There is a lot of advice available when it comes to negotiating a salary, but what about a cost of living adjustment? Many employees continue to work within an organization without regular raises or renegotiations of their base pay. However, often the cost of living necessitates a change in compensation. For example, if you were to relocate to another city to perform the same job your duties may be identical but housing, commute, and other necessities could cost more than your previous location. Here are some tips for negotiating a cost of living adjustment with your employer.
- Compensation philosophy. The most important thing to understand before you begin your discussions is your company’s compensation philosophy. They may already intend on providing you with a cost of living raise that is comparable to the salaries in the city to which you are being relocated. If so, you may not even have to worry about asking for an adjustment. If you are not relocating but find it difficult to keep up with your bills since your last increase you may also need to have an exploratory conversation with your human resources department to determine what they are willing to offer.
- Get it in writing. Regardless of the outcome of the conversation it is extremely important to make sure you get everything offered in writing. To protect yourself you need to have documentation of your discussion so you can refer to their answers with anyone else who may be responsible for the decision making process. Once you’ve had the initial conversation ask for a copy of the policy and a letter describing your agreement. Hold them to providing this for you.
- Bring your homework to the table. Once you enter official negotiations you should definitely be prepared before sitting down for the discussion. Research salaries in your area or the new city and be able to present them with confidence. Also be sure to track any information such as rent or home prices, the cost of utilities, the taxes, and the cost of essential items like groceries and gas. Knowing this information will help you determine if the increase in compensation will be worth it for your career long term.
- Discuss relocation costs. If the change in salary is due to a company initiated relocation it is also necessary to look at the costs of the move. How much is the organization willing to pay for to move you to their new location? You will also need to know additional information such as selling a current home or the availability of housing in the new area. Some organizations foot the bill for every aspect of the move, including temporary housing. Others will pay a lump sum and you will be responsible for your own arrangements. Determine what is worth it for you to make a change. A raise in cost of living will be ineffective if you’re unable to pay for the move.
Are you looking for more practical salary negotiation advice? Contact the Ft Worth recruiters at Three Pillar staffing to learn more!