How to negotiate salary at a school with a two-stage negotiation process?

Question

I have a tenure track job offer from school S. This school appears to have a two-stage strategy to negotiate a low salary with candidates. Early in the process, HR discusses the salary range, [MIN, MAX]. At a later stage, when the first candidate is chosen, in the first step HR will negotiate with candidate, to a mutually-agreed compensation; that's proposal A. After A is reached, HR will say, this is now my proposal; department still has to approve my proposal! Then comes the department head, which reduces the compensation further, to proposal B, likely to be the MIN value! The department head states that this is the final offer and cannot be negotiated.

I am in an excellent position to get several offers from other institutions. But results will appear in March or afterwards (some applications are now just being reviewed). On the other hand, if I accept the offer from S, it's not ethical to withdraw and join other schools later on.

The strategy of S sent me a negative signal about the school administration. However, I much like the faculty there and the school and the program are great fits. I am giving it a second thought whether I wish to join S. I now have to decide:

D1. Insist on proposal A (despite the fact that the department claimed that offer B is not negotiable)

D2. Reject the offer, do not live with a low salary, and pursue other applications for good (including an rearlier delayed offer)

D3. Accept the offer B, and don't argue over a few k USD a year.

Using this experience as an illustrative example, I would like to ask some general questions. The questions might be of interest to all applicants seeking faculty positions, when they negotiate salary:

Q1. Is two-stage negotiation a well-known business strategy to lower compensation package?

Q2. Is it ethical for HR to agree to a proposal, and later claim that it was countered by higher authority?

Q3. To what extent HRs have autonomy in negotiations?

Q4. Statistically, how often "final offers" are bluff/final? Your answer could depend on who says "this is our final offer and non-negotiable," HR or upper-level authority.

You may consider several cases for HR:

HR1. HR declares his autonomy level "before hand." For instance, he or she may say "Before starting, I would like to brief you on our procedure ... ", or "I am in full charge."

HR2. HR does not make any statement regarding his/her decision making independence. It may do so after a first agreement.

HR3. Employer sets bounds (MINs and MAXs). By definition, HR should be able to make independent decisions withing those bounds. Otherwise, the HR, the candidate, and the negotiation process, are being dismissed and disrespected by institution (and what's the point of negotiation with HR).

Answer 1

While I do appreciate the concern related to the competitiveness of the academic market, I'm especially concerned at the idea of taking an offer to work at a place where unethical business practices are accepted as the norm and you are just supposed to take it or leave it. While I think you can be the only person to choose what's right for you and your family, if you are in the personal position to be able to say "no thanks", even if you might not get another offer - then I'd strongly suggest you not be manipulated into a sort of "just be happy you have a job" situation using strong-arm tactics. You can push back or walk away - or pretend to, as JeffE says - but I would not suggest you just roll over and take it if you don't have to.

Why is this a problem?

This Is Called Low-Balling

First make what you want the other person to agree to easy to accept by making it quick, cheap, easy, etc.

Maximize their buy-in, in particular by getting both verbal and public commitment to this.

Make it clear that they are agreeing to this of their own free will.

Then change the agreement to what you really want. The other person may complain, but, if the low-ball is done correctly they should agree to the change.

The trick of a successful low-ball is in the balance of making the initial request attractive enough to gain agreement, whilst not making the second request so outrageous that the other person refuses. It nevertheless is surprising how great a difference there can be between these two requests.

The fact that HR specifically told you that you are in "full charge"? Yeah, that's part of the low-ball technique. They are all playing the same game, together. HR is the good cop, the helpful salesman who really wants to get a great deal.

Guuguen and Pascual (2000) found it to be important that the person believes that they have made a free and non-coerced agreement to the first request. In particular adding 'but you are free to accept or to refuse' to the first request increased compliance.

First, they put out a feeler - asking for a range. That's ethical, honest. Then they get you to show interest, negotiate, spend some time - make a commitment. OK so far. Then you come to an agreed upon decision...that's where honest negotiations end.

The "gee, I'd really like to do that, but my [boss/sales manager/department head/dean/provost]"...that's normal for a used car dealership in Fargo. How about they offer you a clear coat upgrade to go with being tenure track - just 10% off your salary. It's a real steal, we don't normally do this, but you seem like a real smart guy. Please.

Let's Talk Payments

If they want to negotiate, by all means if you are willing and able to negotiate, have fun. Yes, you do need to be able to say no, and perhaps you need to get past embarrassment and contact that previous offer or stall so you can have the comfort to mentally know you can turn this offer down no matter what.

"Gee mister, I sure do like your school, but since I originally talked with HR I've had to consider some very compelling other options [like telling you to shove it]. I feel bad about this - truly - but I think my original agreement with HR for X was lower than I should of been willing to accept. It seems like X+10% is really what I should have agreed to.

This is within the range we had originally discussed, and I feel bad about bringing this up now, but I wasn't aware of these other options at the time."

Maybe, you feel awful bad about this - but you suppose, if it would just be too terribly untoward to want more than HR originally OKed, the department being so great and the department head being clearly such a great guy, you'd be willing to accept something more like you originally agreed to with HR.

Or you can be angry and make it clear that you can't negotiate with such a thing on the table - the walk-away. But you have to be actually willing to walk away.

They seems to want to play games, and turn-about is fair play. But you have to be willing to turn down the offer and do something else, period, or it won't work out so well.

Still, I'd warn you that they are telling you now - far in advance of joining - that they are willing to negotiate all the way to playing unethical games with their offers and candidates, including wasting their time and reneging on phantom offers. If your facts are correct, this is not a accident - it's a design.

Personally, of all the jobs I've had I've only had one employer of any kind - academia, small business, or large enterprise - try to low-ball me like you describe here. And I didn't even try to negotiate that one - I just silently thanked them for letting me know they think it'd be OK to play games with my livelihood before I joined, and I got out of there with all haste, so I can't say how "winning" might work out.

Answer 2

To negotiate, you need leverage. This almost always means another offer or a credible threat that you can get another offer.

I am in an excellent position to get several offers from other institutions. But results will appear in March or afterwards (some applications are now just being reviewed).

If the following conditions are met:

• you believe that
• they believe that that is possible
• they believe that you believe that
• you are okay with being jobless for a while

Then you have room to negotiate. My off-the-cuff guess, assuming those conditions are true, you could get something between what you are offered now and what you agreed with HR. Negotiation is always risky if you are completely bluffing.

I do raise my eyebrow: academic markets tend to be pretty competitive. The second condition above I expect to fail. The only mystery to me is why they felt doing a good cop, bad cop routine and then offering you a low salary was somehow more effective than just offering you a low salary, which you would also have had to accept, because your market rate is still abysmal. Perhaps this is a sign they aren't as sure of their low offer as they project or perhaps someone read some crappy self-help "negotiate your way to being your own CEO" book and implemented it as policy, I couldn't tell you.

On the other hand, if I accept the offer from A, it's not ethical to withdraw and join other schools later on.

It is ethical to stall. It's hard to stall for several months, but you may use the fact that you are willing to stall and they would like to get on with hiring their recruit as leverage. Something that boils down to asking for a relatively modest pay increase or else you would prefer to wait longer.

Answer 3

After A is reached, HR will say, this is now my proposal; department still has to approve my proposal! Then comes the department head, which reduces the compensation further, to proposal B, likely to be the MIN value! The department head states that this is the final offer and cannot be negotiated.

I would treat this offer from HR as what it is, a non-commital, non-binding declaration, but nothing more. To me, this has the same character as an applicant stating that "he is certainly interested but needs to clarify with [whomever]". Just like the department would be asking for a stronger commitment, you are in the right to ask for an actual offer before accepting anything. It is not stalling to say that you will not be making a final decision until you have a final offer - it is just good sense to do so. I would not consider it unethical to renege from the negotiation in the second stage, if HR presents the first offer as fixed and the department head later on does not come through.

The department head states that this is the final offer and cannot be negotiated.

People like to state this a lot. It is usually not true. Also, if you actually have other offers (like you assume you do), every offer gives you at least 2 choices - take it, or go for another school. It is not like you have to accept whatever "final" offer they give you.

Answer 4

Since you don't have other offers in hand, it appears your options are (A) reject the offer with the possibility of having no job or (B) accept the position because you value that more than the salary difference that you are negotiating for.

But don't put your hopes on some future job offer from another school!

Although it is bad to reject an offer that you have already accepted, I have heard of it being done and I think any reasonable person would do it too if they got a much better offer later on.

As far as is this type of negotiating normal? I have always been told to not even negotiate salary for faculty positions since it is competitive enough, most people aren't going to reject the offer over 5-10k unless they have other offers, and some places have standardized salaries.