Compensation: Negotiate beyond money

Compensation: Negotiate beyond money


I recently decided to leave a Fortune 100 company after nearly seven years. I accepted a generous severance package and have just been offered a good job at a small but growing company. I don’t think this company can match my salary demands so I would like your advice on compensation — how to negotiate professionally with them. Thanks.

Nick’s Reply

compensation negotiateJob candidates can flub negotiations if they fail to recognize that there are two components to compensation. There’s money, and there’s everything else. If you ignore that dichotomy and focus primarily on the money, you miss the point of compensation and you might forego a job you really want. Of course, if salary is the key for you, then much of this advice won’t be helpful. But if you’re open to alternatives to salary alone, read on.

What is compensation?

Compensation is not necessarily just money. An employer compensates, or “counterbalances or makes amends for” actions you have taken (that is, work you have done) for the employer’s benefit. Viewed this way, compensation might have little or nothing to do with paying you money.

You might think I’m batty, but if you’re forced to negotiate with an employer who can’t meet your salary requirements, suddenly the idea of negotiating beyond money gets interesting. Let’s consider what compensation really means.

What is compensation for?

You devote time, effort, brain power, and perhaps muscle to do a job. These resources are all limited. You deplete them from your life as you deliver them to your employer.

For example, you take time away from your family so you can do the job. Who takes care of your kids? Who grows the potatoes for your dinner? Where do you find time to build a shack to shelter your family from the cold?

If you’re going to tend the job your employer needs done, who will take care of your needs? Simple: your employer. A company must compensate, or counterbalance, for what it takes away from your life — or you will not be available to do the job you’re hired for.

What kinds of compensation are there?

An employer could provide you with housing. (Coal mines used to build entire towns to house their workers. We won’t get into how this system was often abused.) Or, it could give you food. (Restaurants often feed their workers.) In recent times, companies have provided on-site day care for children, or have allowed employees to bring pets to work. If your mortgage, meals, and child care were covered, salary might not be the only salient component of your compensation. You might instead focus on negotiating for a house rather than a shack; for education in addition to child care; and for steak rather than potatoes for your kids.

Did you negotiate for any of those things the last time you entertained a job offer? Maybe you should have, especially when the employer couldn’t cough up the cash you wanted. (See How I negotiate compensation.)

Of course, the list of potential forms of compensation is virtually endless and depends on the company and on you. The challenge is to explore the best, most reasonable alternatives together.

Compensation: Negotiate beyond money

Now, some of these examples are admittedly extreme. But when a company is strapped for cash, should you hang your head and walk away? For better compensation, negotiate beyond money. The smart job hunter knows to shift the negotiation to non-cash, non-salary forms of compensation. You can suggest acceptable alternatives and help the company identify ways to “make amends for” its inability to compensate you in cash. To do this, you must be able to express your needs in terms that can get them satisfied.

Cash futures. If a company can’t match your salary requirements, but you still want the job, don’t fight it. Instead, put other compensation options on the table.

These might include “cash futures”: company stock, an early review with a guaranteed raise, an incentive plan based on agreed-upon performance criteria, guaranteed severance upon termination, elimination of a non-compete clause, or a retention bonus payable once you’ve been on the job for one year.

Salary alternatives. Then there are indirect benefits, on which a company gets a discount (think tax write-off, too), but which deliver value to the employee: computer equipment and other technology to use at home, extended paid vacation, a transportation reimbursement, an expense allowance, child care benefits, a paid cell phone, education benefits, and tax advice services or even payment of taxes (not uncommon for executives).

Priceless time. There’s also quality-of-life compensation: flex time, sabbatical leave, unpaid time off and, nowadays, the freedom to work from home. Most people crave more control over their schedules. You won’t get paid for those summer Fridays off, but if a company can’t afford a full week’s work anyway, you still have a job to go back to on Monday.

Money is great because it’s fungible. It’s an almost universal medium of exchange. It gives us the freedom to buy what we need. But when cash is tight, there’s also freedom in knowing how to negotiate beyond money to get compensated for our work in other ways. You must be able to discuss alternatives, because creative compensation terms might yield a job where there was none.

I’d never suggest taking a job that doesn’t pay well enough, unless maybe if you’re desperate. To be a really effective negotiator, you must be prepared to walk away from any deal that’s not good enough. But before you walk away from a good job with a good employer that “can’t afford you,” try to boost the compensation — negotiate beyond money.

Have you ever foregone higher salary for something else important to you? Have you successfully negotiated beyond money? What are the top three forms of compensation for you? What’s the most unusual form of compensation you’ve received for your work?

: :

Just Say It: I want the job

Just Say It: I want the job


I had a coffee with a potential manager in his company café and we discussed my past and current experience but it wasn’t referred to as an interview. It lasted 1.5 hours. The final 30 minutes were with his manager, who dropped by.

I never applied for a job and never shared my resume. We connected on LinkedIn and arranged the coffee through LinkedIn messages. I know he has a job opening (and one more coming up) and he confirmed that in our coffee chat, but he didn’t explicitly say the chat was an interview for the job opening, so I am wondering how I can follow up without sounding like I am bluntly following up on a formal interview. I’d like to get feedback and want to know what next steps are. Should I send him my resume and ask whether he would consider me as a candidate?

Nick’s Reply

I want the jobDon’t ask whether you’re a candidate. Tell him that he’s a candidate to be your boss.

This is the best kind of interview. It sounds promising, but we just don’t know whether it’s for one of the two jobs you mentioned or for something in the future.

Give the manager a signal

While you’re worried this “non-interview” may lead nowhere, the manager may be waiting for you to tell him what’s next. Many managers look for something few candidates ever display: motivation and desire for the job.

Having the right skills and experience is important, but I find that the best managers won’t make a hire unless they see clear indications a person really wants to work for them. Motivation is at least as important as skills, which can be taught. The amount of time the manager spent with you is a strong positive signal — so signal back to him.

I want the job

Use your own best judgment, of course, but I think a simple e-mail is best, confirming your enthusiasm and motivation. For example:

How to Say It

“Thanks for the good conversation last week and for all you shared about your department (and for the coffee!). I’m impressed, and I want you to know that based on what I learned, I’d be very interested in joining your team if an appropriate position is open. You’re the kind of manager I want to work for. Thank you for spending so much time with me.”

Very few candidates ever come out and tell a manager “I want to be on your team!” yet that’s what any good manager wants to hear – a commitment! What I’m suggesting is a very clear expression of interest without being pushy. I would not send a resume. If he wants it, he’ll ask for it.

Show even more enthusiasm

If you want to go a bit further in showing your enthusiasm, find a really good article that addresses an issue that was discussed during your meeting. Attach it to your e-mail along with a couple of comments about why the manager may find it helpful. Show that you’re already thinking like an employee.

When you make yourself this clear, you need not do anything else. The next move is the manager’s. Don’t keep pestering for a response. While you wait, the best next step for you is to move on to your next opportunity and pursue it the same way.

Nice work getting a meeting that’s better than an interview! You had a conversation driven by your interests and the manager’s — not by an “HR script.” Whatever you decide, please let me know how this turns out. I hope something I’ve said is helpful.

(For more on the topic, check this article.)

Why do you think the manager invited the reader for coffee? Was this a job interview or something else? How should this reader follow up? Is “I want the job” the right message?

: :


New Recruiting: Let’s just hire ChatGPT

New Recruiting: Let’s just hire ChatGPT


First we had to learn to cough up the key words some Applicant Tracking System (ATS) wants to see when we submit a job application. Now we have to use ChatGPT to write our resumes and applications because employers are using ChatGPT to write job descriptions and postings. Where does it end? Why don’t they just hire the ChatGPT?

Nick’s Reply

recruiting-chatgpt(In this column, I will use ChatGPT as a catch-all term for all generations and competing products of the underlying technology, because this is not an analysis of the technology itself.)

An L.A. Times story tells how to write a cover letter and resume using the artificial intelligence of ChatGPT. The technology is credited by users with the skills of a professional coach or editor:

“The aspects of using AI to assist — it’s a tool,” job seeker Jesse said. “Imagine you had an expert next to you telling you how to get better… It wrote [a cover letter and resume] better than I ever could.”

Seriously? An expert?

Is ChatGPT an expert?

Human experts like Noam Chomsky describe these A.I. systems in The New York Times like this (emphasis added):

“Roughly speaking, they take huge amounts of data, search for patterns in it and become increasingly proficient at generating statistically probable outputs — such as seemingly humanlike language and thought….ChatGPT and its ilk [are] a lumbering statistical engine for pattern matching, gorging on hundreds of terabytes of data and extrapolating the most likely conversational response or most probable answer to a scientific question.”

“…machine learning systems can learn both that the earth is flat and that the earth is round. They trade merely in probabilities that change over time.

What game are we playing?

Employers and the Employment Industry at large are creating an increasingly complex game of recruitment advertising and hiring. Of course, now job seekers are learning to play the game by deploying ChatGPT against ChatGPT. (We warned you 7 years ago: Send a robo-dog to interviews.)

But how does this approach of gaming a system that is itself a game play out? Who gets hurt? Who benefits? Will Jesse get the right job? Will you?

What’s the outcome?

The proliferation of job boards and ATSes doesn’t seem to have fixed the talent shortage for employers, and it hasn’t fixed unemployment for workers. But we still use them, perhaps because we keep avoiding an outcomes analysis. Maybe it’s because automating it makes job hunting less painful, even if that doesn’t really work.

So let’s automate some more! But let’s check the outcomes, eh?

Does reliance on ChatGPT improve:

  • the quality of applicants or candidates,
  • the quality of hires,
  • the quality of a job match for the job seeker?

Or are we just getting better and quicker at pushing a square peg into a round hole before anyone realizes the damage that may be caused?

ChatGPT: Everybody can do it

Then there’s the problem of needing to use a cheat-checker to avoid getting caught cheating. Though Jesse lauded ChatGPT for cranking out good cover letters, saving him work, “there was one additional step involved: running the letter through online A.I. scanners that have popped up to detect A.I.-generated writing to make sure it passed the test in case companies checked.”

The L.A. Times story cites other job seekers who report that “tapping ChatGPT to write their cover letters was a no-brainer…. ‘A bot reads them,’ they said, referring to cover letter and resume-scanning software that many employers use to filter out candidates. ‘I’ll get a bot to write them.’”

Everybody’s doing it.

Interview the glove!

Kind of sounds like a nuclear proliferation treaty will be needed before real information about workers and jobs disappears in a mind-numbing hall of machine-learning mirrors.

Players on all sides of the Employment System have adopted a virtual process that creates avatars or surrogates to conduct the business of matching workers and jobs. Maybe another analogy is more apt: the old complaint about “washing your hands with rubber gloves on.”

Just hire the ChatGPT

Of course, what’s wrong with hiring someone who used ChatGPT to produce their cover letter, if this new employee will use ChatGPT to do their job, too?

Play this out, though: Who needs this new employee? The hiring technology could also be used to do the job.

Well, at least a lot of people other than Noam Chomsky seem to think so.

(Does anyone see what I see? ChatGPT is just the next level of keyword matching that drives sincere job seekers mad as they lard their resumes and job applications with strings of letters they know the algorithm is searching for. While the new tool is certainly more powerful — it will lard your resume for you — is it actually any different?)

What does the use of ChatGPT tell us about how the employment system works? If employers are going to hire based on auto-written cover letters and resumes, what does that tell us about how they assess job applicants? And of course, what does it tell us about job seekers who use ChatGPT?

: :

How do I decline the other job offer?

How do I decline the other job offer?


Your interviewing techniques worked too well and now I have two exciting job offers! Based on your suggestions about how to choose an employer, I have evaluated the people, the product and the companies’ reputations and I have accepted one of the offers. Your advice on how to resign properly was great, too – it went without a hitch.

Now, what is the best way to decline the other offer? I would like to avoid a lot of “why” questions, because my reasons are mostly due to the reputation of the company I want to join, and I “clicked” better with the manager who would be my boss. Thanks for your advice.

Nick’s Reply

decline job offerI’m glad to hear my suggestions helped you win a new job and resign an old one – I love to hear success stories. You’re welcome, and thanks for your very kind words. Congratulations on getting two offers! Nowadays that’s quite an accomplishment.

Your wish to avoid a discussion about “why” you’re turning down a job offer is understandable. Let’s talk about a prudent and safe way to do it.

Decline a job offer via phone

The right way to turn down one of the offers is on the phone, not via e-mail. Despite the cold, impersonal ways most HR departments behave when they reject you, you should cultivate a higher standard.

Make the call to the manager who offered the job, not to the HR department. Awkward though it might seem to you, it’s important to take responsibility for your decision and to tell the manager yourself. This is a manager who wants to hire you and who could serve as a reference for you one day when you need one, or who might hire you in the future. This is the kind of relationship you want to cultivate and protect. So make the conversation personal and as positive as you can.

Decline a job offer concisely, politely and firmly

How to Say It

“I’ve thought about the offers I received very carefully. The opportunity to work with you means a lot to me. However, after careful consideration I’ve decided that another job with a different company is more suitable to my goals at this point in my career. So, I must respectfully decline your offer. But I want to thank you very much for your faith in my abilities. I hope at some time in the future we get a chance to work together.”

That’s it. If they press you, you can decline to discuss details just as politely and respectfully.

How to Say It

“It’s a better fit for me. There’s really not anything else I can tell you. Thanks again for the offer.”

Never disclose where you’re going

The less you say, the better. What if they ask who the other company is? Never disclose that, simply because it’s not their business. It’s rare, but I’ve seen companies try to torpedo job offers from their competitors.

How to Say It

“I’d prefer not to divulge the name of the other company because I don’t think it’s appropriate to do so until I am actually working there. Once I’m settled in, I’d be glad to get in touch.”

If you’re both local, you might even suggest meeting for breakfast or coffee. I’m not kidding — handled deftly, the manager becomes a friend, a reference or even a future boss. I’d never waste an opportunity to form a new business relationship. But let some time pass — get in touch after you’ve been at your new job at least a month.

Be brief and professional

In my opinion, you are required to be polite and professional. It ends there. You are not obligated to explain “why” if you don’t want to. If they get pushy, just thank them again and gently hang up the phone.

If my suggestions sound a bit unexpected, consider what happens when a company rejects a job candidate. The rejection is usually cold and impersonal. The candidate is left hanging and upset because the company does nothing to show respect or to maintain a relationship. That’s why it’s important to rise above the impersonal so you will be remembered positively. I wish more companies would do the same!

There’s one special thing you can do if you’d really like to leave the door open for future contact. If you like the company and manager well enough, even if they’re not right for you, suggest another good candidate. That’s a professional courtesy that goes a long way with some managers.

Enjoy your new job! My compliments to you.

How do you decline a job offer when you’ve got a better one?

: :