From CBIA News, March 2001

Minimize need to negotiate salary with job candidates

By Chris Amorosino

Free-lance writer in Unionville

Do you frequently find yourself negotiating salary during a hiring interview? You shouldn’t. Human resource experts say that small-business owners can nearly eliminate the issue of salary negotiations for all but top-level positions. The key is following a few simple guidelines.

Have realistic salary ranges in place. Susan Baum, director of human resources for Orange Research Inc. in Milford, says small-business owners must have realistic salary ranges in place for all positions before beginning the hiring process. 

Fred Rhines, president of Remedy Intelligent Staffing in Danbury, agrees. He says business owners sometimes call to complain that their ads have run for two months with no results. When Rhines investigates, he often finds the company advertised an unrealistic salary that’s well below the going rate.

To set salaries realistically, Al Hajek, a retired Northeast Utilities vice president who is now a human resources consultant for SCORE (Service Corps of Retired Executives), suggests contacting people in your industry or local area who run a business similar to yours. Compare pay ranges with them. 

Baum recommends CBIA consulting services. (CBIA also publishes a biennial Compensation Report based on surveys of Connecticut businesses.) Industry trade groups and chambers of commerce can also be good sources for salary-setting information and advice. Rhines advises clients to check the Web at sites such as www.salary.com. 

When hiring, make sure the open job’s salary ceiling fits within the overall company salary range structure. For example, if you’re hiring a customer service representative and pay current reps $30,000 to $35,000, you don’t want to offer $39,000 to $43,000 to a new candidate. 

Thoroughly describe the job. Explain the job well in your advertising. Listing all the major job responsibilities helps attract the right candidates and prevents interviewees from feeling a disconnect between the job as advertised and the job as described later in the hiring process. Candidates who feel surprised by additional job responsibilities late in the hiring process can legitimately say they didn’t know all you were requiring and ask for more salary to compensate. Rhines and Baum both advocate putting the salary range in your advertising to eliminate unqualified people calling you. 

Interview only candidates in the range. Ask candidates to submit their salary requirements along with their resumes. If good potential candidates don’t submit their salary requirements, Baum calls them before the interview. She’ll ask for a ballpark salary figure, explaining that she doesn’t want to waste the candidate’s or the company’s time if there isn’t a good salary match. 

Even if you make all the right preparations, Rhines says you still will have some people come to an interview hoping they can talk you into paying more. Or, you may want to stretch to see if you can lure an ideal candidate. This happens more often with senior positions or key players. Hajek refers to these employees as “gold-collar workers.” They are people who can make an immediate, strong impact on your business success. For an upscale restaurant, a chief chef might be a gold-collar worker. In a retail firm, the buyer might fall into this category.

Offer incentives to outstanding candidates. Gold collar or not, if salary does become an issue, Rhines says one line of defense is to say something like, “We’d love to have you on board. However, we can’t go outside the salary range. Why don’t you join us, do a good job, and we’ll review your salary in six months.” (If you make this kind of promise, be sure to follow through. Oral employment promises may be legally binding.) This often works if you’re close to an agreement.

You can also go into the interview with a few incentives you’re comfortable offering to the right candidate. Hajek suggests considering paying for additional training; an extra week of vacation; shares in the firm; or additional health benefits, insurance or other fringe benefits. Something as simple as letting the candidate choose a more enticing job title can sometimes bring the right candidate on board.

Be honest. More than anything else, Baum recommends honesty. Hiring a terrific person who holds misleading assumptions or false impressions about the scope of the job is counterproductive for both the employer and the employee. “Without honesty, you end up with an unhappy employee, and life’s too short for that,” says Baum. 

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