For whatever reason, the steps to negotiating a technical contract are shrouded in mystery. No one seems to know what to do. Or, if they think they do know, they often make mistakes that harm their relationship with their employer. This is why we’re addressing the 5 most common myths about technical contract negotiation. We want to make sure that you don’t believe these things, act on them, and then strain your relationship with the hiring company.
Myth 1: Negotiate Until You Get That Last Dollar
No one likes to be taken advantage of, especially by corporate America. To prevent feeling like they’ve been duped, many technologists fight tooth and nail for a certain rate. They shouldn’t.
Let’s think about this from a practical standpoint. Say you spend two weeks in-between gigs, trying to negotiate to your rate. You may finally get your rate, but at what cost? Is it worth it to negotiate for $1,000 more if it costs you another two weeks without pay? Odds are, probably not. You’re just hurting your wallet, and straining tensions with your future employers.
This being said, we’re not implying that you should automatically give in to the organization’s rate. If you have properly calculated your value and are being underpaid, you’re going to be frustrated by the lack of money. In many cases, this leads to resentment and a lack of productivity in the workplace. If the company absolutely refuses to give you what you are worth, even after factoring in benefits and perks, you can walk away.
Summary? While you shouldn’t work for 40% of your market value, you need to be flexible when negotiating rates with your employer.
Myth 2: You Should Lie About Your Current Paycheck
Oftentimes, a company will ask you what you’re making at your current position in order to determine an appropriate pay scale. While it may be tempting to lie about what you’re making (in hopes that you’ll get a higher rate), don’t. Many employers will request a copy of your most recent pay stub to validate what you said earlier in the process. They’ll realize that you were trying to pull the wool over their eyes.
By being truthful about your current paycheck, you’ll establish a trusting relationship with your employer. This has great implications for job prospects down the road. With a trusting professional relationship, they may call you several years from now to work on a project. Being honest ensures that people want to work with you in the future, which, in the long run, is more money in your pocket.
Myth 3: You Will Get the Same Rate Regardless of Location or Title
While many technologists believe that they should be paid the same for their skill set from locale to locale, this is not the case. You need to recognize that geography changes your value. If you were making $200,000 in NYC, don’t expect to be making that much in Portland, ME as the cost of living in the later is much less.
This also goes for skill set. If you were a hotshot COBOL programmer, you may take a significant pay cut as you transition your skills to Java. Accept the cut and create skills that add value to your employer. You’ll get your market value back up over time.
Myth 4: It’s Personal
While it’s easy to take a low monetary offer as a personal affront, try not to. It’s not that you’re not worth the money you’re asking. You probably are. A low-ball offer oftentimes results from a company’s budget and their assessment of the ROLE, and not from their assessment of your skills.
Myth 5: You Shouldn’t Talk To Your Current Employer
Oftentimes, people start to look for a new technical position because they feel that they are currently being underpaid. If you’re in this situation, go ahead and apply pressure with your current employer. Explain that you would like a raise, making sure that you are able to objectively state how you are adding more value to the company than you were initially. This can be done through clearly displaying additional responsibilities that you’ve been given as well as through exemplifying the knowledge you have acquired. A conversation such as this takes less time, and is often more productive, than going on a job search for competing offers.
In order to adequately negotiate your contract, you have to understand the myths. Once you remember that you don’t have to negotiate until you get the last dollar, that you shouldn’t lie about your current paycheck, that you won’t get the same rate regardless of location or title, that it’s not personal, and that you should talk to your current employer, you’ll be well on your way to negotiating a fair contract. Good luck!
Thanks to tsmall for the use of their respective photographs.