The Ultimate Guide to Making Money

Why you shouldn’t reveal your salary history in a negotiation

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Two days ago, I saw a post on the New York Times’ personal-finance blog, Bucks, where a woman recommended lying about your salary history in an interview.

Now, I’ve taught thousands of people how to negotiate, but lying is something that only amateurs do. They lie because they don’t realize there are other, more powerful levers to pull — without the huge risk of getting caught in a lie. As for their ethics, I’m not even going to comment on it except to say I wouldn’t do it.

So I jotted off a quick note to the New York Times about a better way to negotiate, including the scripts for what people should say if they’re asked about their salary history.

Less than 24 hours later, I had spoken to a NYT reporter and my responses were posted on their blog.

Read it here: On Refusing to Disclose Your Salary in a Job Interview

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54 Comments

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  1. Boom. Good job.

  2. Ramit -

    You are completely right – there is NO reason to lie. People are afraid that if they don’t give a ‘number’ they won’t get offered a job. I say bullshit. Since I realized that giving away salary information was a losing proposition, I haven’t done it at all, and you know what? I still get offered the jobs.

    Keep it up!

    Keith

  3. You should do a webinar with Penelope Trunk about salary negotiations.

  4. Three of the last four jobs I’ve had have been through my network. Everyone that hired me away knew the ballpark of what I was making already. Every time I was offered 1.5 times or more than what I was making before to make the move to work with them. What I was previously making isn’t an issue in those situations. It’s just damn hard to find somebody really good these days.

  5. This is such a tricky topic I always get uncomfortable whenever the subject comes up.

  6. When I am interviewing candidates I always want to know their prior salary because it is to MY advantage to have that information when determining what salary to offer them. I can offer a reasonable increase and feel confident the offer will be accepted. Thus, by providing the salary history, the candidate effectively caps the salary he’ll receive. Withholding that information could dramatically increase the offer.

    Also, while it seems like a risky strategy for an job applicant, I’d be impressed by it. It would show him to be an effective and shrewd negotiator, someone I’d want in my company.

  7. My brother got himself a trophy wife, apparently not first place

  8. This makes so much sense and I’m surprised that more people don’t realize this…

  9. I love how Ramit always declares things as fact without backing it up with evidence, or in this case, even with argument. What is the huge “risk” in representing yourself well? 20% chance they adequately background check? In that case, I lost out on a mediocre offer. It reality, negotiations are a poker match in which both sides are bluffing the other. Silence is not enough; you need to “represent” a hand. After receiving my current job offer, I learned it was company policy to offer exactly X percent above the current salary of a desired employee. My number was inflated already, boy I wish I had given an even higher number! Pull ALL the levers you can friends!

  10. Jeff, am I reading you right? You’re saying there’s not a risk in lying about your salary history? I didn’t think that needed elaboration, but maybe I was wrong.

    The point is, first, lying about your salary history is unethical, not “representing yourself well.” Second, it’s stupid. If they ever find out — even 5 years later — you can be fired. Third, it’s lazy. Stop depending on the crutch of deceit and learn how to negotiate well. That way, you can tell the truth and still completely dominate.

    Please let me know if I misread your comment, because I just can’t believe I read it right.

  11. I think it’s unclear that refusing to disclose your salary history outright–or even negotiating–is less damaging to your chances than lying. As illustrated by the HR professional in the article above who considers candidates who don’t readily disclose their salaries ‘a waste of his time’.

    And as regards the ethics … it’s not something I would do, personally, but we’re talking about dealing with corporate HR people, here.

    This really is an assertion that needs evidence to back it up, not merely an appeal to authority.

  12. I looked at the NYT blog. And I agree, (when I was an employee) if they wanted a number it’s was an after comp range I’d be looking at. Because, I wanted to know after vacation, retirement plans, health care, taxes, etc. what I am going to net. I wasn’t negotiating salary, I was negotiating everything as a package. And on those lines one’s previous salary is meaningless without a discussion of everything else.

  13. It is unrealistic to think you shouldn’t or won’t have to reveal your salary. I also think recruiters realize it’s unrealistic for them to assume they are getting an honest answer as well… And don’t worry, Human Resources can’t reveal salary information.

    It’s most important to be self-aware. You need to know what number it takes for your to work/switch/etc. So although it’s 100% lying, I think the number that you reveal needs to reflect ‘what you cost’ – not where you are currently at… If you are currently happily employed and a recruiter calls, your number will be higher, and vice versa.

  14. Ramit,

    My question relates to salary negotiation, but from a different perspective – how to effectively negotiate an increase in salary which you feel effectively mirrors your personal worth, valuing yourself in accordance with your market value/university peer comparison/effectiveness in achieving prior results BUT in a new role within your present company.

    Let me attempt to briefly explain the situation:

    I am already 7-8 weeks into working in a new role in my organisation – the launch and then upkeep of an online project which ties into the top 3 strategic objectives of the company’s Senior Execs (i.e. supposedly high profile) – and yet, although I am already effectively doing the job, the ‘powers that be’ have still not agreed on the number they’re going to value me at (weak negotiating position no.1).

    Prior to being asked to do the new (higher profile, higher risk) role, I had been dissatisfied with the previous role/management and actually ultimately the company, and had been starting to make moves to leave.

    However, I was then asked to launch this site, and saw it as being something substantial that I could get my teeth into. In my initial conversation with the new boss, I requested the ‘number’, as per JW’s comment above, that I would el valued at. I was almost immediately be informed that was unlikely to be granted – possibly based on 1-3% salary raise rule, although this is an entirely new role..

    I’m frustrated for a number of reasons, not least because I now feel like I’ve been swept along in a situation that is out of my control, but mainly also because I suspect I’ve not negotiated as effectively as I should have done to achieve my own personal demands – it is possible more senior management involvement required, in a company like this. I felt, but perhaps was wrong, that I had no choice but to start working on the project without the necessary prior conclusion about my role/salary, and I have now nearly completed the site which will be launched in 10 days time. I have been told that there will be a conversation today with my manager which will relay the HR team’s conclusion to me – I’ve no doubt that it’s the perfect excuse for him to abdicate all personal responsibility for the decision.

    My question is therefore, how could I have possibly better negotiated a completely new role in a company which already knows my (inadequate) salary, i.e. without the strength of position that you mention where you are approaching an entirely new, fresh company?

    AP

  15. The only problem with what this article suggests is that it’s a bit of a rapport killer.

    If you’re in an interview with somebody, things are going well, you’ve certainly developed rapport, and then he/she casually asks what you’re currently making, to roll off a political, vague answer like you suggest might make you seem like more of a phony. I have a hard time picturing myself saying something like that to someone who I’ve developed legitimate rapport with.

    I agree that lieing is wrong, and I agree (for the most part) about trying to conceal your salary as best as possible, but the examples in the NYT seem a little too canned.

    Any thoughts on disclosing a range? IE, if you made $60K at your old job, you could say that you made in the “$60K – $75K” range, and you’re comfortable staying there.

  16. I agree with single mom rich mom. It is very hard to find talent these days, especially with a new generation that feels a sense of entitlement. If the talent, work ethic, and proven track record are there, the rest will take care of itself.

  17. Recruiter - Headhunter Link to this comment

    Make it easier for me to pay you less than what you’re worth by revealing your salary history and compensation expectations.

  18. Glad you answered the question about putting your salary in online engines. While I’ve never received a job offer from filling out applications on Taleo/Careerbuilder, I’ve had some success finding freelance clients through those sites. They require a numerical entry into the “Salary” field, so writing N/A is out. Total comp, though…that’s a good alternative. Thanks!

  19. The only way to deal with an HR person who asks what your salary was is to turn it around and say “what is the range of salary for this position?” That way you can base the rest of the interview around what they expect to pay. Out of your range (low side) you may be able to convice them to pay you more, but nowadays that’s very unlikely. Out of your range (on the high side) you are golden.

    If they start making excuses such as “The pay range depends upon experience” (or skills) or if the range is greater than $20k, that’s a huge red flag.

  20. Hi Ramit,
    Thanks – will do this weekend – sadly I didn’t bring my copy into work, otherwise Chapter 9 might well have helped in my later conversation! Still, a learning point for later.
    Cheers,
    Alexia

  21. sweet! congrats man

  22. Some employment applications I’ve filled out have an employment history and starting salary and final salary of each position that you’ve held.

    Of course, I could not leave it blank, but then my application might just be thrown into the trash.

    What would you do when they ask you for your salary history on the employment application?

    Thanks.
    Jason

  23. Great advice Ramit! When you start a relationship with lying it can only go down from there.

  24. Here are some thoughts:

    1. People looking at their first job straight out of college shouldn’t be negotiating too hard for a higher salary. If you get multiple offers from different employers, then you have some leverage. But otherwise, you have no track record.

    2. Someone suggested it’s safe to tell a recruiter/headhunter your salary history, but that’s wrong. I told my recruiter specifically that he should not reveal my salary history. When I was a given the job offer, the HR person made the mistake of saying, “you should be happy becuase that’s 13% more than your current salary!” I asked how she found out my current salary and she said she found out from the recruiter. Turns out that the information was provided by the recruiter’s partner. Never forget, the client is the one paying the bills, and that isn’t you. I won’t be working with this recruiter any more.
    3. Never lie about anything in the process.
    4. If you don’t know how much people are paid in the position you’re interviewing for, you haven’t done enough preparation.

    Here’s an e-mail trail of a recent communication I had with a recruiter:

    Dear joewatch

    Would you kindly forward your CV so that I have a better understanding of your background as I review opportunities and pass on anything viable…..much appreciated.

    Best Regards,

    XXX
    Executive Talent Partner

    CV forwarded by me

    Thank you for the CV…much appreciated. What is your current salary…so I know what level of role and company to look at. Thank you.

    Regards,

    XXX
    Executive Talent Partner

    Dear xxx,
    I don’t like to reveal my salary as I believe that it sets up too much bias in the interview process.

    Regards,
    joewatch


    Dear joewatch,

    The problem is no HR dept will consider a candidate without comp details…I can’t match roles unless the roles comp is in line with your needs.

    XXX
    Executive Talent Partner


    Dear xxx,

    I understand that makes your job harder. If there is a position that fits with my experience, qualifications, and interest, please let me know what the expected compensation is, and I will let you know if it is in line with my needs.

    Thanks,
    joewatch

    ok…I have a XXX position at the Associate Director grade level with company XXX…with a salary of $145k to $155k and 15% bonus.

    XXX
    Executive Talent Partner

    That’s how it’s done!

    Good luck,
    joewatch

    • Excellent example! People often take the easy way out and repeating the past (past salary as baseline) is the easy way out. Moving the discussion off the calculator makes it messier and more real.

  25. Great article. Yes, lying is unethical and very risky. Also, inflating your salary too much could knock you out of the running if they don’t think they could afford you. Another problem is I can almost guarantee that if you need to lie about your salary that you’re also the type that will not be able to establish why your worth the extra value. Negotiating a salary is more about establishing the extra value then just asking for more money. It’s best to concentrate on developing an image of huge value in the employers mind and seeing what they feel your worth. You can always turn down an offer if it’s less than you expect.

  26. I am a HR executive for a big corporation. Lying about your salary is bad and is seen in a bad light. What else are you lying about? We always ask for references and we confirm not just performance, but salary and other benefits. If you are in an interview, you need to sell yourself and your abilities by refering to successful projects or achievements.
    Business do not just pay salaries, because you are an accountant. We look at what extra value you can create for the business and what other skills you have or networks.

  27. I always inflate my previous salary amount. That is how i tripled my salary. I call it climbing the corporate ladder without sleeping your way to the top. However, in retrospect, after reading this article I might do things differently in the future. Thanks for a great article that makes sense and an a great eye opener.

  28. Illegal??:

    “We’ve heard from a number of HR executives in the DailyWorth community that even slight salary history inflations are illegal and could jeopardize your job application, and to that extent, we will be retracting this post completely.”

  29. Ramit, that is horrible advice. You dont want to sound like a prick about your salary. This shouldnt be a sticking point where you piss off people trying to help you get a job or employers. I would recommend asking the employer what is the salary range of this position and say I fall into this area as well without getting into specifics. And recruiters are trying to help.

  30. Who said anything about being a “prick” or “pissing off people”? It sounds like your assumptions are replacing what I actually said.

  31. It’s okay for an interviewee to try to deflect the question, or put the ball “back in their court.” Just remember, these tactics don’t always work, so it’s important for a candidate to determine how far they are willing to push the matter, especially for a desirable job opening. I have interviewed dozens of candidates for sales positions over the last few years. Not one applicant makes it past square one without providing proof of their compensation via two years W-2′s. Those that are unwilling to do so will not get a second look from me, no exceptions. Just remember, if you really want the job, you may have to be the one that blinks first.

  32. How many salary negotiations have you done for your own employment Ramit?

    • Many. I’ve also coached many others through negotiations, resulting in tens of thousands of dollars of increased salaries, and co-authored a book on college recruiting.

  33. I agree. There is not a reason to lie. Being honest is a big plus when you are looking for a job.

  34. @Chad

    2 years of W-2, wow i would not want to work for you. I think for a employer-employee relationship to work there has to be some trust on both sides. I think this is a bit invasive. A W-2 has a lot of other information such as 401K contributions, transportation benefits, health care contributions, bonuses and overtime that frankly is not the business of the potential employer. I think it is best to research what comparable positions pay and give the employer a range.

  35. I find the comments on the NYT articles fascinating. Check this out:

    “…I can recall only one instance in a face to face meeting that a candidate declined to give comp specifics. I explained we couldn’t proceed without, to no avail, and left since he was not at the level of sophistication required for the position in question.” – SD

    As if surrendering your negotiating advantage is “sophisticated.” let’s turn the tables. Why isn’t this recruiter sophisticated enough to disclose the highest salary they can offer?

    Another one:

    “If you make them guess, and they guess wrong, the embarrassment (on both sides) can too easily kill the deal.” – John Borrowman

    My translation: please tell us your salary history so I don’t actually have to research what a competitive salary would be.

    I don’t see how embarrassment could kill a deal; if you’re tough enough to say no to salary history, I think you can stand a low-ball offer. John claims that companies will use your salary history for your own good, but I call that claim a pile of horse manure.

    “The main reason we ask what your current salary is right away is that we do not want to waste your time, our time, or our hiring manager’s time.” – Recruiter

    Again, reversing the preference: why doesn’t the recruiter immediately disclose the salary range if the candidate doesn’t disclose his history? My theory: because saving time is not their highest priority.

    I believe these companies and recruiters communicate their priorities with their actions, not their words. The only use for salary history is to help determine how much they want to offer a candidate. If they let the issue of salary history end negotiations, then their real priority is either minimizing compensation, or demonstrating power over the candidate.

    I believe that the recruiting process is the foundation of a company’s culture. If the recruiters are looking for bargain basement candidates, then the company will be full of employees picked from the clearance racks. If the candidates already have to obey a bunch of silly rules just to make it through the recruiting process, the company will be full of subservient employees who aren’t independent or creative. If the recruiters get bent out of shape over salary history, what does that say about how you’ll like your future work environment?

    If you’re an outstanding candidate, you shouldn’t have to give in to the “rules are rules” mentality, or have to show your hand in negotiations. If the company refuses to deal with you for not disclosing your salary, I’d argue that the company probably isn’t good enough for you. Outstanding employees deserve outstanding employers. An outstanding employer would would try to make a good first offer even if they didn’t have access to salary history, and if it wasn’t agreeable would continue the negotiation process with that new data.

    If you’re not an outstanding candidate, then you might be forced to disclose your salary history to get a job. But probably not. I don’t disclose my salary history, and I think Silicon Labs was the only interviewer to make a big deal about it. It’s not like the HR guys at the other companies had to go back to the hiring manager to check if I was an outstanding candidate deserving of a salary history waiver. SiLabs didn’t make me an offer, and by that point I agreed that we weren’t a good match. If salary history was the issue on their side, I’m glad for it. It saved me a lot of headache.

  36. It’s great to be able to negotiate but with so many people out of work employers are looking for people that would have been thought to have been “overqualified” before at entry level rates. When it comes down to it, some employers will offer the lowest that they can get away with no matter what you do.

  37. Ramit, I still am waiting for a clear response to the questions raised in the comments to the NYT article… how do you fill in the salary field in an online application that requires a numeric response? If you can’t get into the Applicant Tracking System, you’ll never get an interview.

    • You can put 0 or another similar number. The larger issue is what most people don’t like hearing: The best jobs are not found through an “Applicant Tracking System,” and the best candidates have already made contacts at the company before ever applying. Again, this isn’t true of all jobs — just the non-cookie-cutter ones where you have the most power to negotiate.

  38. You’re right on all counts, Ramit, and I am getting more and more contacts using more advanced methods. But those of us drawing unemployment still have to make at least three applications or job contacts a week, and sometimes that means applying through an Applicant Tracking System.

  39. Ugh, I am having this exact dilemma with salary negotiations. A few weeks ago, a woman contacted me about what I would charge for contract/project work, and I told her it really depended on the specifications of the project and what she needed done. She never gave up the details, insisting I give her a number. Finally, after a series of emails, I did come up with a number. Following that, she continued to send me emails, nitpicking things in my resume that would possibly lead me to concede on my price. I told her we could talk about it in an interview since the conversation was not appropriate for email alone, and I never heard from her again. Blessing in disguise, I guess, because I didn’t think she was ready to pay for what she wanted, and didn’t want to reveal exactly what the goals of her ‘projects’ were. I bet her ‘projects’ were things like picking up her laundry, having me file her toenails, and fanning her with palm fronds, which would all be okay if I we were going to work on a cruise ship (haha, that is a joke people).

    Yesterday, I was in a getting-to-know-you interview with the newest member at a firm that I have been talking to since December. The newest managing partner, a fund manager with ‘an excellent track record’ (not my words), casually asked my about my salary requirements after about 30 min of convo, so I didn’t tell him anything but I asked him if he was making me a formal offer. He was vague about that. Then I asked him what his timeframe for hiring was, he said “Sooner rather than later”. Okay, another non-answer. I asked him if he was interviewing anyone else, he said “No.” I asked him what the job specs were, and he said, “to help out Amanda with all the things she’s doing” (names have been changed). ANOTHER non-answer. I asked him if he had an idea of what he’d value a position like this, and he said he didn’t know. Coming from a fund manager, that is a HIGHLY fishy answer. I did ask him what his goals were for 3 months, 6 months, and a year out, and he was able to confidently answer that, so I pulled out the facts from his answer and did a reverse timeline in my head, with approx numbers for what his new clients would be worth, monthly. He said he didn’t have the clients in hand, so he couldn’t say what his range would be. I was thinking, “Then why the hell do you get up in the morning? To not get clients or to not make projections?” I then (politely) told him that there is a definite market for this skill set, so it would take a 5 min Google search to find the range. So, I have stalled for time, so far. On my way out of the office, I asked another person if they have interviewed other people, and she said they had, but those people were outside of their price range. Hmm, I’m feeling like the cheap choice already. It’s a 4 person office right now, and I have a chance to “get in on the ground floor of an amazing, blah blah blah”. All I really care about is whether the price is right.

    Anyway, I have successfully stalled for time in this scenario, but they have asked me for salary history. I live far from the company and would like to have another talk with them in person. I have sent them a sample job description with sample duties and goals, sans comp numbers. I have asked them about the total comp package. Nothing yet. The people at this firm have a flexible work culture, casual dress, and they’re pretty smart, so it would be cool to work there, but all this bluffing is driving me crazy and I don’t know what to do next. Anyone have any thoughts? I’d really like my duties outlined (just so I have a framework). I feel like they’re freaking because I can see them imagining a person sitting behind her desk filing her nails and saying, “Sorry, I can’t do that, not in my job description!” But, I can’t NOT have some mutual understanding of what I’ll be expected to do, otherwise I’ll just become a slave when the duties and demands keep escalating, with the bar of performance always being raised, making it impossible for me to justify a raise.

  40. Chad, you sound like a complete prat. And that’s putting it mildly. I would rather poke my eyes out with a hot poker than work for you. Do you even honestly believe your “I have all the power” system is delivering you the best workers? Trust me, it’s not. But you’re obviously happy with the desperate people who have to take a job, any job, and are prepared to put up with your crap until they can find something better. Imagine having to come to work every day and deal with someone like you! Boy, you really are a piece of work.

  41. @Chad
    Wow. How desperate does someone have to be to work for a company like that? I *might* consider submitting some financial information like that as part of a background check if my finances were potentially relevant to my job performance (i.e. I was being given a large degree of trust w/ client’s money), but I certainly would never submit information like that before you’d even offered me the job!

  42. I will say though, if you are working with an executive recruiter, I don’t see why you would withhold that information. I work for an executive recruiting firm, and our final fee is determined by how much the employer offers to pay you – ie, the more you make, the more we make. It is in OUR best interest to convince the employer to pay you more. So if you are at the executive level and dealing with a retained recruiting firm, I wouldn’t hesitate to give this information out – also including benefit information and other circumstances, like relocation expenses or the fact that raises or bonuses have been put on hold at your current company due to the economy, or if your spouse would be leaving their job to follow you in the new position – all things that we take under consideration. We also usually ask what salary expectations are, and if someone asks, even early on in the process, we will tell them the salary range. We also tend to work in the nonprofit industry, where most executive salaries are public knowledge or can be obtained very easily, so lying would be a VERY bad idea!

  43. I actually like the salary question. If you have done your homework you should know what the salary will be for the position, within 10%. I make a good salary and am happy at my job,and for me to work for another company would take a 20+% premium over my current salary, which I communicate to recruiters and hiring managers.

    Most hiring managers and recruiters will have an idea of what you are making, but will want to confirm. By not divulging salary information, you could be adding unwanted attention to your application and coming off as entitled. Being confident in what you make and what you deserve would be seen as a strength in my opinion, compared to another applicant that dodged the question or changed the topic.

    And if they ask me my salary requirements, and say for instance it happens to be $140K, and my research is inline with that, I will give a range of $135k to $160K. Gives me room to negotiate.

    Ramit, would like your feedback on this. Good discussion, thanks!

  44. I was wondering…do you have any tips for negotiating a better benefits package in the non-profit industry?

    Non-profit salaries are very often limited by grant funding, and they can be cut, reshuffled, or even dissapear entirely in a heartbeat. As a matter of fact, the hiring person at my last few interviews has been explicit with saying “We do NOT negotiate salaries,” which I imagine they started doing because a lot of profit-world people are sliding over to the non-profit world during the recession.

    Short of leaving the non-profit world all together (which is what all my for-profit recommend, but I don’t want to do), how can non-profit workers negotiate for better benefits?

  45. There is only one reason why I would go along with Submitting my W-2′s to a company like Chads. He was hiring for Sales Positions. I will assume that these sales positions are based on commission. A great salesman has proof of their work in the paychecks/W-2′s. Low W-2′s/paycheck, no sales were being made. Quite simple.

  46. Interesting comments. Believe it or not, our employees are not coming to us out of “desperation.” Our positions are actually very desirable and I’m fortunate to have a talented and dedicated sales force.

    With respects to the W-2′s, subester is on the right track, but there’s actually more to it. My sales openings are hybrid base + commission positions. Our goal is that any new employee should be realistically be capable of earning 30-40% more in their first year they did at their prior employer. However, their additional revenue needs to be performance based (i.e. all commission driven). Setting an appropriate base is crucial to this goal. There needen’t be any acrimony or suspicion in the salary negotiations. If an employee is good, he or she WILL make a lot more money than they have before. If they are not hitting their goals, then neither of us will be very happy with the results. I find that when we explain this rationale to a prospective candidate, it significantly diminshes their concern about the request.

    I’m not trying to make a message board “power play” – just illustrating another side of the salary negotiation coin. These things aren’t always black and white.

  47. I wouldn’t like to reveal my salary to the employer unless I forced to. But it is also unethical to lie about your current salary. I think the best way is to negotiate and get your desired salary. Employer would love to hire a good negotiator for their company.