In principle, there are two different situations in which a salary negotiation might take place – either before being hired as an applicant or during a performance review. Depending on the scope of the procedure, the issue of money will be raised at some point during the application process. Of course, there are jobs where it is not possible to have a proper salary negotiation – management has fixed an hourly wage and applicants can either accept or choose not to accept the position. A collective wage or salary agreement makes negotiating superfluous, since the topic of remunerations has already been contractually determined.
Contracts in the UK are fairly flexible, only being restricted by either statutory or a collectively agreed upon minimum wage. The two contractual partners (employee and employer) jointly agree on the starting salary. A first approximation to the negotiation might take place during the first moment of contact. Many employers ask applicants to state their approximate salary expectations in the job advertisement. This saves time for both parties – if it can be seen in advance that an applicant expects far more money than the employer is willing to pay, an interview isn’t worth having. If the expected salary and the amount the employer is willing to pay are similar, it is a good starting point for a salary negotiation to take place.
However, the word “starting salary” makes clear that it is just the first step in the salary ladder. Throughout the course of your career in a company, you will probably have the opportunity to negotiate salary increases again at later stages. It is not unusual to ask the employer to renegotiate your salary once a year. Longer service and the resulting greater experience alone can be a reason for a higher salary. If you have taken on more tasks or responsibilities in the past months than at the beginning of your employment relationship, then you can justify your entitlement to a salary increase – the same applies if you distinguish yourself permanently through excellent work performance.
General inflation can be an additional argument to increase wages and salaries. Although a pure inflation adjustment does not mean that you have more money in your account, it also does not mean you have less. However, beware: Very few employers will pay you a higher salary just because of the inflation.
Another reason for salary negotiations is if you get a promotion to a new position with new tasks and more responsibility. Your employer knows that you won’t settle for your same old salary. Before signing the new contract, salary negotiations usually take place.