“Being rich is having money. Being wealthy is having time.”
– Stephen Swid
ACTUAL CASE HISTORY: Brad called us in late December, “fuming,” to put it mildly. Two weeks earlier, he had received word that his annual bonus for the recently-completed fiscal year would be 20% lower than his last year’s bonus, despite his business group’s “numbers” being up 40%. In his six years with his employer, a top-shelf investment banking firm in Chicago, he’d never been treated this way before. To Brad, this was inexplicable, and a serious breach of faith. He could barely contain his anger. A week later, Brad appealed to his boss for a reconsideration of his bonus, but was told, point-blank, “It’s not in the cards.” With seemingly nowhere else to turn, Brad called us.
At our law firm, when we first meet a new client, our initial interaction takes the form of a consultation (by telephone or in-person) usually lasting one to two hours. During this initial session, we strive to gain an understanding of our client (both as a person and as a professional), the problem or opportunity that initiated our client’s call, and what it is that our client seeks, in the “largest picture.” When we asked Brad what he was seeking, he didn’t hesitate a moment: “To sue, get my bonus, and get the **** out.” We were confident he didn’t really mean it.
During Brad’s consultation, we learned, among other things, that he had been relatively happy in his job before his bonus disappointment; there were many things about his job that Brad and his wife enjoyed, and didn’t want to give up. In fact, after prodding we learned that Brad’s primary concern was not the unfairness of his bonus award, but rather whether this unexpected shortfall might really be senior management’s signal to him that he wasn’t viewed as a “keeper,” and that he should look elsewhere for a career. Brad was especially taken aback by what seemed to be his powerlessness to change what had happened, and his boss’s apparent disinterest in resolving the issue.
We also learned that, in the larger scheme, there were other things that were of equal or greater value to Brad than the amount of his year-end bonus. Sure, money means a lot, but it wasn’t all Brad lived for. Once Brad lost his head of “steam,” and returned to his more rational, strategic self, he readily admitted that to be true.
With our counsel, Brad once again approached his boss, this time with a different agenda and using a different tact. Instead of trumpeting his disappointment, as his boss probably expected, Brad approached him in a way he didn’t expect. What Brad did was tell his boss that he now fully accepted senior management’s decision regarding his last-year bonus amount. He offered to his boss that, in the larger perspective, he decided that his disappointment should instead be a challenge to himself, to produce the outsized results that would surely justify the outsized bonus he desired next year. But in order to produce those outsized results next year, he had four suggestions to present for consideration that he thought would benefit everyone.
Brad’s four suggestions were that: (a) he be assigned an additional, critical responsibility in his department, namely, overseeing new client strategy; (b) he be given half the time of an under-utilized research assistant, so that he could better fulfill this new, added role; (c) he and his boss agree to talk frankly in mid-year about support for Brad’s elevation to senior managing director; and (d) if promotion and future outsized bonus were not in the cards, he be permitted to seek employment elsewhere, with sufficient time for transition, without the non-compete he had signed, and retaining all of his unvested equity in the firm. He coupled his suggestions with his view that these alternative requests were in both his boss’s interests, and his own.
From Brad’s perspective, he had already lost his bonus battle, so spilling additional blood in that battle would make no sense. However, these four alternative requests would (a) if provided, give Brad what he truly wanted from the firm, that is, promotion and advancement, (b) If provided, also serve as a platform from which he would more likely get the bonuses he deserved in the future, (c) if not provided, serve as critical data in his own determining whether his bonus shortfall was really a career “danger signal,” and (d) if not provided, serve as a potential platform from which to discuss (and better negotiate) a graceful exit from the firm.
Within two weeks, Brad received his answers: the new responsibility and research assistant were provided, while the mid-year indication on promotion and assurances on vesting if he left were denied. The overall message was, in effect, “Stay, show your value this next year, and here are the additional opportunity and resources to do so.” These put not one single dollar in Brad’s pocket – for now – but represented to him the “sign” he needed to remain with the firm, and keep striving. At no cost, he’d achieved something that, literally, money couldn’t buy.
LESSON TO LEARN: Around this time each year, you may be disappointed with the bonus and raise you receive. If disappointed, it’s important to remain focused on the basics of workplace negotiation. We use our “SkloverWorkingWisdom™” Method for that purpose, taking our clue from how we usually negotiate new employment.
When we negotiate new employment for our clients, money is not our sole focus. Instead we consider a broader sense of “compensation” including each of what we call “The Three R’s of Workplace “Compensation”: (1) “Rewards” (including salary, bonus, benefits and other, non-financial items, too), (2) “Risk-Limiters,” (such as guarantees, commitments and assurances), and (3) “Responsibilities and related Resources” (to expand our client’s authority and develop his or her internal influence.) While our clients tend to focus almost exclusively on financial “Rewards,” we know that non-financial forms of “Rewards,” “Risk Limiters” and “Responsibilities and related Resources,” are just as important, often more so.
Non-financial “Rewards” include higher title, flexibility of schedule and change in reporting lines. “Risk Limiters” represent increments and varieties of protection from loss of “Rewards,” which provide job security, income stability and certainty of future career success. Risk Limiters take the form of guaranteed income, commitments of continued employment or future promotion, and assurances of support or certain treatment in the future. Additional “Responsibilities and related Resources” represent measures that provide additional authority and influence on the job, which over time tend naturally to lead, in turn, to increased “Rewards” and “Risk Limiters.”
Annual bonuses and raises carry with them the same concerns, although at a different time and in a different context. Nonetheless, you should consider the broadest possible range of “compensation” when, in the course of your employment, you receive disappointing news regarding annual bonus or raise. Anger and resentment never work in your favor. Threats inevitably backfire. Using your imagination, creativity and thoughtful, effective negotiation at these times will always work better for you.
WHAT YOU CAN DO: When you receive disappointing news regarding your bonus or raise, consider making a tactful request for reconsideration, but consider, also, requesting alternative forms of “compensation,” including the following:
Forms of Advancement: including additional, critical responsibilities; promotion or assurances of support for promotion; improved title or reporting line; re-assignment to a more productive team; assignment to a prized committee or working group; and exclusivity of territory.
Kinds of Commitment: including assurances of continued employment through a specified date; a minimum guarantee bonus next year; and a decision on a sought promotion.
Types of Benefits: including educational grants to pick up a needed skill or degree; better amenities, such as better office location; authorization to attend valuable networking opportunities such as conferences, trade shows and conventions; and grants of equity in place of cash.
Advantages of Time: including increased vacation; flexibility of work schedule; decreased travel assignments; reassignment of a rather menial task to someone else; and increased staff or other resources.
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Elements of Freedom: including an opportunity to look elsewhere while remaining employed; agreed severance; and an accommodation to retain equity following departure.
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The possible “alternative types of compensation” are limited only by your creativity and boldness. So long as your pitch is made with respect, is reasonable, and its rationale is in the interests of your boss and firm, you really have nothing to lose.
Consideration of “alternative forms of compensation” during times of disappointment can serve several purposes at once: to assuage your anger, to provide additional risk limitation, to improve your career positioning by acquisition of authority and resources, to exhibit your sophistication at negotiating, and to determine the meaning and origin of the disappointing compensation news. By broadening your perspective on potential year-end decisions and your notion of “compensation,” you may in fact turn crisis into opportunity, and even advantage.
Not getting the advancement you want? If your going to seek a new job, we offer many Model Letters for Seeking a New Job. To see the complete list, just [click here]. All of our Model Memos, Letters and Checklists are Delivered by Email – Instantly!
SkloverWorkingWisdom™ emphasizes smart negotiating – and navigating – for yourself at work. When disappointed by a decision regarding your bonus or your raise, smart negotiating is especially important. Gaining maximum rewards – including alternative forms of “compensation”, without unnecessary risks – may be right there for your asking, if only you have the creativity, tenacity and belief in yourself to ask. But it takes more than luck to make that happen. It takes forethought, care and prudence, the essential ingredients in good negotiating.
Always be proactive. Always be creative. Always be persistent. And always do what you can to achieve for yourself, your family, and your career. Take all available steps to increase and secure employment “rewards” and eliminate or reduce employment “risks.” That’s what SkloverWorkingWisdom™ is all about.
A note about our Actual Case Histories: In order to preserve client confidences, and protect client identities, we alter certain facts, including the name, age, gender, position, date, geographical location, and industry of our clients. The essential facts, the point illustrated and the lesson to be learned, remain actual.