Money talks

How to address the compensation discussion with prospective employers.

By Jeff Hinds, MHA & Justin Mongler | Financial Fitness | Summer 2019

 

“Do you have any salary expectations or requirements that we should know about?”

Conversations about compensation expectations or requirements are some of the most difficult (albeit some of the most important) topics to be discussed with a potential employer—and you can bet they’ll come up during the interview process.

As the interviewee hoping to secure the coveted job offer, it’s crucial that you fully understand the dynamics surrounding this question and the potential ramifications that exist regarding how and when the discussion occurs.

When to talk money

The general rule is to let the potential employer initiate the compensation discussion. A candidate initiating this conversation too early may run the risk of coming across as being too aggressive or motivated only by money—traits that could deter the employer from seriously considering you.

Though it does vary by employer, it is not uncommon for some variation of the compensation question to arise as early as the initial phone interview. While the specific numbers are not likely to be discussed or disclosed that early in the process, the question is typically used as a screening mechanism to filter out any candidates up front that may not be a viable option.

Candidates expressing unrealistic expectations can be eliminated earlier in the process before the employer has to spend additional time and resources to bring that candidate onsite. Regardless of how early the question arises, you should be prepared to respond accordingly.

How to best answer

To determine your best response, you must consider both the employer’s motive for asking this question, and how your answer may affect the eventual offer.

Any number you throw out has the potential to be too high or too low. If you disclose a number that is too high, they may immediately dismiss you from consideration if they have other candidates of equal caliber with lower expectations. Conversely, if you disclose a number that is too low, you could significantly decrease your potential offer if they were initially prepared to offer more than what you disclosed.

As such, your primary goal is to attempt to get the employer to disclose their number (or range) first. This can be accomplished in many cases by simply turning the question back around to the employer. The response could be as simple as: “This is my first position out of training, and I’m not entirely sure what I should be expecting or what is appropriate in your area. What should I be expecting?” Or: “Compensation is not my top priority; I do not have a specific number in mind, as I am more concerned with finding the best fit.” Some variation of that approach can help you avoid the risks associated with disclosing a number too early and allow you the opportunity to move forward in the process while also buying time to research or discover your actual worth prior to an offer being extended.

How to determine what’s an appropriate offer

There are a number of ways to research and uncover relevant compensation data to determine market value for your specific specialty. Possessing this data is invaluable after you have received the offer and proceed with the final compensation discussion and contract negotiation.

Employers will be much more receptive to compensation negotiations when you have the data to support your request versus throwing out random numbers. Employers will typically have a range within which they have budgeted for this position. Possessing the market data could help you maximize your position within this range. Employers commonly use compensation surveys from the Medical Group Management Association (MGMA), the American Medical Group Association (AMGA) and Sullivan Cotter, among others, to determine market value for their providers. These are great resources for you to use, too, as part of your market evaluation.

In addition, there is great benefit to going on multiple interviews and collecting multiple offers. Not only are you then able to make the most informed decision, but you’ll also have multiple options to use as part of your negotiations.

In short, your leverage and ability to negotiate compensation on the back end is greatly influenced by the market data you possess. However, this data/leverage may become insignificant if you fail to approach compensation discussions appropriately from the onset of your search.

Jeff Hinds, MHA is president and Justin Mongler is vice president of Premier Physician Agency, LLC, a national consulting firm specializing in personalized physician job search and contract assistance.

 

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