How To Negotiate A Pay Raise: A Step-By-Step Guide


Knowing your worth and believing that you deserve such recognition is the first step to negotiating a pay raise.


Salary negotiations are never pretty. It’s always fraught with empty promises, deceptive statistics and sometimes, downright lies.

It’s a battle that we’re often not prepared for.

To combat this, I gathered a bunch of friends who handle salary negotiation for their respective company’s HR departments. These are the martyrs – the appointed bad guys who’ll do the dirty negotiation on behalf of your line manager.

Over (too many) rounds of drinks, I got these master negotiators to spill their secrets on the best way an employee can negotiate.

Here’s my ultimate step-by-step guide on how to negotiate a pay raise. Yes, you’re welcome.

Step 1: Come prepared with salary data

It’s hard to refute industry benchmarks during a negotiation. So it’s really important you know what your salary benchmark is. The awesome team at HAYS Recruitment have come to our rescue with this salary guide

NOTE: There’s also data on, etc. Those are predominantly US based sites. In my experience, their Singapore salaries aren’t very accurate.

Step 2: Come prepared with your performance data

More important than the salary data, is YOUR performance data. What are your KPIs for the last year? How does your performance compare with other people in your firm? How much revenue / profit have you brought in to the company?

Get these figures handy. Print out both your performance data and the salary benchmarks. We’ll need them later during the negotiation.

Step 3: Email boss to schedule negotiation

Here’s an email template you can use

Dear Boss,

We spoke 2 weeks ago about me contributing more the firm. I’m glad to report that I’ve hit the targets we set together on Task X. Let’s have that salary negotiation we previously agreed upon reaching this milestone.

Will Wednesday 3pm work for you?

Scheduling the negotiation sets a fair time, where both parties are mentally prepared, to discuss a pay rise. Do not combine this negotiation with any other meeting or agenda. Keep it solely for the purpose of negotiation. Don’t distract either party from the objective.

Step 4: Rehearse Questions

You can expect several standard lines management will use to negotiate down your salary:

  • We don’t have the budget for this.
  • We need to be cautious. 2016 is looking like a rocky year
  • You’re already the best paid member in the department. We can’t go higher
  • Practice all of these questions. Again, and again. You owe it to yourself to be well prepared.

(If you’re already a customer of our’s, email me and I’ll send you actual, time tested, word-for-word scripts you can use to overcome these scare bombs)

Step 5: The Negotiation

Deep breath! Exhale! Let’s do this.

During the negotiation, present your data. Start with your contributions on Task X. Then explain how you’ve compared your salary to other people in the industry. (at this point, take out those printed materials from your folder and show it to your boss)

Give your boss a few seconds to read through them. Don’t keep talking. Stay calm and let the data sink in. The better the data is understood, the stronger your negotiation position.

Now, start negotiating. State your expected salary levels. Here’s a script you can use

Well, as you can see from the data on Task X, I’ve brought in XX value to the company. That’s going to amount to XX dollars each year. I want to continue to add this value to the company and be rewarded for it.

Looking at the Hays Salary Guide, I’m on the low end of the pay range. A fair compensation would be X’XXX SGD. I would like a 500 SGD pay rise to get me to that level.

At this point, you can expect to use all your rehearsed answers from Step 4. Be strong and stay your path.

IMPORTANT: Do not make this adversarial. Keep things amicable. An angry negotiation will only work against you.

Step 6: Talk about the extra stuff

Most employees don’t realize that the payroll and benefits budget are separate. It may occasionally be the case that indeed you’re at the maximum payroll level for your position. In that case, start tapping onto the benefits budget.

Negotiate on extra stuff such as

  • Car allowance
  • Parenthood allowance (some large MNCs have this)
  • Additional days of leave (which you can encash if unused)
  • Flexible working hours

There are dozens of points you can negotiate on. Use each of these to squeeze out a good deal for yourself. It’s not just the paycheck value. These smaller benefits do add up (eg. encashing 8 days of leave at the end of the year would be worth half a month’s salary)

Step 7: Close graciously or postpone

If for whatever reason, you can’t get to the salary + benefits level you feel you deserve, do not accept the offer. Instead, negotiate new work milestones you can hit and agree to revisit the negotiation in 2 months. Also agree that if these milestones are hit, the pay raise will be backdated.

Remember that a company exists to turn a profit. The more you can contribute to this profit, the easier it is to justify your pay raise.

Should your negotiation be successful, close graciously and thank your boss. Get the agreement down in writing before you leave the meeting. (prevents management from going back on their word)

Step 8: Buy Russel Dinner

I’m kidding 😉

You’ve put in the hardwork and rightfully deserve all the spoils. Take your loved ones out to a nice meal. Share the joy.

Friends and family – that’s what life is really about. 🙂

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