How Often Should You Renegotiate Your Salary?
Although some companies provide formal reviews, at many employers, it’s up to you to set aside time to advocate for yourself and ask for better pay. But how often should you be doing this?
A recent survey conducted by Elements Global Services found that 29% of employees had not discussed their compensation with their employer in the previous two years. An additional 51% had talked about it one to two times in two years, and 20% had talked about it three or more times over that same period.
This year is actually a great time to renegotiate your salary. Employers are planning to give bigger and more frequent raises this year after seeing many employees quit during The Great Resignation. Companies are planning to give existing employees a 3.4% salary boost in 2022. That’s up from a 2.8% boost in 2021. To find out how and when employees should ask for a raise, GOBankingRates spoke to career and human resources experts to get their insights on how often you should renegotiate your salary.
Your Annual Review Is the Ideal Time To Ask For a Raise
If your company offers an annual review, you should use this opportunity to ask for a pay increase.
“Usually the company has a budget, and your goal is to get as much of it in your salary as possible,” said Mary Sullivan, co-founder of Sweet but Fearless, a career transformation specialist business.
Go into the review prepared to make a case for why you deserve a raise.
“Track on a progress worksheet or file all of your accomplishments, and any new certifications and skills acquired,” Sullivan said. “Your negotiation plan [should] be based on your accomplishments, but also can bring in competitive analysis from sites such as Glassdoor or Indeed.”
Even if your company does not offer a formal review, you should still be discussing your compensation with your manager or employer on an annual basis.
“This gives you a full year to build your case for an increase,” said Ken Docherty, an executive recruiter and owner of Docherty Career Management Inc.
Compensation Should Be an Ongoing Conversation
Jenna Carson, HR director at Music Grotto, doesn’t believe that salary conversations should only be happening every one or two years — she believes it should be a conversation that is brought up any time specific milestones are reached.
“Every time you get an external job offer or every time you complete a great project that goes above and beyond your job description, that is the time to have a conversation with your boss about salary,” she said. “Having these conversations regularly will let your manager and HR department know you’re serious about getting what you deserve. Plus, it’s very rare a company will offer you the maximum they’re willing to go for your role within the first few discussions, so regular chats will help the negotiation go the way you want it to.”
Sullivan also said that you should also ask for a raise any time you acquire a new skill or the scope of your responsibility changes, especially now when employers are finding it hard to keep employees.
“[Ask for a raise] when you have acquired a new skill, certification or degree,” she said. “The thought is you will add more value to the organization and leverage that new knowledge. When asked to take on more responsibility or scope, you should negotiate a salary increase at that time. It is a great opportunity to improve your salary, even if not by promotion.
Remember That Timing Is Everything
There may be certain circumstances during which it would not be the best idea to ask for a raise, even if you reached a milestone or are heading into an annual review.
“Be mindful of what’s going on in the company,” said Lauren Cohen, executive and career coach with Positive Coaching Now. “If the company is going through a round of layoffs with tough times, play your cards and do not ask for a raise. Timing is everything. Lay some groundwork and ask when would be a good time to schedule a meeting to have a performance evaluation. It is implied when asking for this that you will probably ask for an increase if it isn’t offered to you.”
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Sam DeBianchi contributed to the reporting for this article.