’re buying a car, whoever answers the money question first loses. But you’re not buying a car. It’s a valid question, but you may not receive the answer you want. When candidates ask this question it can come across like they’re not authentically interested in the job itself, but rather just the money. Companies don’t like to release their salary ranges. There are debatable reasons for this, but going into that philosophical debate isn’t a good use of your time when you’re probably reading this to gain insight on understand salary negotiations. People love to have the “all companies should just make all their salary info public” debate. I’m not really here for it because it’s draining and counterproductive. Also, if you want to go work at a place where you can know exactly what everyone makes, the United States government is hiring. I hear their benefits are decent. It’s highly likely the average recruiter you’re working with is working within a finite compensation context anyway, so in a lot of ways, it really shouldn’t matter to you what a company’s salary range is. What should matter is can they pay you want you want to make? Is this a place you genuinely want to work? And where are you willing to sacrifice if the latter outweighs the former?
If you don’t know the answer to what do you want to make, then you might want to figure that out before you go job hunting. Every position at a company has a pay range and that range is often iterative based on experience. At established companies, internal equity doesn’t often allow a recruiter to “lowball” someone outside of the range of the position into which they’re being hired. If someone tells me a salary range and it’s far lower than what we would pay that person, that person would still need to be paid fair market value. I can say this because I have integrity and I have worked for companies with integrity. Some companies might be shady in that way and lowball a person, but if a company is that shady, then you may not want to work there. No, in fact, I can say with great conviction that you don’t want to work there.
If you do tell, tell the truth
One of the great perks of being a recruiter is being privy to a lot of salary data. We have friends that work for all types of companies. We have charts, and data, and awesome compensation specialists within the company and all types of information we acquire over the years of talking with different people from different companies. If you currently work for one of the better known companies, chances are we already have a good idea of what your currently salary might be. This is why if you are going to state your salary, you should never lie. If you’re feeling the urge to lie, just state your expectations instead.
Don’t bank on a fairytale ending
Don’t go through an entire interview process on a “hope” that the compensation is going to magically align with your expectations if you don’t have good data to support that. There is some prevailing advice out there that if you go through the interview process and the hiring manager falls head over heels in love with you, they will open up their wallets and pay you whatever you demand. If you’re under this delusion, you’ve been up late watching too many romantic comedies. Truthfully, yes there are some companies out there like this, but not a whole lot, and even the ones that used to be making it rain everywhere seem to be pulling back the reigns a bit. Moreover, to be one of those people who commands cart blanche type compensation offers, you better be so amazing and kill the interview so hard that the walls of that conference room are still smoking from the mic you dropped with your coup de grâce.
The reality is the average Joe company (i.e. NOT the companies whose quarterly earnings equal the entire annual GDP of Rwanda) has a budget and a range within which they can pay you. They’re probably not going to absurdly bust the wallet to hire you. If you’ve gone through the entire interview process knowing this, yet hoping for a miracle, you might be in for disappointment.
This “bait and switch” technique will work for about 2% of the workforce. If you believe you are that 2%, then have at it. But I promise you if a company is going to go crazy for you and want to pay you a ridiculous sum of money or make a very strong above market offer, they will know this well before they even begin the interview process and frankly, you will too — especially if you have competing offers. I can’t tell you how many candidates throughout my career arrived to the end of the interview process and were shocked or frustrated when the company offered them exactly what we told them the salary range would be.
If you can’t trust now, you can’t trust later
Jobseekers really need to develop a strong philosophical point of view on how they process compensation discussions. If you approach a company or a recruiter as though they are untrustworthy and the enemy of your soul, then why on earth would you want to work for that company? That thinking is fundamentally flawed. When people ask me for advice on salary negotiations, I tell them that the interview and salary discussions are like dating. When dating, people put on their best behavior. In marriage, the true colors come out. If the company is putting on its best behavior and it’s rubbing you the wrong way, that’s a problem. Find the company that is willing to be honest and make a fair attempt pay you fairly and competitively with relative ease and that company will likely have a similar philosophy throughout all stages of your career there.
It’s all about value. There are a few companies who shall not be named, who are known to make the entire interview and salary negotiation process a huge pain for candidates. These same companies are also known for being overly frugal and cheap when it comes to any types of perks for employees. That shouldn’t be a surprise. If you had to fight the company tooth and nail to get an extra $3k added to your salary offer, which is already lower than it should be compared to market rate, is it really worth it to you? Is that really the place you want to go spend the next 5–7 years haggling over every raise and every promotion? I’m just saying. If comp isn’t everything to you (and it really shouldn’t be) and there are other awesome things to love about the company, then have at it. But if you feel as if you can’t trust the company or recruiter to make you a good offer, you have far bigger problems than salary negotiations on your hands.