Negotiating benefits: where does the recruiter fit in?

How to negotiate benefits

When the time comes to move jobs, it’s easy for candidates to focus on the numbers: will I get a pay rise if I move to a new company? Will this move help me improve my earning potential?

But while basic pay is an important factor in the hiring process, recruiters also need to sell the ‘whole package’ to the candidate, and this will include benefits such as bonuses, use of a company car or a pension scheme.

In the current climate, it’s unusual to see huge salary increases when candidates change roles, so the benefits package can make all the difference in convincing someone to consider a role. According to pensions and benefits consultancy Mercer, benefits play a significant role in the decision to join an organisation for 30% of candidates, and 57% of candidates for senior roles would be more likely to join a company because of the benefits on offer.

Understanding the benefits

For the recruiter, it’s important to get to know the benefits their clients offer, many will have them set out in their terms and conditions. The size of your client may influence the benefits they are able to offer: a smaller company may be able to tailor their package to a specific candidate, while larger companies may be quite rigid.

“The consultant’s role is to get the best possible offer for both the candidate and the client, by understanding the individual needs of both,” explains Keith Lewis, managing director of technical recruitment consultancy Matchtech. And while your influence on what your clients can offer as benefits may be limited, the feedback you receive from candidates on what they expect and what other companies offer will be welcome and will help to shape what they offer in future.

 

Promoting the right benefits

Of course, some benefits are more appealing than others, and much will depend on two factors: the sector you work in and where the candidate is in terms of life stage. Typically, when choosing whether to put themselves forward for a role or at offer stage, candidates favour financial benefits such as pensions and an annual bonus over more lifestyle related benefits.

But when it comes to considering the total package, other ‘softer’ benefits such as the ability to buy more holiday days, purchase childcare vouchers or cut-price training can influence the candidate’s decision. “Younger candidates without family commitments tend to prefer flexible benefits,” says Adrian Kinnersley, managing director of Twenty Recruitment.”Those with families favour life assurance, private healthcare, flexible working arrangements and generous maternity and paternity packages.”

Flexible benefit schemes, where employees can choose from a menu of a mixture of financial and non-financial benefits, are attractive to candidates, as research suggests that having more control over your remuneration helps you to feel more engaged with your employer.

Also, giving staff autonomy over how they work, while not a benefit as such, can be a deal-maker, so check out with your client whether they can offer something unique outside of their financial terms. Google, for example, allows staff a portion of time each week where they can work on whatever projects they want. “Flexible working and work-life balance are edging ahead of bonus culture and the trend is towards flexibility and employee choice,” says Kinnersley.

 

How to negotiate

Negotiating on benefits is something that should happen the minute the job specification lands in your in-tray. Recruiters can benchmark the benefits on offer in the market, and should communicate this information to clients.

Similarly, it pays to be upfront with candidates about what’s on offer from the very start of the application process. “It’s up to consultants to keep clients in touch with changes in the competitive market on benefits, and make recommendations where needed,” advises Lewis. “Doing your homework on the benefits on offer and managing each party’s expectations should avoid an awkward negotiation at offer stage,” he adds.

A good way to sell the benefits package is to break down the monetary value of each element. So the company input into a pension, for example, might work out at the equivalent of an extra 5% on the candidate’s salary per year. An extra five days holiday compared with another company offering the same salary also makes financial sense. Gather evidence on variable benefits such as bonuses, if the company boasts a certain level of bonus, has it actually paid this out to people over the past three years?

In the event that the candidate is not happy with the benefits package at the offer stage, it will fall to you as a recruiter to negotiate. Sometimes, it may not be possible to alter the benefits available, but there may be some leeway on salary. Failing that, sell the overall advantages of accepting the offer, perhaps they will be working for a high-profile brand, or the client has a good track record for fast-tracking careers in that sector.

And if the client is simply not prepared to budge, perhaps your candidate is not their perfect match after all: “On some occasions we have pushed back to the client with a final offer, and this weeds out if they are actually interested enough in the candidate to make that change,” says Lewis. “The way you deliver the negotiation pitch can make the difference as to whether the candidate or the client goes ahead.”

Ultimately, you could hold all the cards when it comes to negotiating benefits for your candidate. So keep abreast of what’s on offer in your market, be honest with your client and your candidate upfront, and remember to sell the whole package.

 

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