Offer Letter

[Al Geist]

James Barrow wrote:

>>Dori Green said:
>>
>>Great advice from an old Amish horse trader -- "The first person to 
>>name a >price is the loser."
>>    
>>
>
>I think the above statement works in regards to contract jobs and working
>with a recruiter, but less for positions that involve offer letters.
>  
>

Actually, Dori's advice is one of the first rules of negotiation found 
in virtually every book on the subject.  Most employers (and recruiters) 
will jump through hoops in order not to be the first to mention a dollar 
value, because they know that most potential employees will undervalue 
themselves.

>Typically, one in five posted ads on Dice or Monster list an hourly rate or
>range (e.g., $35 or $35-$47).  I've always assumed that this is the what the
>client company is offering *after* the recruiter has subtracted his
>percentage.
>  
>

Your probably correct in this assumption.  There would be no reason to 
advertise what they are getting paid for your labor.  It will just make 
you want more when you found out how big of a chunk they take from your 
paycheck.

>Whenever I begin negotiations, recruiters often claim that the rate is
>"capped", and that no more money can be offered for that position.
>
>Whenever a recruiter tells me that no more money can be offered, I want to
>stop them in their tracks and say, "No, you don't understand.  Don't go back
>to the client company and ask them to increase the pay rate.  Instead, why
>don't you take a smaller percentage of what the client company is offering,
>and give those few extra dollars per hour to me?"
>  
>

Most recruiters have the liberty to negotiated within a certain pay 
window and based on approval of their supervisors.  They're sales reps, 
much like car sales reps.  Their take home pay could be base plus 
commission, or commission only, and both are based on the amount of 
money they bring into the company every month.  What is their incentive 
to give you more money and possible reduce their income? It all boils 
down to supply and demand.

If you are a perfect fit for the position and the client company wants 
you no matter what, you have some leverage to get a few more pennies in 
your pay envelope.  If the recruiting firm has a list of 10 potential 
employees all with similar backgrounds, you have less leverage.  If it's 
a government job, you have no leverage.

Of course, there are always those companies that are too cheap to pay 
for quality employees, and the quality of their products and employee 
turn-over reflect that approach.  Unfortunately, these are often the 
same companies that give their former CEOs $200 million severance 
packages for working two years to bungle things up even more than when 
they started...leaving even less money for the little people.


Al

-- 

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