A guide to salaries, negotiating and asking for more
So you’ve landed on what seems to be the perfect role, like a shard of gold shining through what feels like a sea of job ads. And then, you notice the salary… How do you know if it’s fair, and how do you go about asking for more? Negotiating your pay is never easy, especially when you’re just starting out, yet this is when money conversations are at their most important. Here, we’ve put together some essential guiding points to help you nail those negotiations.
Why is it important to talk about this?
Your initial salaries will impact your future, which is why knowing your worth, understanding what makes a salary fair, and how to negotiate are vital skills that are best built early on.
This is particularly relevant when it comes to addressing the gender pay gap. Research from Fawcett Society has shown that 60% of women in the UK don’t know what their male colleagues earn, or believe they’re earning less for the same work. And according to research by Totaljobs, women are paid on average over £6,500 per year less than their male counterparts. It also states that women feel less comfortable negotiating a salary or asking for a raise. This, coupled with a the fact that many job listings will avoid listing salaries, is fuelling the pay gap and encouraging discrimination.
Not to mention that according to a survey from Salary.com, only 37% of people always negotiate their salaries, while 18% never do (🤯). We’re not here for it, so let’s get started.
What do we mean by salary?
Salaries are mostly applicable to anyone in full-time, part-time or fixed-term roles. Your salary is the money you get from your employer – either as a monthly or annual payment (or hourly if you work part-time) – and is usually agreed in your contract before you start a new job.
While many people will likely know what a salary is, what perhaps isn’t so obvious is how it’s broken down. For example, if the salary on your contract is £22,000 this doesn’t mean you will earn exactly £22,000 at the end of the year. This figure doesn’t take into account deductions for:
- Income tax (PAYE, or ‘Pay As You Earn’)
- National Insurance
- Student loans
You can use many salary calculators online (including this one from Randstad or this one from Totaljobs) which can help work out your exact net salary and take home pay after these deductions.
🔢 An example breakdown
A £22,000 annual salary will mean you ultimately take home around £18,622 (not excluding student loans or pension contributions from your employer), which breaks down as the following per month:
Total (or gross) wage per month: £1,833.00
minus Tax (PAYE): £157.00
minus National Insurance: £124.00
Net (or take home) pay = £1,552.00
🚨 A few salary-related warning signs
A reminder about taxes
If you work full-time, your employer sends your salary information directly to HMRC, and they work out and deduct your income tax (PAYE) for you. But if you also take on freelance work in addition to your full-time work, you’ll still need to register as self-employed, submit a tax return and pay any additional taxes. More about this can be read in our guide here.
Watch out for illegal salaries
While salaries for internships do exist, there are a few things to look out for before accepting one. Know that an intern’s rights depend on employment status – whether you’re classed as a worker, volunteer or employer.
If you’re a worker, you’re entitled to National Minimum Wage which is currently set at £9.50 per hour for those aged 23. However if you’re unpaid in this scenario, this makes the salary illegal. Head here to read more about unpaid internships, and what to do if you’re in one.
When will you need to talk about salary?
There are a few occasions where salary discussions can pop up:
- At interview stage (if an employer asks for your salary expectations)
- After you’ve been officially offered a job
- During a pay review, or when you’ve been in a full-time job for a while
Most of the time, though, these discussions tend to happen before you start a job.
How to work out if a salary is fair
There are many factors to think about when considering a job, like the sector, company size, career progression, development and training opportunities – and, of course, earning potential. So if you’ve spotted what looks like a dream role and are gearing up to apply, it pays to know if the salary they’re offering is fair. There are few ways to do this.
🏦 Work out your cost of living
Knowing what you need to get by, and having a figure that takes into consideration your needs, skills and experience will mean that you’re more prepared to work out if a role is the right one for you.
You need to know exactly how much money you need to live. So first, break down all your outgoings. This should take into account things like:
- Local travel
- Social activities
Hiring managers might ask what your desired salary is when you apply, or during the interview stage, which is why it’s useful to calculate your costs beforehand and keep this essential figure in mind before you start your job hunt.
⚖️ Compare and contrast other salaries
Next, spend some time researching what the market rates are for the type of position you’re applying for.
To start with, you could ask friends, colleagues or other contacts in similar fields what they earn. You could say something like, “I’ve been offered £X for a job. Do you think that’s a reasonable figure?” or “What do you think would be a reasonable rate for a job involving X?” More tips on this can be found here.
Check out salary comparison sites
There are also countless salary comparison resources out there to help you understand what other companies or roles are paid across disciplines, including tools on sites like LinkedIn and Glassdoor.
It’s worth noting that salaries for the same job might change depending on the sector, discipline and industry. For example salaries in the education or charity sectors will vary in comparison to those in tech.
While it’s common to raise your salary by leaving one role for another, some people will also start a new role and take a salary cut for their dream job, or because they’re passionate about the work. Others might sacrifice other things for higher pay, like company benefits.