Salary negotiation – what is your career worth?
Constant comparison of salary levels seems to be an almost obsessive pastime for lawyers at all levels, and something we get asked about frequently, says Kirsty Spears, Director at McLeod Duminy Legal Careers.
“While there are generally recognised ‘bands’ for qualifications and experience, which would suggest it is a straightforward comparison, there is no definitive source. Instead, lawyers tend to rely on recruiters, look at salary surveys or just ask their friends and colleagues.”
Ms Spears adds, however, that while the latter option can provide informal guidance, caution should be exercised. “This is perhaps not the most reliable source, because people tend to talk about what they think they should be paid, rather than what they take home.”
Using that as your justification during salary negotiations is also just about the best way to get your current employer offside, she says.
Ms Spears also points out some common mistakes when it comes to salary negotiation.
“Beware of focusing too much on information from ‘the market’, without the appropriate context. This includes the firm you are working for, the type of work you do, the targets you are set and how you are tracking against them. The market sets a guideline – which is invaluable – but understand your own circumstances and effectively make a business case for the paycheque you are after.”
Armed with that business case, your argument is strengthened. “Demonstrate your over-budget billing, proven client development, deliver the evidence for strong demand for your skills in the wider market,” she says.
For those who worry that they are missing out on fair pay, Ms Spears says that, in her experience, most people in the legal profession are compensated fairly. “There are exceptions on the high side for strong performers, for those who show leadership capabilities and are on a path to success, or for those who demonstrate specialist niche skills.”
Reflecting economic realities of supply and demand, Ms Spears adds that, in some areas where skills are readily available, downward pressure applies. “For example, private client or bulk work in bread-and-butter insurance or banking is seeing fee rates squeezed, which affects the salaries firms can afford to pay.”
Overall, Ms Spears says lawyers tend to be “pretty poor” at negotiating a better deal for themselves. “There is a call from Gen Y and millennials for more transparency in how their salaries are calculated, and that will help both ways. Firms have traditionally been quite guarded, partly because of the nature of the partnership structure, and so lawyers tend to be unaware of the cost incurred to sit at a desk every day, regardless of the fees they make.”
She has some words of caution for those chasing the money: “Being paid very well sounds great, but it can be a problem when you are looking to move, because it may price you out of a great career move. We know there are firms that are banking on just that when looking at their salaries for top performers.”
And Ms Spears points out that, in any case, it is not all about the money. New Zealand’s pay rates tend to lag behind those of Australia, and remuneration in the regions is lower than the cities.
“We often have to point out that you do not come to New Zealand to seek your fortune. Instead, there is lifestyle appeal – if more money is not possible, negotiate something else of value to you. That could include working from home, flexible hours, time for pro bono work. After all, your work should contribute to overall happiness, not detract from it.”