Okay I must admit that I totally suck when it comes to negotiating salary. Twice before I have been tricked into a low salary and complex salary structure. As a normal job hungry guy, I would quote a CTC and I was almost always fooled. (PS: For the sake of my self esteem, I must tell you that till date 14 companies have offered me a job at various positions. I’m in my fourth job right now…anyway). I never knew that HR guys are smart enough to add Employers contribution of PF to the salary. Whoa! Good thinking, which actually ends up reducing my salary. There are many such things, and you actually end up earning almost 25-30% lesser salary than what you anticipate.
So since I have enough experience of handling (read tumbling into) such situations, let me give you some tips.
- Read the document first. Check the components, there must be a basic salary, HR, Medical and other allowances such as telephone, vehicle, etc. Ask the HR which are all reimbursable and how do you do that (its normally by submitting bills).
- Most of the companies allow you to decide the break up, so ask for this. In case you are confident of producing bills, ask them to keep your basic salary to the minimum for your post and increase the billable allowances (Mobile, HR, Vehicle etc.). Do the vice versa if you can’t produce bills.
- Opt for food coupons. They are good.
- Most of us are not aware that taking PF is not compulsory. You can opt out of it is you have other better investment instruments (ELSS funds, Fixed deposits, PPF, Interest on home+education loans etc.)
- LTA is not compulsory too, but as most of us travel to a distant location at least once a year, leave it as it is.
- Make sure you keep the variable component to minimum. Also ask a procedure for disbursement of such amount, cross check with some one you know in the company.
- DO NOT fall prey to assured bonuses and service agreements (bond). I would say a firm no. By the way these bonds are one sided. They can only take you to the arbitrator. You can not be sued or jailed. No one can even force you to pay the money too.
- Most important: If you think you are worth X, quote X+3 and negotiate hard so that you get at least X+1. Always look for 50% rise, so that even if it comes down by half, you have a good bet.
I have fallen prey to every thing above. So now a days I have started asking the net take home component of the salary. Sadly, people think I ask too much 😀