Define your worth, define your salary

© Andriy Popov – 123RF.com

"It is important for the job seeker to understand if the company is offering a basic pay and benefits or if the company is offering a total package (cost to company)," says Nazlie Samodien, South African Rewards Association (SARA) Exco member.

"Take home pay can vary, depending on how the company's remuneration is structured. I have seen job seekers, earning a basic salary of R15,000 and being offered a total package of R20,000, being under the impression that they are being offered an increase of more than 30% without knowing that they must now pay for all the benefits from the total package that is being offered."

There is no rule of thumb on what to ask for on remuneration, it is dependent on the seniority of the role, the scarcity of skills that the job seeker has, the availability of variable remuneration such as commission and the level of experience that the job seeker has to offer. Job seekers need to take in a number of considerations before accepting a salary offer.

• Establish payment structure - The first is to establish whether or not there is variable pay such as a commission and how the company structures the commission scheme. "I would advise that potential employees ask what the average commission payments have been with other employees in the role over the past six months. This will then put them in a better position to understand what measures are used to calculate commission and how hard or easy it will be to earn."
  
• Consider total earnings - This incorporates any other incentives provided by the business such as bonus payments or long-term incentive schemes. An employee can be worse off if they don't consider these variable pay elements over both the short and long term.

"Depending on what a candidate is sacrificing in their current role they may want to negotiate this on appointment. For example, if they are eligible for a bonus with their current employer and the payment is imminent, you can negotiate an on-appointment bonus with the new company. It is also worthwhile asking the new company for a mock payslip so that it is obvious to see what will be paid into the bank account once all the deductions have been made."

"Depending on the role, the successful candidate may need to do a lot of travel and a company car or fuel card may need to be factored in. Then there are medical aid, retirement plans and income protection benefits for the employee in the event of death or disability. It is worth asking what the returns on the retirement funds have been over the past five years and what the taxes on these benefits will be."

• Work/life balance - In addition, it is important that the employee establish those aspects of work-life balance that they need to thrive. Many organisations offer gyms, crèches, wellness centres and more, ensuring that their staff have opportunities to unwind or look after their children.

• Performance incentives - "Some employers have outstanding recognition programmes that are linked to performance and that can include overseas trips and these form part of the employee value proposition.

"Job seekers need to consider all of the reward elements that are on offer, especially if the pay element is not quite what was expected, to determine if the long term benefits will outweigh the short term salary sacrifice," concludes Samodien.