Future Consideration in the Job Market

by Mr. Cheap

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Apparently it’s quite rare for actors to get paid in the Toronto theatre scene. Every production basically says “work for us for free, you’ll get exposure, then you’ll be able to get good pay from the next production that hires you”. When the next production starts, they say the same things, and actors go through this until they demand to be paid (at which point another actor steps in and works for free).

I’ve had similar experiences in the tech field. Because technology is constantly changing, it’s very common to come across job postings that require technology you haven’t been exposed to. This used to intimidate me a bit, until I realized that employers are posting their “dream list” of experience and none of the applicants are coming in with the full background they ask for.

I had the experience where employers would say “start working for us cheap, learn the technology, then when you get up to speed we’ll pay you full rate”. This made sense to me, and I actually fell for it a few times, but inevitably what would happen is I would feel like I was up-to-speed and they would still want to keep paying me the original salary at which point I’d leave.

Once I stopped accepting lower paid positions, I was surprised that they’d then offer me the job at a competitive salary. The whole idea of “low pay while you learn” was just a negotiation technique, not anything they actually meant. ONE TIME a guy said to me “well, I’m not going to pay for you to learn on my dime”. His position was still posted 2 months later (and he e-mailed asking if I knew anyone job hunting with the required skills).

A friend of mine will be leaving a position soon where she went WAY beyond what she was hired to do. At the end of the year she asked for her salary to reflect what she was actually doing, instead of the subset of her work she’d been officially hired to do. After dicking her around, the company eventually refused to give her any significant increase in pay. They’re freaking out as she’s wrapping up the position, but they lost her rather than consider a large pay increase.

At many positions I’ve worked at, at some point the idea was thrown out that I’d eventually be moving to a higher ranking position in the company. Again, this was a free carrot for the company, as they didn’t have to deliver on any set timetable, but their hope would be that it’d be enough to keep me around as I thought I’d be working my way up the corporate ladder.

Sadly these days, the only way to get a significant raise or promotion seems to be to move to a new position in a different company. Loyalty in the workplace is dead.

I’m not sure why, but my experience has definitely been that once a company has a person in a set position at a set salary, they don’t want that to change. Even if the person is doing vital work for the company, keeping things the way they are seem to be more important that keeping that person. My only theory is that the companies don’t want to feel that they’re being strong armed by key personnel and would rather let those people leave the organization than give them the power to put the company over a barrel. Amusingly, while they refuse to give significant salary increases, they love to promise them at some indeterminate future time.

Some relatives of mine own a company, and every time business improves they have one key employee who then demands a raise. They’ve gotten quite sick of it (although he is vital, so they always give in) and recently have hired a junior person for the same position. Their plan is to say no the next time he wants more money (and they hope having the junior person will help them weather the storm if the senior guy quits). I definitely understand the issue from their perspective as the employer and how they don’t want to feel dependent on any one employee.

Craigslist is full of wanna-be entrepreneurs who will happily throw equity at anyone who can turn on a computer. They promise executive positions and lavish salaries once they’ve become “the next Google”. Sadly, every one of these people I’ve ever talked to is totally clueless, and doubtfully will even become the next Pets.com.

Future considerations have some value, but unfortunately it’s usually FAR, FAR less then what people want us to value it as. In any business agreement, I’d basically view future considerations as “sweeteners” and not enter the agreement unless it’s worth doing without those considerations.

Have you ever been promised future consideration in the workplace? How often do you receive it? Have you ever managed to come into a workplace in a position then get a dramatic raise or promotion on-the-job? How did you do it?

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{ 22 comments… read them below or add one }

1 Ron@TheWisdomJournal

In my last position, I absolutely loved what I was doing, where I lived, my co-workers, and everything was fantastic. Only one problem. no raises in 4 years. It was a startup and I understand that, but we were only 10 people and were netting, NETTING over $800,000 per year.

My boss said to figure out a way to give myself a raise that doesn’t cost the company any money. WHAT??

That’s when I started looking. The problem now is that I make a fantastic salary, but wise I was able to do this job back home. :sigh:

2 guinness416

I’ve always found the difficult thing to be vacation time rather than money, which may be the different industries. I recently got a raise and a new title, and was quite pleased – until I noticed that everyone else with a similar title gets more time offf than me, and a few other perqs that haven’t come my way. Now I gotta sit tight until the next review in November. This isn’t the first time this has happened to me or those around me. Drives me up the wall.

3 Four Pillars

Pretty interesting. I’m not a job hopper so I haven’t gotten the pleasure of getting ripped off as you describe.

I think in some situtions though you have to do an “internship/slavery” in order to switch careers, learn a new technology, re-enter work force etc.

Mike

4 telly

I’ve basically been working the same job for over 7 years. My title has changed a couple times but it’s the same old thing (which I really don’t mind). Surprisingly, I’ve doubled my starting salary, so I guess that would mean I’ve averaged a 10% raise / year (and it’s not due to hard work or sleeping with the boss ;) ).

My most recent raise / promotion propped me up about 20%. It may not have been the most ethical way to go about getting a raise, but hey…it worked!

I brought a job offer to my HR department and asked them to match it. Thankfully, my boss is way cool and was totally supportive of my efforts. The timing was great because I had just filed a patent and published a technical paper in the couple months prior. They didn’t match it outright but came pretty close which was enough for me (considering the other position would have entailed a move…though HR didn’t necessarily know that).

Sometimes you have to play their game is new motto!

5 Mr. Cheap

Mike: I was going to mention internships but skipped it in the end. As much as companies love them (and try to promote internships as a basic step to starting your career), at the end of the day its unpaid labour for the company. Quite a few companies in Toronto offer unpaid positions to “gain the Canadian experience”. This just seems to be exploiting immigrants to my mind. I saw a company that was offering crazy low salaries and I sent them an e-mail to tell them they probably wouldn’t get anyone decent at those rates. The guy wrote back and said “that’s what we’re paying Waterloo co-ops, so that’s what we want to pay full-time for the position”. So all the co-ops had done was drive the salary for that position into the gutter.

telly: Good for you! That can be a dangerous game (your boss may have taken exception to your tactics), but if you’re willing to take the risk that’s certainly one way to force a raise.

I always offered to sleep with my bosses, but none of them ever took me up on it :-( Never tried this “hard work” thing you’re talking about…

6 Canadian Dream

Mmm, I find with my field in engineering it is a bit different. Every year each association does a salary surey of the members and sends out the results. So basically I take an offer and compare it to the latest data. It’s never once been out the range. Why? The employers aren’t dumb, they know if they don’t fall in the range they won’t get people.

The trade off is it is hard to get very high pay that is over the range and there is no data on benifits.

Tim

7 telly

very nice Cheap. :)

I agree MC, but if it didn’t work out, I was willing to take the other position as I was truly interested in it and as I mentioned, I have a great relationship with my boss. In the process though, I actually discovered that this is common practice at my company. In fact, the HR manager basically said that this kind of thing happens all the time!

8 NeverStopBuying.com

I have only switched full-time job once, but from experiences and friends I do believe the only way to get a raise is to jump ship, sadly

Being in IT, it comes with the territory. You rarely see one IT person at one company for 5+ years. Personally, even if everything is great, I still might want a change, try something new, and constantly challenge myself to not fall into a comfort bubble (FrugalTrader quote)

I like perks such as conference, travel, vacation time, good benefits. Money isn’t #1, but it sure matters.

9 telly

CD,
How do those ranges compare to those on salary.com for example?

I’m an engineer as well and I managed to get a hold of a salary grade ranges for my company. I was floored when I saw the ranges (we’re talking $40k spreads at entry levels and it only gets wider as you move up bands)!!!

10 Mr. Cheap

tim & telly: The salary bands could be great to make sure you aren’t underpaid, but as you point out, it can make it hard to get overpaid. It kinda turns engineers into a commodity (which they certainly aren’t).

I love companies that claim to “only hire the best” then they want to pay them “industry average” salaries…

11 Four Pillars

It kinda turns engineers into a commodity

Oh yes they are…

Mike

12 telly

I certainly think it’s possible to be overpaid at my company (based on the scales I saw) but just to be clear, I’m paid nowhere near the top of my salary band!! Makes me think I was seriously underpaid for several years…as so many of us realize when we move to new companies (or hear of others that have).

I always enjoy your salary posts MC.

13 ThickenMyWallet

Companies have really lost their drive to train and develop talent. It would be one thing if they paid you below market but gave you great training or put you into a management trainee program but to ask you to work under market rates is just plain dumb talent management.

If they offered you some future increase in salary, I would have that put in writing including the criteria and when they will give you a raise. Everyone knows that the situation may change but if they can’t back the concept of a future raise in writing then they were never serious to begin with.

The whole “we’ll give you equity” is something I would only do if they offered a management positions and you got to look at their books. After all, if you are going to own a piece of the company, shouldn’t you know everything about it?

14 Kim

If I’m offered a ‘carrot’. I get it in writing with a firm timeline.

15 EmperorCoder

I’ve been with the same company all my working life (8 years).

My personal experience is totally opposite of Mr Cheap. I feel I’ve always been treated well salary-wise (10%+ rise per year, topped with stock options and bonuses). My bosses have always recognized my performance and contribution to the company without me having to negotiate anything.

Maybe I got lucky to work on projects which were higly profitable for the company, but I do believe I deserved part of that success because of my implication and work. I do work in a highly competitive business where talents are scarce (video games programmer), so that helps.

One year after my annual performance review, the HR girl told me quite frankly that if I got an offer from some other place, that they’d try to match it. I was surprised that she was so direct and proactive. I never used the strategy though, they always treated me fairly, I was never compelled to.

I guess it’s 80% luck. I got hired at the right time in the right company, in the right industry, with the appropriate skills. YMMV.

Emp

16 Kim

It could also be your level of work. I get raises without asking because my company needs me and they like my work.

Maybe others should get the hint?

17 Gates VP

Ron: was that “net” after or before salaries were paid? With or without investor payback, etc. Like was there a pool of 800k just sitting around every year that was owed to no one?

For that to be the case, each of the ten employees would have to be generating $40/hour of profits per employee! That’s a pretty huge number!

Otherwise, 800k basically covers 10 salaries at 40k / year :(

Cheap:
… once a company has a person in a set position at a set salary, they donít want that to change… keeping things the way they are seem to be more important that keeping that person.

I honestly think that this is directly related to the fact that most employers are just bad at employee development. The best companies are constantly looking for ways to raise everybody’s salary, the best companies are offering their employees pay raises and drafting annual performance plans.

But most companies are just trying to fill gaps. The reason that most people only get pay raises from company jumping is that most companies don’t have a plan to give them a raise. The average company isn’t in a growth phase, they’re trying to keep costs down. So they (mistakenly) figure that stalling promotion is a good way to do this.

Many companies ignore the cost of finding good employees (just like the people who ignore the cost of car ownership when they figure out the size of their car loan). And let’s not forget that most people inherently fear change.

If you’re new to an industry, you’ll likely have to accept the short end of the stick. But keep your resume ready. I wouldn’t accept “future consideration” unless I was really comfortable or in control of the risk.

18 Gates VP

Quoted for truth: Everyone knows that the situation may change but if they canít back the concept of a future raise in writing then they were never serious to begin with.

19 Four Pillars

It could also be your level of work. I get raises without asking because my company needs me and they like my work.

Maybe others should get the hint?

Kim, my company gives everyone a raise each year because we keep breathing. If they are trying to give me a hint to keep breathing then I guess I’ve gotten it. :)

Mike

20 Canadian Dream

Telly,

I’ve never compared them. I would guess salary.com uses the fedral government’s data which really is the sum of each provincial association data.

I always prefer the local data as it reflects the market I’m looking at better.

Tim

21 telly

Tim,

You can display data on salary.com by city, though I’ve found that sometimes you’re better off not knowing! ;)

22 Ana

I never tried working in a big company but I think if I would be given a chance to work in a company I won’t try job hopping and would not try to ask for increase. I will just wait for my employer to give me one.

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