Salary Negotiation Tips: Turning Bonus into Salary

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Q: I've received an offer of $135K base, performance bonus potential (25%), and a $6K/year travel stipend. My ideal base salary is $140K+. If I factor in the potential bonus and available stipend, technically the offer does get to a $140K+ salary, but I would like more of the salary guaranteed going in. I like the company and do not want to adversely affect the existing offer for a few thousand dollars. Is there a negotiating strategy that will allow me to politely feel out if there is potential for any of the bonus (25%) or travel stipend to be turned into base salary?

A: All those terms are negotiable, however you need to respect the nature of a bonus: it is deliberately not guaranteed: you earn it by having great performance and helping the company to reach their goal. Therefore, asking for the bonus to be turned into salary is tantamount to saying, “Well, I don’t want this money contingent on me doing a good job—I just want the money.”

If you are going to ask, ask in a way that doesn’t give the impression that you’re not confident you’ll perform well enough to earn the bonus. When you get the offer, say something such as, “It’s a great offer.”

Make sure the offer is firm first, because it’s a sensitive area: you don’t want to be mistaken for not having confidence you can do the job or you could affect the offer you already have.

As long as you’re confident the company will deliver on its promise, it’s better to leave the bonus as is. But if you do want to try to negotiate it, say, “Thanks for the offer. When I compare it with the competition, it seems fair. I’m very confident that I’ll have the kind of performance you’re looking for to achieve the bonus. But other positions offer a little more in firm salary and a little less in contingent salary, so I’m wondering if that’s negotiable. For instance, could we add an extra $5k in salary and make up for that in bonus?”

Develop a reason that is not performance-based: “For my own cash flow needs and budgeting, it would help. Is that something that is doable?” You have to be careful you’re not sending a message that you don’t feel confident. So, if you think the money will work out roughly the same, don’t mess with it.

Next week's question: How much are benefits actually worth?

You can find more salary negotiation articles from Jack Chapman here on TheLadders, or by visiting him on the Web at www.SalaryNegotiations.com