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Underpaid since your last job? How to catch up

April 30, 2015, 6:32 PM UTC
Photograph by Bart Sadowski—Getty Images

Dear Annie: I’m in an awkward situation, because I found out recently from a reliable source that my peers (all male; I’m the only woman here) make significantly more money than I do. So I did some research online — which I now realize I really should have done before I accepted this job — and found out that my pay is well below local “market value.”

Looking back, it seems to me that’s at least partly because my current employer based my starting salary on what I made at my last job, which was in a different city where the cost of living was much lower. Now, I’d like to catch up and, although I could just ask for a raise, I want to be sure to frame the discussion so that I get what I want without coming across as obnoxious. Suggestions, please? — Low-Balled in L.A.

Dear Low: You’re smart to put some careful thought into this, because reams of research have shown that women walk on extra eggshells when it comes to negotiating, whether for more money or for anything else. Being “too demanding” or “too assertive,” according to longstanding social norms, can brand women as less “likable” than their male counterparts, even with no difference in bargaining tactics—which might be okay if “not likable” didn’t also mean “not likely to get promoted.”

“‘Just do it’ is a fine motto for a sneaker company, but we have to live in the places where we negotiate, so we have to adapt,” says Margaret Neale, who is a professor of management at Stanford’s Graduate School of Business who specializes in negotiation.

People marching forth into salary negotiations “often expect it will be a battle, which makes us approach it that way—and we get what we expect,” Neale says. “But it isn’t a battle. What you want is not to beat the other person, but to influence them to see things your way, so that you each come out of it having gained something. You need to approach it as a mutual problem-solving discussion.”

Bring the facts and figures you’ve found showing you’re paid below market value and “present the evidence, but not in an accusatory way,” she advises. “Convey that you know your boss wants to pay you fairly, but that there has been an oversight he might not even be aware of. Assume benevolence. Then ask how you can understand the discrepancy.”

Since it’s in the company’s best interest to pay its employees competitively, “the tone of this conversation should be, ‘How can we get where we need to go?’” says human resources consultant Molly Anderson . “Always approach it in terms of ‘we’.”

Anderson, who was formerly director of talent at Deloitte, is currently CEO of diversity consulting firm Exponential Talent. Among other things, the firm conducts pay audits (including a recent one for Gap Inc.), aimed at spotting and correcting anomalies.

She’s also one of a growing number of voices advocating for companies to not pay new hires based on what they made at their last positions or what they’re able (and willing) to negotiate for now but instead according to what the job is worth, as Google does. That means that some people joining the company take a pay cut while others get a raise, Google’s “people operations” chief Laszlo Bock said recently during a talk in Washington, D.C. But in either case, “we figure out what the job is worth, not the person” and pay accordingly.

“It’s to a company’s advantage to pay people according to how valuable the role is, rather than based on their skill as negotiators,” says Anderson. “Does it really make sense to create a situation where the most money goes to the best negotiator, whether or not he or she is better at the job?”

Good question, but in the meantime, for you and anyone who wants to get better at this, Margaret Neale recommends checking out these (free) online videos: Lean Negotiation; The Power of Effective Negotiation (a Stanford “breakfast briefing”); and a Stanford Innovation and Entrepreneurship Certificate course that is open to all, Negotiation: How to Get (More of) What You Want. Good luck.

Talkback: If you’ve ever negotiated a significant raise (or something else you wanted), what approach worked for you? Leave a comment below.

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