Understand the market
The first step in making sure you earn the salary you deserve is to know what the going market rate is. Do your research: if you don’t know what others are earning in your field and at your level then you’ll always be standing on shifting sands as you negotiate.
There are a variety of sources of information in this regard. Online salary calculators are available from websites such as Payscale, Glassdoor, Career Contessa, Salary.com, and LinkedIn Salary. Legal.io has its own pricing tool to show the average salary of attorneys by location and practice area here.
Recruitment companies may be another source of advice. And, of course, you can ask people you know, too. It may seem intrusive to directly ask someone how much they earn, but you could always ask someone more senior than you what they earned when they were at your level, and what the general progression was in their career.
Make sure you factor in all the relevant issues, too. Your particular experiences, success rate, education and even your location may mean that the “average” salary isn’t the right one for you.
Don’t be afraid to ask or negotiate
Probably the biggest reason that people are underpaid is a fear of asking for more, or negotiating an offer. This applies at the job offer stage, but it’s perhaps even more relevant after some time at a position. During the recruitment process, there is an obvious point where salary can be discussed; but as time goes on and you accumulate increasing responsibility, there may be no clear juncture for you to stop and speak to your manager about how your salary hasn’t gone up alongside your workload. It’s up to you to make this time: after all, your employer’s interests don’t lie in doing this for you.
There are also a number of demographic effects in play here. Millennials are often less likely to try and negotiate their salary. This is thought to be because they came of age during the global recession of the late 2000s and early 2010s, when jobs were in short supply, and they have absorbed the idea that they should take any job offer that comes along. There is also considerable research on a gender gap in willingness to ask for raises, with many studies finding that women are less likely to negotiate a salary or request a raise - although some studies suggest they are just as likely to ask, but less likely to receive a better salary.
Be aware of anchoring effects when negotiating
Anchoring effects are a fertile area of research for psychologists and are beloved of marketers. But what are they, and what do they mean for a salary negotiation?
To see how anchoring effects work, let’s consider an experiment by Nobel prize-winning psychologists Daniel Kahneman and Amos Tversky. The two Israeli-American academics began by asking one group of people whether they thought Gandhi was older or younger than 114 when he died; another was asked if they thought he was older or younger than 35.
Having responded to this, each group was then asked how old they thought he was at the time of his death. Intriguingly, the first group’s answers to this question were much higher on average than the second. The two groups of participants seem to have had ‘114’ or ‘35’ set as an ‘anchor’ in their minds, and their responses clustered around the initial figure asked about – even though this had no logical relationship to Gandhi’s final age.
In other words, once you mention a number, it sets a baseline – whether it logically should or not. This is something to bear in mind if, for example, you are being underpaid in your current job and you are negotiating your salary in a new job. In this situation, you might want to avoid plainly stating your current salary, as it could set the anchor around which the employer will consider what it’s reasonable to offer you. Of course, if you’re asked, you can’t be dishonest, but mention the figure along with a number that reflects what you feel you should be paid. Say, “I know that I should be paid close to $55,000 in this role, although due to factors x, y and z I’m receiving a figure below my value – $45,000.”
With some solid research, a willingness to ask for what you want and some tactical framing, you’ll be in good stead when it comes to obtaining the figures you should be earning.