Expert advice: how to prepare for the annual salary negotiation

If you want a higher salary, it requires thorough preparation. You must be able to show how your work creates value for the employer and dare to stand firm on your demands during the negotiation, says Anders Thrane Niebuhr, Head of Negotiations at IDA.

Whether you're facing a regular annual salary review or have asked for a salary interview yourself, you can increase your chances of getting a rise by preparing thoroughly.

Here you'll find the tools to calculate your market value and find strong arguments to support your case for a higher salary.

Check how much you should be paid

As an IDA member, you have access to several salary tools. They are based on salary information provided by IDA members and are updated every year. Use these to get an overview of what others with your education, in your sector, and with your seniority earn.

This will give you a good idea of what you are worth, and if you are currently below the average salary, you will have a strong argument at your next salary negotiation for why you should get a rise.

For the most accurate results, combine all the salary tools, as they have different strengths and weaknesses. IDA recommends that you choose the highest result as the basis for your proposal for the salary negotiation.

Be ambitious and realistic in your salary proposal

To start off a little higher than your target can be a useful strategy. Then your manager will try to negotiate your offer down, and you will find a place to meet. That's why you need to be ambitious, so you have something to negotiate with and so you show that you believe in yourself. For your salary negotiation, it's best to be specific and ask for a total monthly salary of DKK 55,000, for example, rather than a salary "somewhere in the mid-fifties".

In addition to using IDA's salary tools, it's a good idea to talk to your colleagues and friends about what is a realistic salary level in your company. For example, you can't expect to get a big pay rise if your company has just been through a round of redundancies or if the total pay pool is DKK 10,000.

IDA Salary Statistics: Check your salary

Use IDA's Salary Statistics to see what IDA members with different types of positions, seniority and educational backgrounds earn. Use the tool to be well prepared for your next salary negotiation.

Log in and compare salary levels

Prepare your arguments for the salary negotiation

You can't expect your manager to have a full overview of your work and stand ready with an offer of a higher salary. Therefore, you should prepare your arguments thoroughly before the salary negotiation. It's a good idea to write down all your successes and tasks over the past year so you don't forget anything.

Then, remember to align your successes with the company's goals, so you don't focus too narrowly on your own tasks. For example, did you deliver an effort that made a sale possible? Or did you contribute specific knowledge that was not otherwise available in your organisation? Have you taken further training that has enabled you to tackle new types of tasks or take on greater responsibility? Use concrete examples to argue why you deserve a pay rise.

Examples of good arguments for your salary negotiation are:

  • That you have contributed to achieving the organisation's goals
  • That you have taken on more responsibility
  • That you have been given new tasks
  • That you have been given management responsibility
  • That you have optimised processes or saved money and resources for the company
  • That your salary does not correspond to your market value

Don't talk about your colleagues' pay

IDA's salary tools allow you to compare yourself with others who have the same professional profile. It is a legitimate argument in your salary negotiations that your salary is low compared to the average in your sector, but you do not have to compare yourself with your colleagues.

It's tempting to say that Rikke on the third floor gets DKK 5,000 more a month than you, even if you think your performance is better, but it doesn't pay to put others down. Your arguments should always be about your own performance, because most managers won't go in and discuss other employees' performance and pay levels anyway.

Stand firm on your wishes at the salary negotiation

If you have asked for a salary negotiation, you should make sure you get your wishes across early in the conversation. Otherwise, you risk it becoming a general chat about your tasks and skills rather than a real salary negotiation.

A good approach is to first highlight why you are happy in your job and then start your arguments for why you should get a pay rise, e.g. "I enjoy my work and colleagues, but it's been two years since my pay rise and in the meantime I've gotten more responsibility".

If you are going to your regular annual salary negotiation, you can let your manager make a proposal first. If you're happy with it, just say yes, but otherwise be prepared to argue why your pay should be higher. One possible scenario is that your manager will try to bid lower and you'll have to pull the other way.

So don't worry about coming across as greedy, as long as you keep a good tone and have prepared your arguments. It would be a shame to accept a lower offer than your manager is actually prepared to give you.

Find alternatives to a salary increase

It's a good idea to prepare alternative wishes in advance, in case you can't get a higher pay. For example, you could negotiate for holidays, free phone calls, free parking, a newspaper or other benefits.

It may be easier to get your training paid for as an alternative to a pay rise, because you can argue that it gives you new skills that your employer will benefit from. Performance pay or a bonus may also be easier to get through, because your employer only has to pay you once you have delivered a certain result.

Read more about what you can negotiate as an alternative to a pay rise (In Danish)

Be constructive if you don't get a pay rise

Didn't get the raise you dreamed of? No matter how disappointed you are with the outcome of your salary negotiation, keep it cool and be constructive.

It is no use blaming the manager or using overly negative body language, as this can create a bad atmosphere afterwards.

In turn, ask how you will qualify for the next salary negotiation. What do you need to do more of or less of? In addition, you should end the conversation by making a concrete agreement about when you will negotiate salary next time. It may be that you can have your next pay negotiation scheduled earlier, now that you could not get a pay rise this time.

Be ready to change jobs to increase your salary

If you have difficulty getting salary increases that match your market value, you may need to change jobs to increase your salary. IDA has conducted several studies showing that when changing jobs, it is realistic to expect a salary increase for the vast majority. This is particularly true if you are relatively new to the labour market, while the trend is slightly weaker in the later years of your working life.

When you are negotiating your salary at your new job, the same advice given earlier on this page applies. Your arguments should be based on how you can add value to the employer and you should have researched the finances beforehand so that you can make a realistic offer. If you are negotiating a salary with a new employer, it is a good idea to let them make the first offer so that you don't end up asking for less than they would have proposed.