Thursday, November 21, 2019

Asking for a Raise - Hoke Nails It.

How do you go about asking for a raise?  It is pretty tricky!

A reader asks me how to go about asking for a raise.   Tough question, and I don't like to give advice.  If I give you advice and then you ask for a raise and they fire you - am I to blame?  You see why advice-giving is fraught with problems.  You are on your own, here!

But this got me to thinking, the best example I've seen - even if it is fictional - is the scene from Driving Miss Daisy where Hoke Colburn, Miss Daisy's chauffeur, asks his boss, her son "Booley" Werthan, owner of Werthan Bag and Cotton (now Werthan Industries) for a raise.   The way he goes about it is sort of sneaky, but ultimately successful.

(Note:  I cannot find this clip online, the Miss Daisy people are pretty proactive about their copyright claims.  I found the hiring scene above, but it likely will be taken down in short order.)

At first, you might think that Hoke is in no position to negotiate a raise - after all, the movie (and play) takes place in the South before the civil rights era.  Nevertheless, white people were dependent on their black "help" as it were, and in Hoke's situation, Booley is dependent on him to look after his Mother - who after all had a hard enough time adapting to Hoke's presence in the house.  Hiring a replacement would be difficult, to say the least.   Giving Hoke a raise ends up being a lot easier than hiring someone new, even if it was difficult to swallow.

But if you look at the scene, you see that Hoke has done his homework here.  He catches his employer off guard, and has done the research and actually has a job offer (although the doesn't put it that way) and when offered a raise, makes a counter-offer.   This is not to say this always works out. You have to be indispensable to your employer, or at least make it a lot less hassle to give you a raise than to hire someone else.

Because that is what it comes down to - will you leave if you don't get the raise?  Or will they fire you and hire someone cheaper, rather than give you one?   Asking for more money isn't something that you can do without risk.   And no, no one is "entitled" to a raise.

The scene starts out in the outer office of Booley's secretary, the long-suffering yet loyal Mrs. McClatchey.  Note that Booley hasn't scheduled an appointment to talk about a raise.  I think this is a good strategy.  If you telegraph your intent ahead of time, your boss now has time to think about this - and think about whether it is easier to replace you.
Hoke: Morning, Miss McClatchey.
Mrs. McClatchey: Well, good morning to you.
Hoke: Can I see him? 
Once inside, Hoke doesn't get right to the point, after he sits down with Booley.   Rather than ask for a raise, he merely points out that others are hiring and willing to pay more.   Making ultimatums or threatening to quit can backfire - your boss may take you up on the suggestion, or fire you.  No one likes to be blackmailed, particularly by an underling.
Hoke: It's Mr. Sinclair Harris, sir.
Booley: My cousin Sinclair?
Hoke: His wife... The one that talk funny.
Booley: She's from Canton, Ohio.
Hoke:  She's trying to hire me.
Booley: - What?! -
Hoke: Yes, sir. She said: "How they treating you down there, Hoke?" You know how she sound, like her nose stuffed up. So I said, "Fine, Mrs. Harris, just fine, thank you." She said, "Well, you looking for a change, you know who to call."
Booley:  I'll be damned!
Hoke:  I thought you ought to know about it.
Hoke is making it out to be like he is a friend of Booley and alerting him that someone is trying to poach his employee.   But Hoke is also showing, subtly, that he has a hole card to play.  Even if it means working for someone from "Canton, Ohio" Hoke has employment options.
Booley: I'll be goddamned.
Hoke:  Ain't she a mess? Said, "Name your own salary."
Booley: I see. And did you?
Hoke: Did I what?
Booley: - Name your own salary? -
Hoke: Go away. What you think I am? I ain't studying working for no trashy something like her.
Booley: But she got you thinking, didn't she?
Hoke: Well, sir, you might say that. 
Booley is no fool, of course, and he sees Hoke's underlying purpose.  But Hoke again professes his loyalty to Booley.  He would like to continue to work for Miss Daisy (and no doubt would have, even if a raise was not forthcoming).   But he does have options, here - higher-paying options.  And he is presenting this to Booley in a very tactful, yet compelling manner.
Booley: Name your salary.
Hoke: That's exactly what she said.
Booley: Well, how does $65 a week sound?
Hoke: Sounds pretty good, sir. Course, $75 sounds better.
Booley: It sure does! Beginning this week.
Hoke: That's mighty nice of you. I sure appreciate this.
Booley: Thank you.
Hoke: You ever have folks fighting over you?
Booley: No.
Hoke: It sure feels good.
Having people fight over you sure does feel good, which is why when applying for a job, you should use a shotgun and not a rifle.  When you have two or three job offers to select from, you feel like people are "fighting over you" and you have power and leverage.

And I guess the same could be said for asking for a raise.  If you go in, without doing any research or having any data to present to your employer that you are underpaid, you are using a rifle.  They can say yes or no, and you have no leverage or power in the situation.

(It goes without saying, that if you do the research and find out that other companies are paying less, then maybe it is time to just keep your mouth shut, for the time being.)

And this is where it gets sticky.   Are you willing to quit or be fired over this?   Because if you do this wrong, and come across as saying "pay me more or I quit!" they may call your bluff.   A friend of mine did this recently, telling their employer that they deserved more money.  They did some research and showed that someone in their position should get more in salary.   But they set a deadline and told their employer that unless they got the raise they felt they deserved they would quit.

Well, the deadline passed months ago, and they are still working for the same company.   And no doubt as a result of this ultimatum, their job is no longer secure.  Like I said, no one likes to be blackmailed.  And I think the employer realized that the employee didn't have many options, unless they were prepared to pull up stakes and move away - which they were not prepared to do.

Before you quit a job, think about more than just money.  Mark was "promoted" from Sutton Place store manager to a job in the corporate office.  But the hour-long commute to Bethesda every day took a toll on him and our car (which ended up getting wrecked).   The increase in salary was nearly wiped out by commuting costs.   Plus, he loved being a store manager (although it was hard work) but hated the politics and endless meetings in the corporate office.  He ended up quitting after a year.

There are other things to consider besides money - and benefits, of course.   If a new job means a horrible commute, factor that in.  If it means leaving a prestigious company for a lesser-known one (which might not look as good on your resume), factor that in.  If another company has an odious reputation as being a crappy place to work, factor that in - is it worth all the money in the world to work for a place with a tyrannical boss, horrific office politics, and back-biting and hostility?

And in that regard, sometimes a premier firm is a good place to build your resume, even if the pay isn't as good. When I left the Patent Office, I took a job with a downtown firm that had a good reputation.   I liked the work and it was the highlight of my resume.   I spent five years there, but left when the firm split in half.   I just wanted to write Patent applications without a lot of office drama.   I went to a firm in Alexandria that was not a prestigious, but paid more money - like $10,000 more. My boss at the old firm, when I told him, offered to match or exceed that salary (why didn't he offer that before?).

But he did make the point that I was leaving a "name" firm for a much smaller operation, and within a year or so, I left that firm and started my own practice.  Turns out, the new company had problems of its own.  I would have made a lot more money staying with my first firm, to be sure.  But I guess there were non-monetary considerations, and that was why I set out on my own. Money isn't everything.

You have to think about this in terms of your overall career, too.  If you have been at a company only a year or two, and quit or are fired, it isn't going to look good on your resume.  As a hiring employer, I received a resume from an applicant which had no fewer than ten jobs listed, some lasting as little as six months.  In each case, the applicant had a reason why he quit or was let go - usually that the boss was a "jerk" or that the company was "messed up".  You can imagine what would have happened if I hired them - I would not want to be short-term employer number eleven.

Bear in mind that you are not entitled to raises, or indefinite raises and that getting a raise can end up backfiring on you.  It is true that once an employee has been trained and gains experience, they are more productive and are worth more to the company.  On the other hand, that initial training may have been a loss-leader or a break-even situation for the company.

In the law business, everyone wants the associate with "two to six years experience" - no more and no less.  They want to poach an employee who has been trained already, and is instantly profitable.  But they don't want the senior associate who demands a higher salary, but doesn't have a client base of their own.  I suspect the same is true for a lot of other businesses as well.  It may be tempting to do a lateral after you've been trained, but what does that say about your loyalty as an employee?  It could come back to haunt you later on.

And when it comes to downsizing and layoffs, raises can backfire.  In many companies I worked for, senior employees, after decades of working, were making fantastic salaries, with raise after raise every year.   By the time they were in their 50's, they were making double what a younger employee would be making.  It was a no-brainer decision to lay off the expensive employee and keep the cheap one.

Of course, a lot has changed in the last decade since I started this blog.  Back then, unemployment was pretty high (not as high as in 1980, but high).  Today, it is at all-time lows, and many people are starting to ask why, if there is such a shortage of labor, companies are paying so little.  It is a better time to ask for a raise than, say, in 2011.

Getting back to Miss Daisy, Hoke also did his homework in another way - he understood his boss and how Booley would react.  He knew that Booley was a stern businessman, but had a soft touch for "his Momma" by the very fact of hiring Hoke years before.

Understanding your boss and his point of view is essential.  He may have department budgets to consider - and your raise may come out of his pocket (quite literally) or another employee's.  For a small company, the same is true.  Your raise (and that of others) might mean he makes less money, or he has to raise prices, or both.   And if the company isn't doing well, it doesn't matter whether you are "entitled" to a raise, if they can't afford it (and it may be time for you to move on, if the company is circling the drain).

It is a game, of course.  Payroll is often an employer's largest expense, and it creeps up over time.  So as a manager, you have to try to get an employee to work for the least amount of money possible - an amount that will prevent them from quitting or slacking off - but not so much that you are overpaying.  And oddly enough, overpaid employees can often be the least productive.   Sometimes people work harder when they are a little under pressure.

And it goes without saying that if no one is hiring in your industry - or if there are plenty of other applicants out there just waiting to take your job - then you have no leverage whatsoever.

The next part is tricky and requires some introspection.  How good are you, really?   Do you show up for work on-time and do a good job, or call in sick or are chronically late?   Do you have an special skills the company really needs, or could you be replaced with a website - or nothing at all?   It sounds dumb, but when companies lay people off, they often find they are just as productive, if not more so, than before, as it turns out having too many employees hampers production, due to social grooming and whatnot.

Like I said, it is a dicey proposition to ask for a raise.  If you don't have a pair of brass balls, you may have to rent some.  But before that, do the research first and figure out what others are paying for your job description. Having that in your back pocket as a plan B can help, but it doesn't pay to claim to have another job offer or threaten to quit if they don't pay you.

And this is where it gets tricky - very, very tricky.  No one wants to be blackmailed, and if you go to your boss and say, "give me a raise or I'll quit!" he will likely reply, "Don't let the door hit your ass on the way out!"   No one likes to be blackmailed, and a boss would rather let you go than have an employee who has leverage on him.

Besides, there is an adage among HR people that if you offer more money to an employee to keep them from quitting, they end up quitting in six months, anyway.  Think about it - you tell your boss you have a better job offer, and they pay you more money to get you to stay.  What does that say about your boss and your company?   That they are a bunch of deceitful bastards who won't pay you what you are worth, unless you have one foot out the door - that's what.

When you go to work for a company, you make a contract with them - they offer you a job at a certain price, and you accept it.   Raises are not guaranteed, other than an employer should, except in extraordinary circumstances, keep up with inflation and reward higher productivity.   That being said, labor is subject to the laws of supply-and-demand, and if there is a lot of supply out there, you can make few demands.

Ultimately, trying to improve your skills and get a promotion is the only way to really increase your salary by any significant amount.*  And often, that means having to move to another company, as often many companies do not promote from within.  I increased my salary not by "asking" for raises but through promotion and increasing my job skills (that 14 years of night school, again).  The incremental amounts I received in annual raises were pretty insignificant compared to that.

Good luck - but if it all blows up in your face, don't say I didn't warn you!

* Please don't take this as a suggestion to rack up private student loan debt in an attempt to get an "advanced degree" from a "for profit" university.  It is entirely possible that you may have risen to your level of incompetence and you may not be able to earn more money, ever.  If so, figure out how to live on what you are making, instead of chasing online degrees that are worth little and cost tens of thousands of dollars.