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Using a new job offer to get a payrise from your existing employer.

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The art of Negotiation

It takes a lot of guts to chase a pay rise, whether it means a simple chat with your Boss or something more formal like an internal meeting or a letter to HR. With that said, how do you know when it’s time to ask for a pay rise, and when it’s simply time to find a new job instead? And can the two ever merge together successfully? 

Have you ever searched for a new job, or even filled in a full application and sent it off, in the heat of the moment because you’re irritated by something at work – or because you feel that your commitment isn’t being rewarded? The same is true for those who have asked for a pay rise and been told there isn’t the budget for it, or it’s not the right time – with more and more employees reaching for the “I’m leaving” tactic in the hopes that it might elicit a more open response to their pay rise request from an existing Boss. 

The question we are posing is this: is it right to use a potential new job as leverage to ask for a pay rise, and can it ever really result in a successful continuation of an existing role without damaging internal relations?

The act of using a new job to earn a pay rise – how does it work?

The idea of using a new job as leverage to earn a pay rise, is built on the hope that when you go to hand in your notice or hint towards a new job, your existing Boss will do everything in their power to entice you to stay. There are many employees out there who boast excellent working relationships with their Boss, some even extending into friendships – but is the assurance ever strong enough to guarantee that the tactic will go down well? 

In most cases, the grass is NOT always greener. Applying for a new job on a whim is rarely a step towards the freedom you crave, instead simply leading you sideways into a similar role where the same frustrations will arise a few months down the line when you realise that perhaps your old job wasn’t so bad after all. 

Now, we’re not saying that using a new job for a pay rise is always a bad idea, but it rarely invites the open-armed and warm reception that employees dream about when they picture the conversation with their Boss or with HR. 

What are the risks?

One of the major risks that can result from using the threat of leaving as leverage for a pay rise is that it can create a new foundation of mistrust, whereby you get what you want financially but, in the meantime, can lose the trust and sometimes the respect of superiors and peers in the workplace. 

Look at it this way. If a friend of yours threatened to cut you out unless you did something for them, would you still view them in the same way? Using a new job as leverage to earn a pay rise is essentially a threat which tells your Boss that you are willing to walk away from the role unless they agree to pay you more money. It shows a lack of loyalty and a distinct lack of respect for your Boss and their decisions. Far from showing initiative, in many cases this can ultimately be viewed as an aggressive move which creates a significant lack of respect in the future. This begs the further question, is it really worth continuing to work somewhere for a little extra money, once those damaged relationships are set in stone?

And what if it goes wrong completely? The other key risk associated with this negotiation tactic is that it might get thrown back in your face, with your Boss suggesting that you do leave and head to that new role after all. You need to be prepared to walk away should your tactic backfire.  

Is there a better way of negotiating?

In short, yes – with the following ideas creating significantly better results than the simple act of using a new job as a way of threatening your workplace into giving you more money. 

The first and most obvious action to take, especially if you have asked for a promotion or a pay rise and been told no, is to ask for feedback and ascertain if it’s budgetary and financial restrictions saying no, or if it’s more to do with your job role and performance. Find out what you can do to earn the pay rise you are asking for and showcase that you are willing to do the work in order to earn what you want – rather than simply trying to cut corners and get it through the threat of leaving. 

Another option is to be open with your Boss or with an internal HR representative, sharing your frustrations and outlining why you feel that your current salary is not sufficiently rewarding you for your work and commitment to the business. It may be a case than an internal review can provide more insight into why a pay rise is not being awarded, and it can at least make you feel better with regards to taking action and standing up for yourself. 

And then you have the solution which allows you to benefit from the best of both worlds; lining up a new job which you would be happy to step into, approaching your boss with a simple resignation rather than the implication that you would stay if there was more money on offer. This removes the careless and mindless emphasis on threat, and instead acts as a straight move which you would be happy to make – and if your Boss comes back with a counter-offer, then that’s something you can consider depending on what’s best for you.