Salary Negotiation: Earn What You Deserve with Kate Dixon

Did you know, if you never negotiate your pay, you could leave almost $1M on the table over your career. Yeah, that's an 'M' -  as in million.

So, we called up our friend, Kate Dixon - one of the leading experts in all things compensation. Kate is the author of "Pay Up" and "Name Your Price". She's also the founder of Dixon Consulting - a compensation and leadership coaching firm.  

What we love about Kate (there are a lot of things to love about Kate, including her dog, Jeffrey), is that she consults with companies from Nike to Intel to Silicon Valley Start-Ups to architect their compensation strategies.  And, she also coaches executives and employees on how to get the best compensation package possible.  

She know's how this stuff works. From all angles. 

And, during our chat, she laid out what we all need to know to earn what we deserve. Here's what we covered: 

• 'Comp 101' - How Compensation Works:  A simple explanation of how the hell companies determine who gets paid what  (like pay bands, scales and functions)  
• Determine Your Market Rate: The best ways to determine your 'market rate' 
• Get in the Right Mindset: Mindset shifts necessary to advocate for yourself  
• How to Have the 'Ask' Conversation - 4-Part Recipe: A fool-proof 4-part way to negotiate your salary (for internal or external roles)
• The Future of Compensation: What's going to happen with pay? What should happen.
• Hype Songs: Yes, you should have one 

Listen, you'll leave this epidote with actionable advice on how to navigate offer negotiations so you earn what you deserve. 

Grab a notebook, you'll want to take notes. 

Disclaimer: This podcast is for informational purposes only and should not be considered professional advice. We are not responsible for any losses, damages, or liabilities that may arise from the use of this podcast. The views expressed in this podcast may not be those of the host or the management.

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Transcript

Kate : 0:00

Fundamentally, the way that I look at it both pricing conversations with clients and salary negotiation is you're solving a business problem. That's what you're doing.

mel: 0:27

We are your work friends, two HR friends who have no filter and are getting you through all the work shit. I'm Mel.

Francesca : 0:35

Hey, and I'm Francesca.

mel: 0:37

Today we met with Kate Dixon. Francesca who's Kate Dixon?

Francesca : 0:42

She's the principal and founder of Dixon Consulting, a leadership development and total rewards consultancy. She's also the author of two books that honestly, everybody should read. One is called Pay Up Unlocking Insider Secrets of Salary Negotiations. This is the book that a lot of people use to figure out how do you negotiate your salary. The other, if you freelance or you're a contractor, name your price. We got to talk to her today about how do you go through earning what you deserve.

mel: 1:10

Yeah, salary negotiations Hot topic. Good for everyone to know here's Kate. Hey, Kate Nice to see you. Hello girl. Good to see you too. We're so excited to talk about Comp with you today. I'm just going to jump right into it. Why does it matter that people know and negotiate their market rate?

Kate : 1:43

Oh my gosh, there's so many reasons. One of the things that people don't realize is that if you don't do a good job of it at the beginning of your career, it can impact you over your lifetime. Studies shows that over the lifetime of a woman's career, she can lose up to a million bucks. If you have that million bucks at your retirement, it's going to be a different retirement than if you don't have a million.

Francesca : 2:08

I have a huge, such a big interest.

mel: 2:10

Huge, yeah. What assumptions are holding people back here in this space? What do you think holds people back?

Kate : 2:17

I think the biggest one is the assumption that I don't know enough to do it right. I don't want to make an idiot of myself, and so I'm not going to do it. I think that was probably the number one thing. I think that there's also this weird thing that people think about, that they're going to have their offer withdrawn if they negotiate, which is not true. But yeah, two big things.

mel: 2:43

I believe it because I remember working in talent acquisition I could tell the hesitation to have the conversation and I think good recruiters will push you through that and then you'll have some who don't. They're like okay, that's what you accepted, though that's a great call out. We have this saying explained to me like I'm fine how the hell does comp work here? How does comp work? Walk people through? How does it even work?

Kate : 3:07

Comp went a lot right. So, basically, what happens in most companies is they create a job architecture. This is a leveling kind of a thing where you might have a professional, a senior professional, you might have a manager, a senior manager, director, those kinds of things. That's what we call a job architecture, and a lot of times when we're putting together job architectures, we're also putting together functions and families, and some companies pay differently based on the function and family, some don't. I'm really trying to encourage my clients to have a few differentiators based on function as possible, because we know that function is one of those artifacts of how we always have done things.

Kate : 4:00

There's a reason why finance and HR don't pay the same. It's because finance people used to all be dudes and HR people used to be all chip, and so what you're seeing in those functional differences is really the impact of gender bias in pay. So, anyway, I don't think that it's really worth carving out a lot of functional differences, although I have a client in high tech that's based in the Silicon Valley. They do software stuff, and so they have a specific structure for software engineers and then one for everybody else. So the job architecture has the different levels. It has different functions and families. And then what a comp person would do would be to look at a salary survey and this is a place where companies submit data about how they pay different jobs and then the company that's running the survey basically spits out a report that says, hey, this is about how much an accountant with zero to three years of experience makes in these different zip codes or these different areas, in these different types of organizations and that sort of thing. So what a comp person would do is say, oh okay, we have an accountant one and so we're going to match to this job in the salary survey and bring in all the data.

Kate : 5:30

They'll put together salary ranges either by job or by family and function or by level a number of different ways to do it but they'll come up with those salary ranges.

Kate : 5:42

Then they'll put on top of that some policies around. Here's how we want to pay people within a range. Typically they'll say entry to the bottom third of the range, for example, would be for folks who are new to this level with not a lot of experience doing this particular job. People around the middle would be seasoned folks who've been doing this kind of work for a while and have good, satisfactory performance. And then the top third of the range is typically folks who've been either at the same job for a while or have spectacular performance over time, and typically it's some sort of combination of the two. Sometimes you'll see people at the top of the range who have really unique skills that they're bringing into the organization with the assumption that they'll train other folks. Ai has been likely in recent years right, but it's typically at a new skill, super hot skill, and over time the premium that gets paying for that new hot skill regresses a little bit as more and more people get that skill.

mel: 6:51

It's helpful to educate people on how is this stuff even determined. It's not a dartboard just to throw at certain ranges. There's a lot of research and thought that goes into it. The overall package of compensation is beyond just the salary. What else is typically included in a comp package that you can negotiate?

Kate : 7:10

It really depends on the level of the job. To be honest with you, most jobs and most companies have base pay and some sort of an annual bonus. Again, in the frontline roles you don't always see a bonus. Sometimes you'll see some sort of activity, commissioning kind of thing. That will happen, but there's usually a base and a bonus kind of thing. There's always going to be some sort of benefits health insurance, life insurance, dental. You might get a gym membership.

Kate : 7:45

As you go up in the organization, you tend to see other kinds of things like equity.

Kate : 7:51

When we say equity pay, equity is one thing, but equity we're talking about compensation can mean stock options or restricted share rights or things like that. In my startup clients a lot of times we'll talk about it as a percentage of ownership of the company and then, as you get even higher into the organization, we see things like long-term cash programs and things like that. So those are the main building blocks With negotiation. Typically we'll see some sort of sign on cash and we'll set sign on equity, depending on the type of organization. Again, high-tech organizations tend to have more of this sign on equity, especially for tech people, and if it's a company that's owned by a parent that's outside of the US sign on stuff is not very common. It's not very common to do sign on cash or sign on equity outside of the United States. Just know it's not kind of part of their lexicon typically. So I do have a company that is a client that is owned by a Japan parent and they are pretty disciplined about offering sign on cash and sign on options.

mel: 9:09

It's good to know, if you're American and you expect that a sign on bonus would be something you're offered, and if they're not a US company and you're trying to negotiate, that it might be the wrong thing to negotiate, because that might it might be a little harder.

Francesca : 9:23

I've always wondered this and I would love to ask you, because you've seen it all Do you make more money over time going into a private company or a public one that gives you the RSUs or gives you the stock options? What have you found?

Kate : 9:36

I've developed my philosophy of over time on this, but one thing that I will tell you is that a good, strong company that has a history of gross equity that you get from that is probably going to be worth more in the long run than stuff that you get from a startup and people like, no, they told me I'm going to make $1 million. But what is true now that was not true even 15 years ago is that most startups wind up getting investment from PE firms and the PE firm. Their entire mission is to harvest value out of these companies that they invest in. That's what they're there for, that's what they're doing, and so, as a part of that harvesting, what I typically see is that the equity arrangements get changed pretty dramatically, especially for people who are not the founders.

Kate : 10:36

I've had clients who said, hey, I need you to help me negotiate my pay because we sold our startup to mega big fang company and I was told I was going to make millions out of this. And I actually made 20 grand and I worked 80 hour weeks for years to make this happen and we didn't get much of anything out of it, and that's because of the impact of PE firms. There's all kinds of different things that happen. But again, it's not saying don't work for startup, because one of the things that startups do better than any other company is provide boots on the ground development opportunities to learn a ton and get the opportunity to do a lot of stuff.

Kate : 11:21

Most startups that I have worked with, consulted with, they're all like oh, you're going to raise your hand? Great, have that. You want to write our report to our community? Yes, you go do that, and so the opportunity to really build a skill set unmatched, and so that's why you want to do it. Maybe it's to have a big title or have the whole CFO kind of experience. Could you do that at a big company with just a little bit of experience now, but you might be able to do it at a startup.

Francesca : 12:09

How does someone know what their market rate is?

Kate : 12:12

Yeah, there are a number of ways to look at it, and this is not about your worth as a human being. The work that you do for companies is worth Right Again, salarycom, indeedcom, glass door ladders, I mean there's all kinds of different ways your professional organizations that you belong to, alumni associations, all of these places are great places to collect data on pay, and one of the most effective ways to do it is to ask people, and there's a lot of of serving of little ditam池amerses.

Kate : 12:50

And it's hard to excuse making difficult money for them, because you may only use five different ways that you could do it, and one of the ways to find them is that's a new market to lucre fueron steer them to ask for more pay, which is hey, my research shows that jobs like this are getting paid between X and Y in the marketplace. How does that land with you? It's something that you could ask somebody who's doing the job that you're interested in today, and then they could go well, that's really high, or well, that's low, or maybe I should need to ask for a reason. But at least that can give you some of the guardrails around what's normal for what you're looking at.

Francesca : 13:37

Yeah, does it differ if someone's freelancing Freelancing?

Kate : 13:43

pay can be all over the place. Again, professional organizations can be really great. So, if you're a coach, icf does a survey every year and stuff like that. But, yes, do try to gather data because there are data sources out there. But it's really about the value that you're able to sell into the client, not necessarily XYZ dollars per hour, although some people do price stuff that way. I see some people getting big bucks in the consulting, freelance coaching space when they don't have a ton of experience, but there's a pretty good correlation. So if you've got a 20-plus year career in corporate America and now you're going to go out and be a consultant, you're probably going to get paid a lot more than somebody with the newly minted MBA. It's going to be different than somebody with an MBA plus. Yeah, that's super fair.

Francesca : 14:40

Kate, you've written several books Pay Up, name your Price, which I love too, because it also focuses on folks that are contracting in freelance. One of the things you talk about in both of those books and in your consultancy is this idea of mindset. Yeah, and I think about this conversation, especially today, as an international women's day. Today, this is when we're talking happy Friday, happy international women's day, and we're sitting in the year 2024. We're all sitting in the country of the United States and women, especially, are making 16% less on the dollar than men, and we also know pay discrepancies happen across every gender, race, ethnicity, you name it and everybody at some point needs to negotiate their salary. And I'm curious about mindset. When you're going into these conversations Wondering if you can talk about what do you coach people on in terms of getting into the right mindset as you're thinking about earning what you deserve?

Kate : 15:36

Yeah, I think it's really critical and a lot of people go, oh, I don't need that, that's woe was stopped.

Kate : 15:42

But fundamentally, the way that I look at it both pricing conversations with clients and salary negotiations is you're solving a business problem.

Kate : 15:54

That's what you're doing, and especially when you're talking about pay for yourself, it's so hard to get that emotional distance that is important when you're doing any kind of work at work. So creating that emotional distance is really important, and one of the ways that I coach people on doing that is to meditate for even 10 minutes before you get on a conversation with the person you're negotiating with and clear your mind as well as you can, and then, when you come out of that, really be intentional about how you want to show up. What do you want people to notice about you? And chances are pretty good it's going to be like hey, I'm a really valuable person, I bring valuable skills, I'm on it, I'm on my game, I'm cool, I'm great. Those are things that you want people to notice about you and if you can clear your mind of some of the assumptions about yourself and maybe the other person you're negotiating with before you get on that call, you're going to do a lot better.

Francesca : 17:00

Yeah, the energy you show up with will be different and more attractive. Quite honestly, yeah, yeah, I got it. One of the things I think about, too, is that you have the right to ask for something. Yes, and I've talked to so many people where I can't ask for that. What if they pull off the table? What if they say no? What if? Do you find that people are afraid to even broach the possibility that they deserve more, or that they deserve what they're looking for?

Kate : 17:28

Yeah, and there's some people who just think to themselves the person I'm talking with knows more about what I'm worth than I know. What I'm worth and what the person that you'll negotiate with does have more knowledge of is what's going on inside the company. And fair right, they should. But you may have a different take on what your value is in the marketplace. This idea of are we worth it? I don't know and I don't feel like I can ask.

Kate : 18:01

This is really deep-seated socialization. That's happened particularly with women, particularly with people of color, around money stuff. You should be grateful just to have an offer. No, that's not the full story. Yeah, I should be grateful for my offer. They're making you an offer because they see that you have value, and one of the things that I coach my clients on, too, is that sometimes the client company places a different value on the work that's being done than you do, and so in that kind of a case it may not be a match. When you think about a marketing person, where are they going to be most highly valued? I'm going to just tell you, I worked at Nike. It's going to be a place like Nike, they're grown for it.

Kate : 18:51

And if you're a marketing person, you're going to be like Nike. And if you're a tech person, you're going to want to go to Intel, and I've worked for both of these companies and I can tell you that a tech person in Intel is likely going to be more highly valued because the work is more highly valued and more tied to their line function, their intellectual property, than it is in a company like Nike. Again, if you're a marketing person and you're talking to Intel and Intel has great marketing people, don't get me wrong but if you're really thinking about premium package, because you're a premium talent, working for a high-tech company may not be the right match for you.

Francesca : 19:38

It's good to know to not get discouraged. If you go in and someone says we're going to pay you half of what you can get on the market somewhere else, it doesn't mean you're not valuable, it just means that they're not willing to pay that rate. Understanding your market rate in different markets is really important, yeah.

Kate : 19:56

I've had clients. People ask me this all the time. Oh, I saw the range posted. What I want is more than what's posted Generally. They're not going to go above the range, but if you really feel like, wow, this is a great match, and perhaps the potential employer may not be as connected to the marketplace as you are, it's okay to go in and say, hey, I really feel like this is a great match for me and I don't want money to get in the way of a good thing. You should know that my research is showing that jobs like this are paid like this in the marketplace.

Kate : 20:34

I had a client about a year ago who was faced with that and she was like hey, I'm in a good place. They approached me and I don't want to go to work for them for less than a good increase from the thing that I'm doing now. So she actually negotiated a 10% higher than the top of the range. Oh, wow, but I think, too, they hadn't really leveled the job appropriately and she was able to show hey, these are the technical things that you're asking for, and so this is how it should be paid in the marketplace. Is that a common thing to do? No, but it certainly does help. It's worth it.

mel: 21:17

Worth it to have a conversation. We always say that just have the conversation you never, know, you never know. I'd love to talk about the dos and don'ts of having this conversation In your practice. You talk about the four-part recipe on how to have this conversation. What is that? What is the four-part recipe?

Kate : 21:37

So the four-part recipe is pretty similar between internal conversations with your boss and external. The first part is about expressing delight. So thank you so much for taking the time to meet with me. I'm so glad that XYZ Company thinks it's as good of a match as I do. Right Done, express delight because your recruiter doesn't always know if you're going to say yes, you want to set it up? Hey, we got some breadcrumbs out there.

Kate : 22:09

So that's part one. Part two is asking questions, and this is not where you're going to ask for. What you want more of this is you're trying to clarify the offer letter and, psm, by the way, read every damn thing that comes with your offer letter Everything, yes, yes. All the attachments, the policies.

mel: 22:31

Get out of highlighter. Print that baby out.

Kate : 22:34

Write all over it Because you don't want to waste your time or their time asking stuff that you already actually have the answers to and remember you want them to think good things about you. One of the classic questions that my clients ask is something around 401k match, because a lot of times they'll say we have a very generous 401k match but they don't say what it is in writing stuff and say, hey, I see that you got a 401k match. Could you help me understand what that looks like? And then what the recruiter talk? Let your HR person or the hiring manager, whatever talk about that. And again, there are psychological reasons that we have this recipe in this order. But one of those things is these should be answerable questions that the person that you're talking to should be able to answer off the top of their head or answer with a very quick look up, so that you're making progress toward this conversation. And the number three thing is making your request. Now, a lot of people think negotiation is you start with number three, but do not start with number three. Right, it's a business problem. You're solving the business problem. You want everybody on board, so follow the recipe and make your request, like if somebody wants to ask for more base pay. This is how I ask them to do it. So my research shows that jobs like these are paid between X and Y in the marketplace. Remember that from our previous thing about asking your friends, based on my fill in the blank, some special thing about you. I'm targeting the higher end of the range. How close can we get? And this is important, this whole thing. So my research shows, yes, they want you to have done some research, right, and we want to be basing it based on your research, not on, hey, it might historically been paid lower than the market and so I would like to get paid lower than the market again. No, we want to base it on the research. So my research shows the jobs like this are paid X between X and Y. You want to give them a range of places to be successful right, but you don't want this to be if I can't have a pony for Christmas, I don't want anything. You want them to be able to be successful in different ways and the range should probably be about 10% wide. Maybe it's 55 to 65 or 55 to 62. You could say mid 200s if you want to, but X and Y in the marketplace, based on my special thing about myself, right, based on my directly applicable experience, based on my if you're doing an internal, based on my outstanding track record, if you're just coming out of school, based on the fact that I went to Northwestern, based on my special thing, we're targeting the higher end of that range. Right, okay, we say mid 200s. Well, that's 230 to 270. So I would like to be up at the top and remember, if you're saying mid 200s, 230 to 270 is in your head, you want to make sure that 230 is not your basement. Right, you'd be happy with 230. Based on this, I'm targeting the higher end of that.

Kate : 25:51

This last piece is really important. How close can we get? Now, again, this is a collaborative way, it's not. Can you do this, right? And you're asking how close can we get? Because you don't want to guess, or no question, because that fires off really quickly in the brain. You want them to stop and listen to it. Close can we get? And then the most important piece of this question is what you do when you're done, and that is you be quiet.

mel: 26:19

Faved you. Yeah, you're like sure.

Kate : 26:21

no, it's for a while they're thinking right, and you've asked them something that they have to think about and it's a multiple part question, and so you want them to have time to process this and chance are very good that they're not going to be able to give you exactly what you want in that conversation. It's not your goal to have them say, yes, you can have $270,000, right, right. Your goal that we offer them, but it's not reasonable. They always have to go back, just like car salesmen. They always have to go back to the manager and have that expectation. So you're making a request to maybe three tops I wouldn't make more than that and rank them in the order of their importance. And that's not just like well, gym membership Okay, good for you, but if you get an extra $5,000, you can pay for that, you can count it. So rank it in terms of like, volume and importance.

Kate : 27:21

So then, once you've made your request, then the fourth piece is ending on an up note, and there are a couple of different pieces of this right, and one of them is we know that the end of conversations is more important than the beginning in the middle. It's stupid, it's true. If you look at Yelp reviews, they're all about like took them 15 minutes to get my bill to me and then I got mad. So one star. Yes, I know making the request it's very hard, it's very emotional, but you're focused on having a good ending this conversation. Thank you so much for advocating on my behalf, did they think?

Kate : 28:00

they were going to advocate on your behalf. Maybe not, but thanking them for doing it.

mel: 28:05

It's always a good thing. A little bit of thanks goes a long way.

Kate : 28:08

You both know this. We're not getting any love.

mel: 28:12

No, they're in the middle getting beat up on both sides.

Kate : 28:15

We need help If you're recognizing what they're doing for you and appreciating that it goes a long way. Yeah, it goes a long way.

Kate : 28:22

Yeah, thank you so much for advocating on my behalf. Then you have to figure out when you're going to talk to them again, because people think that doing this negotiation is the hardest part of negotiation. No, it is waiting to hear back from the recruiter. That is the worst. People make up stories and they're head about how it works. You can take the lead on this. When would be good for us to talk again? The insolver recruiters are going to be great and they're going to say, oh yeah, let's talk again on Thursday. But if they don't say that, when would be a good time for us to talk Sounds like you've got some background stuff that needs to happen.

Kate : 29:05

I want to make sure that you have enough time to do that. What about next Wednesday? Does that sound like a good time for us to connect? Sure, I guess we could. I've got nine o'clock free. Can I send you an invite? Take some work off of your recruiters plate, because, guess what, they have 30 to 40 requisitions. You're not the only person that they're talking to, so make it easy for them and then you're done. Right, you've expressed your delight, you've asked your questions, you've made your quest and then you've ended. On an up note it's a recipe for success.

mel: 29:43

Having a collaborative conversation and you're providing options, just like they've provided you with options, and it shows that you're willing to compromise. And it's a two-way street, go the long way and it's and you're poor recruiters. They're really trying. They do want the best for you and Kate to your good point. They're usually handling 40, 50 recs. They're having this negotiation conversation with a million candidates and going back and forth with hiring managers on what could move. So just a little bit of kindness goes such a long way. I have two follow-up questions. It sounds pretty clear and straightforward from your four-part recipe. This is what you should say. Don't deviate from this, because this is a solid plan. But what should you absolutely not say in these discussions?

Kate : 30:31

I have a number one thing you don't want to say for an internal conversation with your boss, and that is to use the word fair in any way, shape or form, because, even though it may be objectively true that it's not fair the way that you're being paid, what managers tend to hear with that is you, manager, are acting out of integrity and nobody wants to feel like they're not doing the right thing and you need your manager to advocate on your behalf. Just like the recruiter in the external scenario, your manager is going to be the one who's going to be advocating for your behalf in an internal scenario. So you don't want them to be mad at you or to think, oh my gosh, she thinks fair. I'm immediately thinking wasu and we're going to batten down the hatches and not talk about anything. That's not what this is about.

Kate : 31:31

So if you're really focusing on the external market and not, oh my gosh, my friend Mel is making 20,000 more than me and that is not fair. No, my research shows a job like these are being paid between X and Y in the marketplace. Based on my super awesome thing, I'm targeting the higher end of that range. How close can we get? That's a perfect, legit conversation to have with your boss, but it also pulls the focus away from their actions and protecting the company to what really they need to focus on is what's going on in the marketplace.

mel: 32:12

Follow the formula it works, it works. You talked about gym memberships and getting clear on what you want to negotiate. Are there things you absolutely should stay away from negotiating?

Kate : 32:24

So the gym membership is actually a little foreign my side, because I did have an executive when I was internal to a company that shall remain nameless, who is an executive at a Fortune 100 company, I will say that and who wanted to negotiate every stinking thing in his package, including a gym membership. Dude, you're making so much money. This is worth maybe three grand to you, come on. So, yeah, if you're an executive, don't be negotiating the little things, because everybody will hate you for it, including yourself.

Kate : 33:03

When somebody says, okay, we've had enough, but benefits, you probably won't be able to negotiate anything with benefits because everybody's getting the same thing. You could try, but it's not even worth the effort. To be honest with you, what else do you not want to negotiate? I think that for the most part, work conditions again, some of them, whether or not it's hybrid or work from home situation those absolutely should be negotiated, but negotiate those after you figured out the package, especially if they've hinted through the job description or whatever, that people are part-time, working at home or whatever. Don't be negotiating work conditions before you do your other stuff. What have you all seen that you have with Regis?

Francesca : 33:51

There was an executive he had come from a very large technology company, was going to a smaller technology company that didn't have free food everywhere and asked for $10,000 a year for lunch stipend. And it was like, bro, you're making like $20 million a year, you don't need the $10,000 lunch stipend. Run for the border like all of us. You know what I'm saying.

mel: 34:14

Get real. It sounds like people should be realistic. Focus on your base, focus on the right stuff. One thing that's come up for us recently and it would be fun to go down a rabbit hole to see what people have negotiated you must have some examples, kate, of like weird stuff you've seen negotiated and included. One of the things Francesca and I were talking about recently with all of the layoffs was can you negotiate your severance upfront? Is that something you can negotiate as part of your starting package? If I'm to be laid off within the first year or within the first two years, I'm given this package, an agreed-a-pound package, is that something you can negotiate?

Kate : 34:54

It depends on your level in the organization. Perfectly frank with you. When I'm working with C-suite folks, even in smaller organizations, that is always part of the conversation that we have. But typically below, I would say, a VP level, I haven't seen that because below the VP level there's usually some sort of a policy that's in place Even at the VP level. A lot of times there is too, but it is more common to negotiate it as part of your employment agreement, if you have one, and those typically don't start until VP level. But the same thing goes with relocation. If you're doing a relocation package, a lot of times there's some flexibility, but not a lot, because with larger companies they typically tier it based on the level of job that you're at. And another reason to do away with levels in my own bed. But until then, one of the crazy things I've seen I know somebody who had two great dates who could not fly because they you can't fly, you can't put them under the belt in the plane.

Kate : 36:07

There's biggest of the plane so you can't. But that person was able to negotiate renting a van. They used that as part of their moving. It seems fair. It seems fair.

mel: 36:20

You want your pets or your loved ones. What do you do if you've done the research, you've done the four-part recipe, you've shared the research and they come back and say that's anecdotal information.

Kate : 36:36

It depends. One of the things that I advise people to do too, before they even get to negotiate, is figure out whether your bottom line is, and so you know. Sometimes the bottom line, the offer, is already in there, and so it's okay. If you can't negotiate anything, that's not necessarily a loss. But again, think about how the company is treating you through this process. If somebody told me that my research was anecdotal, I'd be a little pissed off. Yeah, do I want to work here. But if they're saying, hey, that's not consistent with what we're seeing in our salary surveys and you don't know all the stuff that's behind what they're putting in and they may be wrong in your opinion and you're not going to be able to come to an agreement, and that's okay. If they don't value the work the way that you want to be paid you feel like you should be paid then again it's not that it's a bad call by the company or a bad call by you. It's just not a match.

mel: 37:57

Every company also has their own comp philosophy. So who's doing comp right?

Kate : 38:03

Oh, my gosh. I think it depends, and I wouldn't say that any one company is doing a super great job across the board. But my companies that are doing more in terms of salary transparency, pay transparency some of it is fair enough because they wanted to comply with the law. That's always a good thing. But a lot of my clients who are located in California, which is where the big pay transparency stuff is going on, they're being open about it all across the country, even where there's not pay transparency laws on the books, and I think it's just great and people are like oh, that's really simple pay transparency. But what it translates to a lot of different things that really are around health in this area, which is, hey, we're going to be really consistent with the way that we level our jobs, we're going to be consistent with the way that we pay our people. We're going to talk about pay with our employees. Those things are all really great.

mel: 39:06

Are there any companies today that you're like man? They're really progressive here.

Kate : 39:10

Every single company, even companies that are doing well in this space, I'm sure have individuals that they are paying the way that they probably could, and so that's why I don't want to go. Hey, xyz Corp totally is nailing it, and then there's one person getting paid like crap.

mel: 39:28

Yeah, they're like wait, I'm paying peanuts over here. You don't know your time. Yeah, I get it. I totally understand.

Kate : 39:35

Are there any companies that you guys would hold out as?

mel: 39:38

good models in this space. When I think of like good practices, it's not different from what you've already mentioned. It's organizations that are making sure that they're looking at the research, probably in an annual basis, and making sure that people are in their comp ratio and in the market rate and they're really doing that analysis to make sure, if folks are under their market rate, that they're making them whole in some way and finding a way to do that. I think it's hard to get it perfect to make sure that you're trying and in your transparent about the steps you're taking to make it right. I think that's so critically important.

Francesca : 40:17

I've sat at tables where we're reviewing comp and there have been some companies I've worked with where we're not going to talk about things like pay equity, we're not going to have these types of conversations. And then I've also worked at organizations that are very open to that conversation and that might sound really basic, but the ability to even say, hey, we've got a discrepancy here. What can we do to start working towards bridging the gap? I applaud organizations that are willing to have that conversation, because not everybody is.

Kate : 40:45

And, ironically, some of the most transparent with pay organizations that are out there are actually governmental organizations. So, like, my first job out of drug goal was with the sting of Colorado and we had this book and you could look up everybody's spending. And now it's online, because that's how old I am, but we come from book era too. That's the way things work. It's everybody knows what everybody gets paid. There's really a lot of openness about that and people make it their business to know why things are the way they are. It's a really good model and people don't typically go oh yeah, the government. That's where I want to go for my party. They've been doing it and doing it well for years and years.

Francesca : 41:34

Yeah, the best learning and development organization is the military, so they get things right.

mel: 41:39

They do get things right.

Francesca : 41:39

Yeah.

mel: 41:41

But the way that COMP is structured is also evolving over time. I'd love to understand from your point of view, how do you see COMP evolving and how would you like to see it evolve.

Kate : 41:54

Hmm, interesting, two different answers. I think so. One of the perspectives that I carry is that my company is a B corporation, so we're really all about people and planet and profit. So I work with lots of B-corp. I also work with lots of nonprofits. I also work for other companies too, but my perspective with the nonprofit and B-corp group these are mission focused organizations, purpose driven right, and I am seeing a lot of these companies shifting toward employee ownership, which I think is super cool, and there are more and more tools available for organizations that want to go this route than there have been before.

Kate : 42:41

It used to be a very daunting process and I'm not going to say it's easy now, but again, tons more resources, a lot more specialists consulting in that area. So that's one thing that I'm seeing evolve for purpose driven companies and it's pretty cool and also requires a completely different leadership model. Right, a few employees who are owning the company. They want to know the stuff. Right, it's like taking pay transparency to the next level, right? Not just pay transparency, it's P and L transparency and I just I think that's great, I think it's awesome, and I'm also seeing, with these companies purpose driven companies I'm seeing a trend toward really advancing the pay of frontline workers. One of my clients decided that they wanted a family housing wage to be their minimum wage. They pay over 2x what the market rate is for those jobs. That's amazing and I think it's terrific and appropriate. And our minimum wage has lagged from a federal perspective, even our state perspective. I'm in Oregon and, yeah, it's much, much higher than the federal, but I don't think it's kept pace especially with when you look at how our executive pay has shifted over time. So I'm digging those things and those are things that I would want to see every company shift toward.

Kate : 44:12

Well, another thing that I'm thinking about is how have the systems of bias and oppression contributed to our pay program? So I think about antiprecipate a lot, and what can we do to move away from that? One of the things that I try to work with my clients on is removing individual performance as a factor that's going to determine pay. Do you want to still keep track of what people are doing and how they're doing it? Absolutely, that's fine. But we know that it's bias the way that we look at performance. Performance standards for women are substantially narrower than the most for men. For people of color, it's very dramatically different, that behaviors that are okay in the dominant culture are not okay in some of these cultures that have been marginalized by the dominant culture. How can we make pay less problematic from those kinds of perspectives? So that's what I'm really focusing on these days.

Francesca : 45:17

What would be your definition of anti-oppressive pay structures, because I don't think a lot of our listeners know what that is?

Kate : 45:24

Yeah, Well, it's actually a term I came up with. It's some different avenues that we look at in terms of what determines pay. So levels, so the more levels that you have, the more likely it is going to impact people who've been marginalized by the systems, because at every inflection point where you're moving from one level to another, you have this kind of this filtration system that's built in, this social system that's built in, and women, people of color, differently-abled folks, lgbtqia plus folks, they find it harder to get to that next level and I think that's honestly that's going to be the last one to fall, because we think, of course, ceos should make more than frontline workers, but pay is a social construct. We made it up.

mel: 46:18

It's not like there's a law about that, yeah, it could be revolutionary and change it and blow it up.

Kate : 46:26

And I sit on a group with a woman who's a CEO of a B Corp who pays everyone in her entire organization the same, including herself. That's right, though, yeah, 100% anti-oppressive right, because everybody gets it right. So levels are one, functions are another one. We talked about that a little bit ago. Individual performance as a determiner of pay that is huge, and that's probably the number one thing that I'm trying to communicate with my clients is hey, you know what? The government does a great job here. They have step stuff, and I get a lot of pushback. But oh, what about performance? Because that we have to make sure our shiny stars get more.

Kate : 47:13

There's some myth around individual performance in my mind, because no person's an island. If you've got somebody who's doing really terrific work, chances are they've got a really terrific team that's surrounding them, and the big archetype of this is sales. Dude, right, and sales are trillion, trillion widgets, and it's like this rugged, individualist thing and it's a myth, right, it's not a real, true thing, because they've got somebody who's vetting all the leads for them. They've got somebody who's arranging their travel, they've got really great products behind them. All of these things are conspiring to help this sales person be excellent, and it's not that they don't have any value, and they may be fantastic at creating the kind of relationships that lead to long-term success. So I don't want to take away from that. Should we be paying that person 3x what other people get? I don't know. I don't think so. Probably not.

mel: 48:16

Yeah, it makes sense because, to your good point, they're not an island. They have a whole team of people setting them up for success. So, although they help close the deal, at the end, it's all of the steps that led up to that, though, that really helped play into it. So everyone has an equal role in that success.

Kate : 48:32

I really like that concept and there are a couple of other factors too around antipressive pay, things like making sure that people have access, like right now. We talked earlier about the things that are different as you go up the scale and having only executives being able to participate in equity programs or long-term incentive programs. I think that's silly, because people who are on the front line are doing things that are going to impact the long-term success of the company, and LTI tends to be one of the big wealth building vehicles for people, and if you just say, okay, 90% of our population doesn't even have access to that, so go away, that's not great, and when I worked at Intel, they gave every single person stock options and they don't do it anymore that way, but it created this completely different mindset for people who are on the manufacturing floor. That was tremendous and very good for the business. I'd love to see LTI if you're going to use it everywhere.

Francesca : 49:37

Walmart started to do that in terms of options to make their store managers owners in the company. Great, that's the kind of movement we love to see 20K in options which can be, over time, life changing for a lot of people, especially when we think about retirement or having a savings nest.

Francesca : 49:54

The other thing I think about. May I tell a story? I'm going to go on a scenic route and then I'll come back. Mel knows the story. I have two master's degrees. This is not a brag, this is just more funny than anything. I like to be in school. If I won the Lotto I would just go back to school. I love it. But my first master's degree was from Northern Illinois University. My second is from Northwestern. Why am I sharing that? Because when I went to Northern it was if you get a job, you may see this, and at Northwestern is when you're a chief marketing officer. This is what you'll see. And I think the idea of setting a band and saying this is the step, and here's the bar for everybody to hit, here's the bar, as opposed to paying for performance which, to your very good point, can be riddled with bias, and this is a team sport. It's a really interesting inverse, because what I have found is when you say here's the bar and it's an attainable bar, most people will meet it. Yeah, yeah, it gets like.

Kate : 50:57

Everybody wants to come to work and do a good job, right? Nobody comes in and say, hey, I want to be an asshole today.

Francesca : 51:03

There's that one guy the one who's going to come in.

Kate : 51:07

But people love success and they want to get the heart of success and they want to contribute to the success of the organization and they're kept in the loop about what's going on. And again, this is back to some of the things that employee owned companies do. If people are brought along in that venture, yeah, they're going to respond. The problem, like with employee engagement in general and I've done a ton of employee engagement research over my career, which I do like a weird geek about and I love. People need to understand that North Star. They need to feel like what they're doing matters and the more visibility you can create for that, the better it goes. Yeah.

Francesca : 52:11

So, kate, we have something we like to do with all our guests called Wrap it Round. We're going to give you a few questions. What's something that everyone should write into their offer letter?

Kate : 52:21

I don't know, because I work with people at all different levels of the organization. So what's really appropriate for my executive clients? Probably not the same as for my recent college grad, even our recent college grads. I would advise them to ask for a sign-on bonus and, if you don't know what to ask for, 10% of your starting salary, your base pay.

Francesca : 52:44

I like that 10% number, maybe not the use of the company jet, if you're just spitting off, I got it. What's the biggest mistake people make in negotiations?

Kate : 52:54

I think, just accepting the offer on the spot, even if you ultimately accept it and don't negotiate it, because a lot of times what companies will do is try to do what I call the pre-offer. If we said $60,000 right now, could you say yes right now? And it's not a car right? Let me see everything in writing and read about the benefits, because you may find that there's some significant gap that you don't know. So don't say yes on the spot.

Francesca : 53:22

This could be work-related. It could not be. But what do you love to negotiate, oh God?

Kate : 53:27

I love negotiating pay. Now I don't really negotiate my consulting rates or anything, and there's a whole reason behind that, but I just I love salary negotiations so hard and everybody should ask me about it because I will tell you. I will tell you all the things and I think it's super fine. My son is like my hype man and so he makes all of his friends call me and yeah, let's talk about it. So I love paying the compensation.

Francesca : 53:53

I really do. You should have like a ticker tape of how much money you've gotten people Like 70 billion served. I love that.

Kate : 53:59

I should, because, like my top one, I ever did a million and a half.

mel: 54:05

Wow, get out of here.

Kate : 54:10

I was walking with a little swagger there for a second. We should, oh man.

Francesca : 54:15

Kate, we need to talk. Yeah, the trinities. This might be a very philosophical, perhaps a stoic question, but what should you never negotiate?

Kate : 54:26

in life, never negotiate things that don't really matter. We talked about the little things in an offer. It doesn't matter. Let go, you can use your energy better elsewhere.

Francesca : 54:39

Yeah, I love that so much of life is energy management, isn't it? Yeah, yeah, listen. I think everyone should read. Payup Name your prices are amazing books for everyone to read. Kate got into some of these things today. But, kate, I'm curious what other book would you recommend everybody read?

Kate : 54:57

One that is just on my mind recently because I heard the author speak yesterday is called Career Forward and it's by Christiana Giesmit Giesmit's. She it's terrific. It gives you lists of things that you can do and think about in your career to manage your career better, and it's really good.

Francesca : 55:16

One is you'd mentioned meditating in terms of getting into that mindset. Do you also recommend that folks have a hype song? I know a Nike there there's like the hybril. We get that sort of thing. But should people have a hype song?

Kate : 55:26

So my son was a baseball player and so he always got to pick his walk on song every season, and I love that. I think it's a great idea because we know our neural pathways. Sound allows us to dip into that space pretty easily, so maybe it's a walk on song, maybe it's the song that you play to calm your nerves or whatever, but however you want to show up in that moment, pick a playlist or a song or whatever to play beforehand. I love that idea.

Francesca : 55:58

What's yours If you had a walk on song, what would it be? I think it depends on what it was walking on to.

Kate : 56:04

This was like totally silly, but I love the song Happy. It was one that I played over and over when I was running half marathons and stuff, and so it just has all this good vibe. It's a jam. What's yours? I have to know that.

Francesca : 56:22

I have two. One is let's Dance by David Bowie just a jam. Two is Nas made you look which is a stuff I probably thought. No, what's your theme song?

mel: 56:35

Oh my God, I was just thinking of Rihanna's bitch, but I have my money. That's probably really inappropriate. That's her salary negotiation.

Kate : 56:46

I don't know, I think it's good.

Francesca : 56:52

This has been so wonderful. Let's talk with you today. Thank you so much for sharing your expertise with us, my great pleasure.

Kate : 56:59

Thanks for having me.

Francesca : 57:08

Thanks so much for joining us today and subscribe. Wherever you listen to podcasts, you can come over and say hi to us on the TikToks and LinkedIn community. Hit us up at yourworkfriendscom. We're always posting stuff on there and if you found this episode helpful, share with your work friends.

mel: 57:25

Thanks, friend.