Five top tips for negotiating a pay rise

ASKING for a pay rise is awkward, but this expert says your boss is probably just as nervous as you. Here’s how to pull it off.

ASKING for a pay rise is incredibly awkward.

Considering Australians are currently stuck in the lowest level of wages growth in at least two decades — with pay packets increasing an average of just 1.9 per cent last financial year — it’s probably been a while since you asked for one.

“This low wage growth reflect, in part, ongoing spare capacity in the labour market,” Australian Bureau of Statistics chief economist Bruce Hockman said August.

On that basis, most people probably fear being let go and replaced if they ask for too much (just ask former Today host Lisa Wilkinson).

Dan Hughes, a master negotiator who appeared on Britain’s Channel 4 this week, said most people don’t ask for fear of damaging their relationship with their boss.

However, the reality is it’s extremely difficult to fire people — unless you do something like literally setting your workplace on fire.

“Don’t worry, the worst that can happen is you’re no worse off,” he said.

He said there are five things you can do to improve your pay.

STEP ONE

Make sure you’re prepared, and give your boss some warning.

Figure out what you’re worth and what value you add to the business, and write down what you’re earning now and how much you’d like.

Depending on the nature of your job, as well as the conditions set out in your award or enterprise agreement, you boss may not be able to control your pay.

However, you may be able to negotiate with your boss for things like better shifts, or perks such as a parking space, so write them down too.

STEP TWO

Don’t walk in and simply ambush your boss — prepare the ground by emailing them or mentioning you’d like a rise in a chat prior before you request a formal meeting.

That will give them time to think about it and work with you toward a solution.

STEP THREE

Plan the pay talks carefully — and think beyond your opening position.

Mr Hughes said you should assume your boss will initially say no, so it’s important to have some contingency plans ready to go.

Always try getting something else before lowering your demand.

STEP FOUR

Your boss is probably just as nervous as you, because they don’t want to lose you.

Don’t worry about feeling ­uncomfortable. Your boss is probably a bit nervous as well and even if they can’t give you a pay rise, they don’t want to demotivate you or lose you.

STEP FIVE

Even if it doesn’t work this time, you’d sown the seed of the idea that you’re worth more than what you’re currently getting paid.

To show you’re motivated and invested in your job, ask your boss what you need to get in place for a pay rise and organise a review in six months.

Mr Hughes said you should avoid discussing your colleagues’ wages, because it can give them an easy way to make an excuse, and you shouldn’t threaten to leave because they may call your bluff.

You have nothing to lose by having the conversation — and according to finance expert David Koch, a raise could make up to $1 million difference over the course of your career.