Technology pros have learned through education and experience that negotiating benefits and perks outside base salary can significantly improve their total compensation package.
Given the tightness of the tech labor market, managers have generally been willing to provide extra perks or incentives, like paid time off to attend conferences or work on side projects, to retain the services of highly skilled tech pros who ask for them.
But is pushing for “extras” still a good idea when big companies from Silicon Valley to Wall Street have been scaling back the perks many employees have come to expect?
Yes, you can still negotiate things beyond salary—provided that you use a targeted, strategic approach. Here’s a guide to negotiating “extras” as the “perk-cession” gains steam.
Focus on What Really Matters to You
Some employers may be closing the door on companywide benefit programs that have high costs and low employee utilization rates, but they’re leaving the window open to negotiate personalized, discretionary benefits that employees actually want.
Companies are reallocating funds to personalized benefits so they can have much greater impact on employees but still spend less, explained Amy Spurling, founder and CEO of perk management platform Compt. For instance, some companies are offering a lifestyle spending account or stipends that speak to their company culture and empower employees to purchase the things they want or need.
How do you know what's on the table and what isn't? It’s not about getting the most perks. It's about focusing your time, attention and energy on the things that really matter to you and your family, noted career coach Kyle Elliott.
Start by evaluating your current and future needs to identify which perks and benefits will have the greatest impact on your career, health, financial well-being and quality of life today and in the near future.
Then, figure out which perks and benefits are on the chopping block at a company and whether its revamped package will meet your needs before you apply, Elliott advised.
For instance, most companies are cutting things like commuter perks, fertility benefits, pet insurance, laundry service or unlimited kombucha. As long as the remaining benefits meet most of your needs, you can put your effort toward negotiating individual, one-off perks like flexible work schedules, professional development stipends or extra PTO.
Is being reimbursed for expenses related to adoption or surrogacy, child day care or student loans more valuable to you? Or are you at the stage of life where you’d prefer a larger 401(k) match and a paid gym membership?
In order to use benefits and perks as a criteria to determine if an employer is a good fit for you and your career, you have to know which ones matter most to you.
Do a Cost-Benefit Analysis
Take the time to calculate the total value of a compensation package including benefits and perks to see if it's in line with the local market and to identify gaps or shortfalls that you may be able to close by negotiating a higher salary, sign-on bonus or other flexible benefits.
For instance, it’s estimated that Google spends about $20 to $30 a day on food for each employee. So if you’ll be leaving that benefit behind, you’ll need to receive about $6,000 per year in other bonuses, salary or perks to stay whole if you need to work on-site every day.
For technology pros with a large family, receiving a fully paid or low deductible health plan might add thousands back to their pocketbook each year and offset a slightly lower salary.
Speaking of salaries. Cutting salaries is not a viable strategy for most companies, Spurling noted. So if you're interested in a position but the benefits don’t line up with your expectations, exploring alternative forms of compensation or a higher salary can be one way to bridge the gap.
Negotiate a One-Time Bonus
When the cost of benefits draws extra scrutiny from senior management, negotiating a one-time signing or performance bonus in lieu of extra perks may be the better option.
Companies are looking to reduce recurring expenses to improve the bottom line, Elliott pointed out. When that happens, it’s often easier for managers to push through a one-time expense rather than higher base salaries or ongoing perks that show up as recurring expenses.
Negotiate a Better Job Title
Negotiating a higher job title won’t just bolster your resume; it generally comes with a higher salary, bigger bonuses and more perks. Even better, managers often have the leeway to assign job titles.
Fringe benefits are determined by “job grades” or levels with different titles and salary ranges within a company. The perks and benefits you receive at a higher level are bundled in so you don’t have to haggle over every little thing, which can cause the other side to dig in or reject your proposal.
Previously, technology pros have successfully negotiated lots of perks, especially when compensation expectations could not be met. But in the midst of a perk-cession, asking for fewer things increases your chances of success. Today, negotiating for less is the new way to obtain more.