E. Negotiating the Job Properly

No matter what your job classification is, never be afraid to negotiate a job. When key terms are not discussed before the hiring, misunderstandings and confusion often follow. The more points you insist on, the more benefits and protections you will obtain. Salary, title, duties, authority, bonuses, and job advancement are fair game for negotiation. On the other hand, fringe benefits, and profit-sharing and pension plans may be fixed and not open to negotiation. Do not expect to get everything you request. However, by understanding the terms to ask for, you can receive additional benefits and protection. The following checklist is a comprehensive guide of things to consider asking for, with fall-back strategies if your initial requests are denied.

Job Security

1.Your goal is to avoid being fired suddenly at the employer's discretion.

2.Ask for a fixed contract term, such as one-year. If you can get a one-year contract in writing, the employer cannot fire you prior to the expiration of the one-year term except for a compelling reason (i.e., cause). This is often difficult for the employer to prove.

3.If the employer refuses to hire you for a definite term, ask for a guarantee that you cannot be fired except for cause or unless you fail to achieve certain goals (for example, reach a minimum sales quota if you are being hired as a salesperson). This request can give you needed protection without locking the employer into giving you job security.

4.If this request is refused, ask to be guaranteed a written warning stating a definite period of time (for example, 30 days in which to cure alleged deficient performance) before being fired.

5.If this request is refused, ask to receive written notice (say, 30 days) before any firing can be effectuated. This is called receiving notice of termination before the effective termination date so you can plan ahead and look for other employment while still collecting a paycheck.

6.If this request is refused, request pay in lieu of notice in the event you are fired without warning; for example, ask to receive two weeks' additional pay at your current salary level in the event you are fired suddenly. This notice pay is in addition to severance pay (which is discussed next).

7.Inquire if the initial probationary period is guaranteed. For example, if you are told that you will be on probation during the first three months after your hire as an evaluation period for the company to determine if it wishes to offer you full-time employment, clarify that you cannot be fired during the first 90 days, especially if you are relocating or are resigning from a good position to accept the job.

Severance

1.Try to obtain a predetermined severance package before being hired. Does the employer have a definite stated policy regarding severance, such as one month of severance pay for every year worked?

2.Inquire whether severance is paid if you resign for a good reason as opposed to being fired. Most companies do not pay severance upon resignation or when the termination is for cause.

3.Request that notice pay (discussed above) be handled separately from severance pay.

Vacation Pay

1.How much vacation pay you get often depends on your salary grade, type of job, and how well you negotiate.

2.Be sure to understand how vacation pay is computed and other important matters regarding the granting of vacation time.

3.Ask that vacation days be carried over to the next year if they are not used, or that you will be paid for unused vacation days. Avoid allowing the company to state that vacation days are forfeited if they are not used in a given year.

4.Negotiate the amount of vacation days to increase depending on the number of years with the company (for example, three weeks of vacation pay for the first five years, increasing to four weeks of paid vacation annually from years six through ten).

5.Understand the amount of notice that is required to be given before you can take vacations.

6.Must vacation days be taken all at once, or can they be staggered? Are there times during peak seasonal demands when requests will not be granted?

7.If you leave or are terminated, what is the company's policy toward paying unused vacation time. In most states, it is illegal for employers to withhold accrued vacation days, even if you are fired for cause. Check with the Department of Labor in your state or speak to competent legal counsel where applicable.

Personal Days

1.Negotiate for a minimum number of personal days (say 10 per year) to be paid.

2.Inquire about permitted absences due to medical and dental appointments, bereavement, maternity leave, and other leaves of absence.

3.Inquire about benefits available if you must take an extended leave, such as maternity leave or leave for child care after the birth.

Salary and Overtime Pay

1.What is your base salary and when is it payable? Understand all deductions from your paycheck.

2.When does the pay week start and end?

3.If a payday falls on a holiday, when are paychecks distributed?

4.Is overtime offered? If so, at what rate? Are more senior workers offered overtime first? How much notice will be given before you are requested to work overtime? Can you refuse to work overtime for a good reason?

Bonus Pay

1.Your goal is to make a bonus part of your compensation package and not subject to the employer's whim or discretion.

2.If possible, negotiate to receive a bonus. If so, understand how it is calculated and when it is paid.

3.Request a verifiable bonus. Specify the amount, when it is to be paid, and that there are no strings or conditions attached.

4.Request a pro rata bonus in the event you resign or are fired prior to the bonus being paid. For example, if the bonus is computed on sales volume and you work a full year but resign or are fired on December 1 of that year, you should be able to receive eleven-twelfths of the expected bonus.

5.Avoid allowing the employer the right to arbitrarily determine when and if a bonus will be paid and in what amount.

6.Resist arrangements that require you to be on the job after a bonus is earned in order to receive it. If the employer insists on this condition, negotiate the right to receive a bonus if you are fired due to a business reorganization, layoff, or for any reason other than gross misconduct.

7.Get it in writing. Verbal promises to pay bonuses are not always enforceable.

8.Try to link the bonus to some verifiable formula (for example, gross profits or sales volume). In fact, if a bonus-enforceable-by-contract arrangement can be proved in court, you may have the right to inspect the employer's books and records in a lawsuit.

Fringe Benefits

1.Your goal is to properly negotiate extra compensation in the form of fringe benefits. Many forms of fringe benefits are even more valuable than salary because they are nontaxable.

2.What fringe benefits will you receive?

3.Try to negotiate use of an automobile, free parking, car insurance or allowance reimbursement, gasoline allowance, or loans at reduced rates of interest, if applicable.

4.Are you entitled to additional compensation in the form of tax-qualified plans, including defined-benefit, profit-sharing, money purchase, and pension plans? Other benefits you should also be aware of are social security benefits, Individual Retirement Accounts (IRAs), 401(k) plans, thrift plans, stock bonus plans, and employee stock ownership plans (ESOPs).

5.Understand what benefits the employer offers in the area of additional compensation and what contributions will be made on your behalf. Key questions to ask are:

• Are you required to contribute matching sums of money? If so, how much will this cost you? Can you increase or decrease matching contributions at your discretion? If so, is notice required and how much?
• Does the investment accumulate tax-free?
• Can the money be taken prior to your retirement? If so, is there a penalty?
• What happens if you resign or are fired for cause? Is the money forfeited?
• What happens if the company is sold or goes bankrupt? Is the money protected?
• Who administers the plan benefits? How can you be sure that there are no funding liabilities and the monies will be set aside as promised? Are the plan benefits prudently invested in such a manner as to preclude large losses?

Relocation Expenses

1.Always negotiate to receive relocation expenses where applicable. For example, if you are moving from Cleveland to San Diego to accept a new job, request the employer to pay for all direct and incidental expenses associated with the move. This might include losses incurred in selling your house, expenses incurred to transport your personal possessions, and travel to the job site for you and your family. Points to discuss and negotiate include questions like:

• How much relocation pay will be given?
• When is it payable and who will pay for it?
• Are taxes taken out of the payments?
• What supporting documentation is required in order to receive reimbursement?

2.Do not allow the employer to unilaterally cancel relocation expenses if the job doesn't work out because you may have moved yourself and your family thousands of miles at great expense with no protection.

3.If you are planning to relocate to a distant location, ask to receive written assurances that relocation expenses will be paid regardless of how long you work for the company.

Job Advancement

1.Are periodic raises given? If so, what is the procedure for merit raises and job advancement?

2.Understand how raises are determined. Avoid situations where the amount of the raise or promotion is determined by one person's subjective decision. If so, do you have the right to appeal a supervisor's decision? How may this be accomplished?

Job Duties

1.Understand your title.

2.What will be your job functions? Can these change?

3.Will you report to a superior? If so, who?

Other Matters

1.Are you required to protect confidential information and trade secrets acquired while working for the company? If so, understand how this will be accomplished.

2.Can you have side ventures in a noncompeting business or must you work exclusively for the company on a full-time basis?

3.Will the employer own the rights to all inventions and processes created by you during employment?

4.Are expenses reimbursable? If so, when will you receive reimbursement and what must be submitted to get paid?

5.What are the procedures for withdrawing money from retirement accounts?

6.How much advance notice is required to be given in the event you wish to resign?

7.What are the company's short-term and long-term disability policies?

8.How long must you work before qualifying for health and other covered benefits?

9.What is the company's policy toward maternity leave and unpaid leaves of absence? If you become pregnant, will the job be held open if you wish to return within a reasonable time after giving birth? How much time?

10.Will you receive a contract confirming the points discussed and agreed upon?

To perform your job better and reduce misunderstandings, ask to receive information regarding the following policies:

• Time clock regulations
• Rest periods
• Absences
• Safety and accident prevention
• Authorized use of telephones
• Reporting complaints
• Making suggestions
• Resolving disputes
• Personal appearance rules
• Conflict of interest and code of ethics rules

Counsel Comments:The foregoing list is not all-inclusive. Rather, it describes many of the major points to be considered and negotiated prior to accepting any job, regardless of your work status, occupation, or industry.