Negotiation 101

After successfully placing a candidate into a job, next comes the tricky task of drawing up and agreeing on a contract with the employer. It’s so important to get this right from the start, as it will avoid conflicts down the line. But knowing where to begin is difficult. Luckily, we’ve put together your essential guide to getting started with negotiating.

 

What can be negotiated?

There are several elements to a job contract which can be negotiated. These can range from the salary, the payment terms, the amount of holiday all the way to notice periods at the end of the employment.

Naturally, employers will want something which works in their best interests, and protects them. For instance, they might want to include a clause which prevents an employee from approaching business clients for a given length of time after leaving employment.

However, an employee will also be looking for a contract that gives them the best deal, so it’s all about striking the best balance between the two to come up with something that suits everybody.

If you’re a recruitment agent, you should also expect to negotiate the percentage fee for your services. Daley Pritchard, Director of Non-Core Banking and Financial Services from Communicate Recruitment Solutions says, “Fixating on this to the exclusion of other factors can prove fatal. You need to look at the big picture: how is the percentage fee calculated, what is the rebate period, what are the payment terms, who has the right to represent a candidate, are there any exclusivity clauses?”

 

Before the negotiation

Before entering into a negotiation, or even putting a candidate forward to a client, there are several things you need to do.

It’s crucial you find out:

  • Current and previous salaries
  • Minimum salary requirements or rate expectations
  • Current bonus schedule (if any)
  • Availability of the candidate to start work.

As salary is likely to be the element most challenged by both employer and employee, it’s essential you get this pinned down straight away. If you’re going to go in all guns blazing for a higher salary, try and get an agreement from the candidate so you know they’ll definitely take the job if the figure is achieved, you don’t want to risk a relationship with a client for the candidate to walk away at the end of it.

Daley Pritchard says, “Expectations need to be set and agreed upon prior to submission for any role and, where possible, confirmed in writing via email. Expectations should then be continually managed throughout any subsequent process.”

 

Dealing with problems

Alan Lewis, partner and head of employment at Linder Myers solicitors points out some pitfalls which recruiters need to be aware of. “The T&Cs may include terms restricting the employee from taking employment with a competitor or approaching clients once they terminate their employment. This can have a detrimental effect on their long term employability, so negotiating these terms from the offset is key,” he says.

“Similarly, an employer may suggest unequal notice periods, where an employer is entitled to a longer period of notice from an employee, but the employee can be dismissed on minimal notice. In other cases, employees fail to ask or negotiate reasonable terms in respect of sick pay.”

It can be difficult if either party starts to make strange requests, but it’s important to be firm with those that make them, and never agree to unreasonable demands.

For any contract, clarity needs to be pinned down, especially with regards to promotions, bonuses and other incentives. “A common issue relates to bonus schemes and commission,” says Alan Lewis. “Quite often vague references/promises are made to such schemes that are ultimately not set out clearly in any contractual documentation. It is usually in an employer’s interest to make it clear that bonus schemes are wholly discretionary whereas employees would prefer the certainty of a contractual entitlement if set targets are achieved.”

If you’re dealing with an employer that is reluctant to change any terms, think about chasing a more flexible contract which can help build bridges between both parties. Lewis says, “Allowing some flexibility can help build good relations, for example, agreeing a salary review date or adding to an individual’s holiday entitlement after set periods of service can go a long way in incentivising loyalty.”

 

Levels of negotiation

Depending on where a candidate is with their career, it’s likely that a different level of negotiation will be required.

Here are three scenarios to think about:

School leaver

Although unlikely to be making too many demands, school leavers may still question pay, holiday rights and sick entitlement. If they don’t have much work experience, it’s worth explaining the different elements of a contract, and why something has been offered to them. If the terms are reasonable but the candidate is still being difficult, gently point out that contracts across the board are very similar, especially for someone of their experience.


Graduate

Again, it’s worth carefully going over the terms of a contract with someone in their first post-university job to explore whether they have something particularly special that needs addressing. It’s likely you’ll have lots of graduates all vying for the same job, but that doesn’t mean the employee can’t negotiate terms, just be careful how you pitch any demands to an employer.


Senior roles

In this case it’s more likely that the cards will be with the candidate. They’re probably used to negotiating contracts and may be used to getting what they want. If the terms are reasonable, and are similar to other positions, make sure this is explained carefully to the candidate.

However, you can also afford to be a bit more cavalier in your approach with the employer, especially if the candidate is in high demand.

 

Dos and don’ts of negotiating

 

DO read carefully

Make sure you thoroughly check the terms of a contract before discussing it with either the employee or the employer, and highlight anything which seems unusual.

 

DO know your bottom line

Before entering the negotiation period, make a list of the absolute minimum requirements that must be met (from both parties) and keep this in mind at all times.

 

DO stay positive

Even if your negotiation doesn’t work out exactly how you want it, it’s important to keep positive and work with your client on the next step, whether that’s finding another suitable job or accepting the original contract.

 

DON’T be a bully

Attempting to force the employer into changing a contract with aggressive tactics isn’t going to do you any favours, as tempting as it might be. Similarly, being bullish to a candidate about the terms of a contract you might consider reasonable is just likely to put someone’s back up.

 

DON’T be unprepared

Before discussing a contract terms with either party make sure you know what the other one wants, or expects. Make lists, if it helps.

 

DON’T embellish to get what you want

It can be tempting to exaggerate the truth to get what you want for the candidate. But it’ll only come back to bite you if (or more likely when) you get found out.

 

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