As we approach the end of the year, it’s normal for technologists to start thinking about their annual reviews—and their next raise. But 2020 is far from a normal year: Many companies have put performance reviews on hold, while others have given individual managers much more discretion when it comes to incentive and bonus payouts.
Employers are planning modest pay increases of 2.8 percent for all employees in 2021, according to Willis Towers Watson. Contrast that with nearly half (49 percent) of tech talent expecting a minimum raise of 10 percent over the next six months, and you have a recipe for some awkward conversations.
But all isn’t lost. Any technologist who’s managed to accomplish their goals in 2020 can potentially negotiate for a solid raise—provided they take the right approach. There’s more to be lost by not trying, noted David Ginchansky, a career coach at Korn Ferry Advance.
In that spirit, here’s some advice for negotiating a salary increase during a very unusual time.
Understand the New Landscape
While some technology companies have been able to survive the COVID-19 disruption better than others, don’t assume that the old rules for pay raises still apply. Companies’ goals have changed over the past several months, and many are wrestling with reduced budgets and lower revenue.
According to data collected by global consulting firm Korn Ferry, 22 percent of employers plan to make significant changes to compensation programs over the next six months to two years. In fact, many companies have altered their rewards programs midstream, Ginchansky warned.
Unless you understand when salary freezes will end, how raise percentages and budgets are being determined, and the timeline and individual contributions that matter most, you can’t develop an effective negotiation strategy. Timing matters, too.
“You need to put your expectations on the table before the budgets are set,” advised Josh Doody, a salary negotiation coach. Otherwise, you may have to wait another year to score a substantial raise. Also, you’re less likely to become frustrated and lose control of your emotions if you have the conversation early, when everyone can have an in-depth conversation without deadline pressure.
Determine How Much Money to Ask For
Completely ignoring your company’s financial status when discussing salary can come across as tone-deaf, noted Caitlin McGaw, principal of Candor McGaw and ISACA speaker.
“Before you decide how much of a raise to request, do some homework and prepare the business case,” McGaw said. Hard-hit industries are projecting smaller increases for executives and staff, so review financial statements and press releases to get a sense of the company’s financial health.
After that, try to place a value on your contributions to the company’s business strategy and future success. How? McGaw suggests creating an inventory of all your recent projects; a journal can also prove useful for itemizing your accomplishments, especially if you make a point of updating it contemporaneously.
During such inventories, make sure to record the who, what, when, how, duration, scope, and most importantly, the positive outcomes, lessons learned and impact. For instance, did your efforts contribute to a reduction in the company's costs during the crisis, or drive a successful digital strategy that produced revenue growth?
It’s important to cite examples and clear evidence that your contributions are helping the company succeed, because you’ll need all of that when you sit down for a discussion with your manager.
Another thing to consider: market data. How does your compensation match up against other technologists with the same level of experience and skills?
Once you’ve done your research and prep, you’ll have ample evidence to back your claims that you need a raise. Show that you’ve made a substantial contribution to the health of the business, and your conversation with your manager will be far easier.
Be Your Own Advocate
Even as you’re itemizing your accomplishments, make sure that you share credit appropriately; you don’t want to claim too much of the team’s work as your own. It’s also important to keep in mind that everyone in your company has probably wrestled with professional and personal challenges over the last year—don’t overshadow their work.
Before your annual review, it’s important to “check in” with your manager on a regular basis and update them on your accomplishments; ask for regular feedback and a revision to your key performance indicators (especially if your job has radically changed). Frankly, many managers have just been too busy to notice that their team members have taken on more responsibilities lately.
“You should be tracking the added duties and responsibilities you’ve taken on since your salary was initially set,” Doody advised. Don’t wait for the annual review to hit your manager with a “data dump.”
These check-ins will also give you an opportunity to float a trial balloon on a potential salary increase. Use your manager’s reaction to further refine your approach to your annual review or formal raise request.
Fallback Positions and Flexibility
As the saying goes, you may need to take “several bites of the apple” to get the results you want. If your manager turns down your initial request, try to agree on a specific action plan and timeline to get the compensation you deserve,Ginchansky said. Alternatively, see if your performance might warrant a discretionary bonus.
Having a positive attitude and long-term outlook is important in the current environment. At the very least, walk away from your review with a commitment to revisit the idea of a salary increase when the time is right.