To say finding the ideal person to hire is a complex undertaking is to seriously understate the case. You interview—often repeatedly. You run back ground checks. You assess the prospect's fit with the company. Once you find the right candidate, you certainly don't want to lose him or her by bungling the negotiation.
Though it's hard to wean business owners away from the idea that in the end, it's all about the money, presenting an irresistible offer is much more than just baiting the hook with an enticing salary. There are many components to the job offer. And because the importance of each element varies from candidate to candidate, you'll need to be prepared to address each one. (Even if you're using a professional recruiter to present your offer and facilitate the negotiation, you'll still need to provide the recruiter with guidance.) Here are the main points to consider:
1. Salary. As we've noted, this may or may not be a candidate's primary interest. Salary will likely rank high with twenty-something candidates; more mature candidates may have other priorities (see below). In any event, know before you go into the negotiations exactly how much money you can offer. Determine the going rate in the industry and in your geographical area for the position. If you lowball the salary offer, you risk losing your prospect right off. Protecting your balance sheet is admirable, but underpaying good people is a risky way to do that.
2. Paid days off. Be prepared to field questions about this. Your employee manual should spell out your company's policy clearly … five sick days, three personal days, whatever. Many companies are going to a system of offering generic paid days off (GPDO), rather than specifying how many are sick days and how many are vacation days. They've found that workers are less likely to call in an absence at the last minute in order to use up their sick days,creating a staffing crunch for managers. Using the GPDO system also demonstrates that the company understands that staff members occasionally need a day to, say, take an elderly parent to the doctor or simply preserve their mental health by heading to the beach.
3. Health insurance. Be prepared to answer basic questions regarding your company's health insurance benefits. Are there restrictions on the providers the employee can use? Does the company pay the entire premium or only part of it? Are dependents paid for or does the employee have to pay their premiums? It's important to answer these questions thoroughly and accuratel —not brush them off with an assurance that the HR department will answer all those questions on their first day. If you don't have answers, candidates might think you're dodging their questions because you're afraid they won't like what they hear.
4. Job responsibilities. Providing an itemized list of job tasks and responsibilities is very important to a candidate who's in this for the satisfaction of a job well done (which is definitely a character trait you want to see in an employee!). But don't stop there: Offer to do what you can to reshape the scope of the position, if necessary, depending upon the candidate's strengths and desire for opportunities for advancement.
5. Advancement opportunities. A commitment to review and adjust salary levels in 90 days or six months gives both parties a chance to check each other out. Emphasizing the potential for promotions and merit raises or bonuses may clinch the deal with someone interested in establishing a relationship with the company and who has an eye on the future. In fact, the prospect's interest in advancement opportunities could provide a very important clue to the type of employee he or she will turn out to be. Workers who are only interested in initial salary levels and not future opportunities could simply be out looking for the highest bidder. As soon as another company offers them more money, they'll quit.
6. Other perks. Other incentives that can help sway a candidate to accept your offer include life insurance, disability insurance, employee stock option programs (ESOPs), and 401K and other retirement plans that feature matching contributions from the company. Older candidates will be more likely to appreciate the true value of these benefits; younger candidates typically would rather have the dollar equivalent added to their checks.
One note of caution: Remember that nothing is a secret. You may think that your negotiations to get this hot go-getter onto your team will remain confidential. Somehow, the details always leak out. Make too many concessions, and morale and attitude through out your department can be affected, creating more headaches for you than the hotshot is worth. You could also find yourself facing an EEOC complaint for not treating everyone equally.
Presenting the job offer is the culmination of a great deal of work to find the ideal candidate. You should feel good about getting to this point. You'll feel even better if you're able to put together an offer that the candidate accepts. Now, don't forget about the training. We'll talk about that next month.