At some point in the job application process, you might find yourself in a tight spot. What do you do when asked for a salary history? It's especially harrowing if you are hoping for a significant pay increase over your last job. You may be gunning for a job with greater responsibilities than in your last one, or making a transition to an industry that pays better than the one you're in now. Or you may even be willing to take a paycut if you believe you've truly found your dream job. Either way, revealing your salary history could compromise your position of advantage when it comes time to negotiate your pay.
Besides, what you've earned in past positions is not the relevant measure of what you're worth in a new job. The relevant measure is the fair market value of the open position.
Think of divulging your salary history as akin to underbidding in a salary negotiation. Just as you wouldn't want to tell a prospective employer how much you want to make, you wouldn't want to undersell yourself if your salary history was not indicative of your worth. (This goes both ways, incidentally. You similarly wouldn't want to scare off a prospective employer if your previous income was significantly higher than what you suspect they'll offer you.)
What is relevant here is finding an appropriate job against which to benchmark the open position. Find a market price for the job you're applying for, then determine how close to that median you think you should be paid given your experience and accomplishments. What you made yesterday doesn't matter - what your colleagues and peers are making today does.
Once you've found what the job is worth to the market, save the information until the employer has made you an offer. You will have a good sense of what they will have to pay to meet the market, and you'll be on the firmest ground if you negotiate from that informed position. If the company tries to get you to say what you've been making at any time before making you an offer, use it as an opportunity to showcase your diplomatic skills. Then steer the conversation back to the value of the job to them.
Companies may ask you to disclose your current salary at any time during the search process, especially at the following stages.
1. In the ad for the job. Some advertisements for jobs stipulate that candidates must disclose a salary history, a current salary, or a salary expectation in order to be considered for the job. If you choose to apply anyway, stipulate in your cover letter that your salary expectation is the market value of the job. You may or may not get an interview this way, but you won't be forced to yield the negotiating position to the prospective employer.
2. In a telephone screening interview. Before you set foot on company property, someone from the human resources office might screen you over the telephone and ask you to disclose your salary expectations or history. Companies do this to ensure that you are in the right range for them. But you can set them at ease without saying a number by saying, "I have researched the fair market value of this job and, at the appropriate time, provided that we agree on the appropriate benchmark, I think we could find common ground."
3. During the interview. If the question hasn't come up before you get to your first in-person interview, that does not necessarily mean it won't be asked. Many times an employer - it could be a human resources representative or your potential future boss - will ask you about your salary history as part of the interview. You should feel comfortable handling it the same way as you would in the written or telephone versions. In some respects, it is easier to handle the question in person because you can read the interviewer's response to make sure your story is being properly interpreted.
If the company pushes you harder for a more detailed response, try to come up with a few variations on the same answer. Tell the company, with all due respect, that you don't think your salary history should affect your prospective salary future at a different company - especially if it's in a different industry. You could try deflecting the question to focus on what the new job requires and why the old pay would not be a good match.
Of course, this all means that you have to do some preliminary homework. Visit Salary.com and research the position in the Salary Wizard as a good starting point for finding the right job match. Be sure to benchmark the position you're applying for by job content, as opposed to the job title.
It is worth noting that some organizations - civil service organizations are one example - have requirements to disclose pay. But they usually have more rigid pay structures than other employers, so even when you show your pay history, you're not risking as much as you might elsewhere.
Once you've mastered the art of being your own agent, the rest will follow. Remember that the employer is the only one who benefits when you say a number first. And your salary history, simply put, is history.
- Brian Braiker, Salary.com contributor