Salary Negotiations: Getting to Yes!

1.       Do your Homework.   Law salaries vary widely.  You must know as much as you can about starting salaries at the specific employer and at similar workplaces.  If it is a firm, you will want to know about salaries in firms of similar size, geographic location, and practice areas, and with similar billable hour requirements.  The more specifically comparable you can get, the better, as each of those factors can have a huge impact on salaries. Thanks to those who complete surveys, PDO has some information on full-time starting salaries.  Other information on salaries and trends nationwide, and in certain sectors, can be found by researching job postings and going to various website, including:

2.       Having done your homework, have both a Goal and a Bottom Line in Mind.   As you interview for any given position, you need to formulate both what your (reasonable) dream salary would be, as well as the lowest salary you could and would accept are.  Your homework (see #1, above) will guide you as to what the general market might pay, but only you know whether you must demand more –because you have certain value or financial needs—or would work for less, given the economic conditions.  As you reach these formulations, think of factors that might add flexibility to either end of the spectrum.  For example, if an employer’s bottom line were too low, could you propose working fewer hours or taking more ownership of any clients you bring to the firm?  Could you propose working additional hours for additional pay?  Could you earn less or more if you had or sacrificed certain perks (see #3, below)? Do you have a ready-justification as to why you would be entitled to more than the standard salary, whether due to special skills or ability to bring in clients?  Be prepared to have backed up your numbers.    

3.       Benefits:  another consideration.  There are issues other than straight salary which may play into your salary calculations.  When the time arises to discuss salary, it may be wise to know whether your employer pays for any of the below-listed perks or calculates billable hours in a beneficial way.  If they do, this may help you to feel comfortable with a little less in terms of salary.  If they don’t, you may be able to use that fact to justify a higher salary.  (It may surprise you as to which employers do and don’t pay for these things—don’t assume, for example, that going to a large firm means that your family’s health insurance is paid for).  Perks/other factors may include:

  • Health Insurance
  • Life/Disability Insurance
  • 401(k)-matching contributions and profit sharing
  • Who pays for Continuing Legal Education/conferences, how many per year?
  • Phone/blackberry/laptop
  • Business development/client credit/ownership of clients
  • What counts for billable hours?  What about business development, community involvement, pro bono work?

4.       Especially with Smaller Firms, Be Aware of Various Possible Compensation Arrangements.   

  • Straight salary (perhaps plus some sort of performance bonus).   
  • Straight Contract Work/ Hourly Pay Rate.  Hourly rates vary, typically for better, consistent work it is $35-$60+ per hour.  
  • Lower base salary plus straight cut of per-hour billed out.   An employer may choose to pay a new associate a base salary which one might be able to live on, plus a certain hourly rate for each hour billed, so that if the associate billed the target number of hours, the salary would be reasonable. 
  • Lower base salary plus a percentage of collections (the actually money recovered from clients).  

5.       When and How to discuss Salary.   In general, make every effort to put off salary discussions until you have an offer in hand.   There are a few common exceptions to this, however, such as when salaries are “set in stone” or posted in the job description—ie, government jobs; or the employer has demanded your salary expectations in an application packet.  In the latter case, be prepared by having done your homework and prepared a reasonable salary range based on your research and needs.   If the topic arises during the interview process, be comfortable and mature in discussing it.  Stay calm, professional, and don’t ramble.  If you have done your research, you will at least be able to “back up” your end of the conversation.  If, during the interview process but prior to an offer, an employer asks what you expect to earn, you may choose to get clarity on whether they are making you an offer before you discuss details.

6.  Accepting or Rejecting.   If the offer sounds good to you, politely ask for a short period of time to consider it, discuss it with family and/or PDO, then go ahead and accept!  Propose that the offer be reduced to writing.  If the offer is too low/ not what you expected, your need to gage the employer’s will to stay at the lower salary.  If you think there is room to move, attempt to bridge the gap (based on your research) with a reasonable proposal.  This can be most effective if you have been working (clerking) with the employer, and they know your worth.  If they don’t know your work, you might propose a higher salary together with a performance/billable hour review in a few months so that you can show the employer you have been worth every penny.