Personal Finance

How to Deal With a Low Salary Offer

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Last updated on July 25, 2019 Comments: 8

In my life so far, I’ve had three major chances to negotiate a starting salary. The first was with a cash-strapped non-profit organization that had enough problems keeping its payroll account funded every other week. The second was with a company in the financial industry, a segment of that industry that is known for being cheap in the salary department, particularly for an operational position rather than a business unit. The third was with the same company in a different location.

In all cases, I didn’t have a lot of room to maneuver. And rather than spending my time outside the office looking for new opportunities, I’m spending my time working for myself. It would be nice never to need to negotiate a salary for myself again; and in fact, it’s possible I’ll be on the other side of the negotiating table.

But I liked one of the ideas offered by Liz Ryan at Business Week for dealing with a hiring manager whose offer is lower than one feels they deserve.

Go back to the hiring manager and say: “Thanks so much for the offer. The job seems terrific, and I’m thrilled to be moving along in the process. We’ve had some kind of miscommunication along the way, clearly. I’m focusing on opportunities in the $XX range, and the offer I’ve received is obviously way below that number. If you’re set on this type of salary range, I’m not your hire, but it may make sense to talk about having me consult with you as you get your new plans under way and your new hire up to speed.”

At first, I didn’t see this as an option applying to any of my situations, but maybe it would have. And maybe this is not a bad idea for winding down my day job to begin focusing on my own projects full-time.

Liz Ryan offered a number of other suggestions, like accepting the job part-time (wouldn’t they use that as an excuse to lower the salary offer?), but I don’t seem them applying to most situations.

Lowball Salary Offers: A Working Guide, Liz Ryan, BusinessWeek via Yahoo Finance, March 23, 2009

Article comments

Anonymous says:

I agree in part with Amph that the wording of the original note from Liz Ryan is a little impolite, but I agree with Greg that getting too personal when negotiating salary is a no-no. Instead, I think by using Liz’s general template and polishing it up with more of a “Power of Nice” approach, it could be a very effective way to get the results you desire. After all, our smallest actions can often have a huge impact on our lives: it’s a great example of the Power of Small. Sometimes all you need to do is ask!

Anonymous says:

Every offer is (in theory) negotiable. A company saves money by not showing you their best offer and hoping you’re not smart enough to know that. Other companies have a non-negotiable number and probably don’t understand the value of that potential employee.

Anonymous says:

That would really depend on your position and their relative flexibility, no? Sometimes you can get a pretty good idea as to what your competition might’ve been and how desperately they want you. On the other hand, in times like now, it’s a pretty much an employer’s market, no?

Anonymous says:

Not to disagree with the OP, Flexo, because I do believe that there’s value in rejecting an offer politely and succinctly based on compensation, I *do* believe that the wording of your rejection is a little rude. I tend to have better results by saying something like:

“Thank you for the offer for the such-and-such position at your firm. After careful consideration of the offer, I’m afraid I need to reject it as an option for myself and my family. At my former position, my compensation level was $X and our family built a comfortable living and budget around that amount. To maintain that lifestyle, my compensation level with your firm would need to be within $Y and $Z. I realize that the extra $A (aside: This could be $400/mo, $300/paycheck, etc.) per check may not seem like a huge drop in the bucket of the corporation, but to my family, this is the amount of gas I would use to commute to work (aside: or the groceries we burn through a month, or my electric bill or …etc.). As you can see, without that small amount of compensation more than what I have been offered, our family would suffer. Thank you for your time and consideration; should the circumstances or specifics of your offer change, please do not hesitate to contact me.”

This allows the employer to look at you like an actual person, to consider what $400 extra would do for him each month, to consider the effect of money on a family. It also shows him that you’re methodical in your reasoning, that you ran the numbers, and that you’re able to provide alternative solutions instead of simply complaining about the problem. Finally, it shows you’re still very interested in the company for taking the time to do this, and to request that they contact you if anything changes. It indicates that your only hang up is the compensation and that you feel that this job would be a good setting for you and the company.

Anonymous says:

re: Amphritrite

Polite is good, but the comfort level (or survival level) you and your family has no bearing on your worth to the company. If a justification is offered, it has to be based on the value that is brought to the employer.

Also, keep other avenues of compensation open. What is the health plan like? Is there tuition reimbursement? A car allowance? If the extras are right, it can make up for a low salary.

Anonymous says:

I still disagree – any good company that actually wants to survive knows that an unhappy employee is the cancer that will kill any hopes of survival in this kind of economy. In corporate America, I realize that there is no employee or employer loyalty, but at the same time, an unhappy employee has a higher chance of slacking, letting the ball drop, and creating more work for others.

Let me ask you this – would you rather your new hire was the RIGHT person for the job, or would you like to pay someone less to do a slightly less fantastic version of what the RIGHT person would? I agree with Anca – every job is, in theory, negotiable, and the ones that are not are the ones you want to avoid all together (meaning, you’ll have to fight tooth and nail for a very minor salary increase, more paperclips, and to put together your own team for a specialty project).

As the director of the HR department at my current job, I can honestly say that when we hire, we are negotiable and we do take into consideration the RIGHT person over compensation. If we find the RIGHT person, we’re more inclined to negotiate a package that is good for both parties. Think of it more like a legal discussion between two lawyers than a little-guy vs. big-guy theory.

Anonymous says:

I enjoyed that article too, very well put.
In theory.
When you want a new job and you like it, it’s hard to feel “in control,” especially if you aren’t working at the time. I was nodding throughout the whole article but then later thought to myself, “Would I really say that if I were in that position?”

Probably not.

Anonymous says:

It’s surprising how willing companies are to hire consultants. When a woman in my group left last year the offered her a consulting position after hours for 3 months. I convinced them it was a waste of money but that is another story.

I wasn’t able to negotiate my salary but I did manage to qualify for a greater chunk if our group’s bonus because of my willingness to train new hires.