There have been multiple articles written about low salary and comparing it to the demand of work. The effort required to do the job usually is not compensated by the pay the person receives. This usually affects those at the bottom of the corporate ladder even if during performance review meetings, they are hailed to be the core people who make the company thrive and successful.
Another topic revolving around low salary is during the hiring stages when a person is moving from one company to another. When a person is being recruited, what usually happens is that the company hiring the person asks for the person’s payslip to know what is his/her current pay. From this, the hiring company will offer a little bit more to get the person to sign up, even if the average market value for the position is more than the offer. Or, the hiring company has a budget to pay more.
Additionally, new graduates fall prey on this too. Since they do not have any experience coming out of school, the offer that companies give are usually the bare minimum. Maybe with some added benefits, sure. However, most of the time, it is just enough to meet the government’s requirement of minimum wage. What is worse is that there are companies who would offer below minimum and the person could not refuse as he/she needs the job.
In these three scenarios, how could one get paid what he/she deserves? Is there a risk in negotiating? How does this impact future pay of a person? But first, how would one know if the pay is lower than what he/she deserves relative to the work?
Is the salary fair for the work
First off, we all need to know how much is the prevailing rate for the work we are to do. This includes the complexity, the responsibility, the hours, the industry, the location, and ultimately the position. Knowing all of these and the current market value would help us assess if our current pay is fair and enough.
In one city in the Philippines, the company I worked for had a site there. The cost of living there is about 50% lower compared to the capital city of Manila. Therefore, based on this, the wages of our employees working there is far lower than our employees working in our site in the capital city.
However, the work demand is the same. The stress is the same. The pressure is the same. This created a little bit of animosity between people from the two sites as salaries and lives were compared. Imagine doing the work the same as your colleague and being pay less. Of course, the simple explanation is that the need of the cost of living is lower compared to the capital city but then again, the argument is that the effort is the same.
Is the salary according to current market rate
Aside from the difference of the cost of living between the two locations, the industry rate is different too although not far from each other. The prevailing rate in the capital city was only about 20% higher than the the other city for the same work.
Salary alignment usually happens every five years. This is done primarily to compensate for the rate of inflation. Without reviewing the current salary packages and benefits, wage earners are at a disadvantage as the demand only goes up while the salary remains the same.
This creates a delay in matching the salary to the prevailing rates as inflation changes every year. By the time the alignment happens, the person with the low salary may have not been compensated enough for a couple of years.
Is the salary enough to support the family
We all work to earn. Our earnings are to support ourselves and our loved ones. We work to provide and create a better and more comfortable life for us and the people around us. Therefore, if our salary is not enough to do that, it leads to frustration and stress.
While most of us take what is offered especially if we are out of a job and trying to get one, we do not consider this anymore. We just have to get by. We accept the job and figure out the rest along the way. This may work for the short term, however, once a couple of years have passed, it becomes a roadblock for us to enjoy life.
Knowing these three things helps us better gauge if the pay is enough. Note that I did not mention talent and skills because what we are trying to understand is whether the salary is enough. Talent and skills will determine how far will you be from the average. If you are the best in the field, at least perform better than the rest, or have potential to do great things then, of course you should be getting more than the average.
Paid what you are worth
Knowing these three things will help you look for the most suitable work for you according to pay in your line of career. By understanding the prevailing rate and your needs would help you better make a decision in choosing a job offer.
This also applies if you are a current employee and looking to get paid higher. Most of the time, getting a salary boost only happens during annual appraisal if the company offers it and promotion. Usually, the latter will just give you the bare minimum for that position which is what you could compare to the prevailing rate.
A caution reminder. There are companies that offer higher salary packages just to get you to sign up. For this, do not take it as it is. If it is too good to be true, then it must be. A lot of people who got blinded by the money lost their jobs after a couple of months as they did not do due diligence on the company they joined.
Personally, I waited for my salary to go up. I just did what I could to the best of my knowledge and abilities and eventually, I got paid more than the average rate. There are some who would jump from one company to another every 2 years to get a salary bump without promotion but this is not 100% effective. They got stuck at their levels with a high salary and no one will accept them anymore. This means that along the way, building knowledge and skills is imperative to climb up and get a higher pay.
In summary, you can negotiate. Use the prevailing rate and assess your needs. Do not get paid less than what the work demands from you. That is just not fair. And while you are at the job, continue building your skills. This is when you wait. The time will come when you get paid more than what you are worth.
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