Lots of folks work on contract, not on salary. It’s easy to net out less money when expenses go up and your client isn’t sensitive to it. Should you get paid a higher rate when that happens?

I work as a contractor for a company and I have a pretty good setup. However, my expenses have grown and I feel it’s time to ask for an increase in my contract rate.

I spoke to my immediate supervisor who said, “You will have to talk to my manager. If you were to say that you have another offer, the company would be likely to increase your rate to keep you. The manager would have something to go on to get approval from his boss.”

Now, I didn’t really care for this because I’m not going to lie. I do not have another offer, and enjoy working for this company.

I spoke to my husband and told him I wasn’t too enthused to go my boss’s boss and lie to get a higher rate. He said that I should just tell the truth and be myself. I smiled, because that isn’t the problem. Schmoozing someone who I may lose respect for — that is the problem.

What would you do?

I agree with you. Do it honestly. But that means being ready to show the boss’s boss a brief analysis and business plan. Showing how your expenses have grown is good… but what’s really good is showing how you contribute to the bottom line and how you will help with the company’s success. In other words, show a benefit to the company for the extra pay. It’s a healthy thing to sit down and work this out now and then. You might be able to figure out new ways to be a better worker who contributes more to the business. That’s what work is all about.

If you can’t figure out how to increase your value to the company in exchange for the higher rate, get your boss to help you out — or the boss’s boss. Try this: “I don’t expect you to pay more unless I can do my job in a way that adds more value to the business. Can we talk about the company’s objectives? It would help me to understand where the opportunities are to boost profitability. I might be able to offer ideas on how my job could return more on the investment.”

You get the idea. Nonetheless, the expenses argument might work by itself because it is valid… Use your judgment… but don’t stop thinking about were you fit in the profitability equation.


  1. Asking for a raise because you have a better offer somewhere else very often gets this reponse: “Good luck at the new job!” so don’t ever use that line unless you are prepared to leave and accept the better offer.

  2. I know this is universally understood by the headhunter industry, but I think it needs to be said in this instance.

    If your employer agrees to increase your salary because you claim to have a better offer elsewhere, he will also likely start looking for your replacement to ensure that he will not be left without coverage on the position.

    Something to consider in the process…

  3. I would never tell them that you have a better offer (even if you do). Even if you do have a better offer, and they match it and you accept it, they will never really trust you again–in fact, they could make your upgraded job miserable and will probably start looking for a replacement.
    I agree with Nick—show them how you have helped them with their bottom line. And if you decided to leave, just go and smile on the way out the door. No one cares more about your career than you.