Salary Negotiation for Earning to Give

post by mulholio · 2019-04-03T12:30:34.959Z · score: 56 (25 votes) · EA · GW · 28 comments

I recently accepted a new software engineering role for which I negotiated a higher salary. I plan on donating much of the increase I negotiated and this made me wonder if a scheme could be set up which offers salary negotiation services in exchange for a pledge to donate some or all of the extra salary to charity.

There seems little to no information on salary negotiation in an earning-to-give context (see https://haseebq.com/my-ten-rules-for-negotiating-a-job-offer/ for an exception).

This scheme would have a very low cost with back-of-the-envelope calculations roughly as follows:

Assuming an average boost of $5000, half of which is donated, this gives us an estimated 1:25 cost-benefit ratio, excluding compounding benefits.

It might also make more sense to provide lower cost materials such as pointers to blog posts, podcasts and books as this might have similar benefits with near zero cost. This might be the best place to start before evaluating the scheme to see if it is worth expanding.

Other things to consider would be how well this translates outside of engineering roles. My strategy worked partly because my role is in high demand in the current market. Other professions might not be as suited to negotiation. However, even if this only suits engineering, this could still prove a useful scheme given how many EA engineers there are.

I'd be interested to hear people's thoughts on how they think this scheme would work best. Some questions I have:

28 comments

Comments sorted by top scores.

comment by Jeff_Kaufman · 2019-04-08T19:21:49.929Z · score: 26 (10 votes) · EA · GW

I've helped a few people negotiate salaries at tech companies, and my experience has been people always bring me in too late. You want to have multiple active offers at the same time so you can get them to bid against each other. For example, when I came back to Google I did:

  • Google made me an offer
  • Facebook beat Google's offer
  • Amazon declined to match either offer
  • Google beats Facebook's offer
  • Facebook beats Google's offer
  • Google matches Facebook's offer

The ideal for you is lots of back and forth, which is the opposite of what they want. They want to cut it short and will say things like "You're asking for a lot, but I think might be able to get it for you if I talk to my boss. If we can do $X can you confirm you'll accept it?" You want to be positive enough that they'll come back with an offer of $X, but not so positive that you have no negotiating room left if they accept it.

comment by Halffull · 2019-04-10T08:57:15.291Z · score: 4 (3 votes) · EA · GW

You can often get the timing to work late in the game by stalling the company that gave you the offer, and telling other companies that you already have an offer so you need an accelerated process.

comment by Raemon · 2019-04-13T20:12:20.799Z · score: 7 (3 votes) · EA · GW

BTW, if you're a tech worker and you feel a vague obligation to learn how to negotiate but it's kinda aversive and/or you're not sure how to go about it...

...even just bothering to do it at all can net you $5k - $10k a year. Like, just saying "hey, that seems a bit low, can you go higher?"

There are various more complicated or effortful things you can do, but "negotiate at all even slightly" is surprisingly effective.

comment by Henry_Stanley · 2019-04-05T11:14:47.606Z · score: 7 (2 votes) · EA · GW

Great idea. When getting a new tech job, Haseem's article was really the only useful resource out there for salary negotiations.

comment by Milan_Griffes · 2019-04-03T21:34:42.920Z · score: 5 (4 votes) · EA · GW

Relatedly, I've gotten a lot out of Never Split the Difference, a negotiations playbook written by a former FBI lead negotiator.

comment by mulholio · 2019-04-03T23:54:29.509Z · score: 12 (5 votes) · EA · GW

It's on my list. https://fearlesssalarynegotiation.com proved most useful for me, closely followed by https://www.kalzumeus.com/2012/01/23/salary-negotiation/

comment by richard_ngo · 2019-04-05T16:17:34.340Z · score: 5 (4 votes) · EA · GW

Strong +1 for the kalzumeus blog post, that was very helpful for me.

comment by Milan_Griffes · 2019-04-04T03:08:11.254Z · score: 3 (2 votes) · EA · GW

Yeah, I love that Kalzumeus post!

comment by david_reinstein · 2019-04-13T14:52:24.365Z · score: 3 (2 votes) · EA · GW

Trigger warning: contains some academic economics palaver and self-promotion.

Classical economics arguments

The case (as in 'no Lean Season') seems to depend on inefficient behavior/job applicants leaving money on the table. If there were such great gains to negotiating why wouldn't the applicants always hire a negotiator? This lends some credence to those saying that there is a cost in terms of rescinded offers. In some sense, this would mean that if the EA community offered free negotiating services in exchange for such a pledge, they would be gambling with the applicant's funds.

*So what might be the case to still justify this?*

Behavioral and modern economics/psychology

1. Psychology/biases in giving

This is not necessarily a bad thing. If the applicant is willing to take such a risk, this might be a good way to indirectly elicit donations. It also relates to the give if you win mode I have been researching.

2. Biases in negotiating

This also might be a 'nudge towards negotiating'; perhaps people are reluctant to stick their neck out and negotiate for themselves because of some intrinsic psychological bias, but they might be willing to do so with the support of the EA community, and knowing that it would lead to helping effective causes, well bringing them some positive reputation in the process.

3. Psychology and 'biases' in volunteering

This may unlock the volunteer services of expert negotiators in a particularly effective way. Because of the signaling benefits (it's more public!), corporate rewards, and internalised feeling of impact people may be more willing to volunteer than to donate the equivalent amount in terms of the value of the time. This relates to my proposal for the Corporate bake sale.

4. Synergies enabled by cooperation between altruists

In Principal-Agent problems there is a well-known inefficiency that results from the combination of hidden information and either limited-liability or asymmetric risk-preferences. This is essentially why economists believe (and have some evidence) that real estate agents usually get a lower price when they sell a house for someone else vs. their own house.

However, if the negotiator here is EA-aligned, their interests will better converge, and there is an efficiency gain to be had here. (A bunch of papers make this case ... about the efficiency gains resulting from altruism on one side or the other, including my own paper on the theoretical argument for 'fair trade'.

comment by Halffull · 2019-04-07T08:40:17.765Z · score: 2 (2 votes) · EA · GW

There's another good post on salary negotiation in an ETG context here: https://www.lesswrong.com/posts/Z6dmoLyfBdmo6HEss/maximizing-your-donations-via-a-job

Back when I was a career coaching, I used to run a popular workshop on salary negotiation for the local job search meetup. It broke down salary negotiation into a set of 6 skills you could practice such as timing your offers, deferring salary negotiation, overcoming objections etc.

The great thing about this was that after the initial presentation, job seekers could practice the skills with each other meaning I wasn't the bottleneck. Presentation is here: https://www.evernote.com/shard/s8/sh/d45a92cc-a8d0-4b3b-adf5-53b53e1efbc6/a423ecc18c4d0a386b5fe1d2284680f7

I could see a similar idea of a practice group working for EAs.

comment by John_Maxwell_IV · 2019-04-05T19:16:28.631Z · score: 2 (1 votes) · EA · GW

A friend of mine recommends the book Bargaining for Advantage.

comment by belitre · 2019-04-13T17:30:40.466Z · score: 1 (1 votes) · EA · GW

Hi here,

Sorry I'm new to this forum and to effective altruism so I will probably just raise questions you have seen thousand of times.

Moreover I'm not a native english speaker so I'm not sure all my words will make sense.

Still I think I can benefit from your thoughts or maybe you can point to me some other threads that deals with my questions.

I have the feeling that if I get paid more from the same job, the extra money doesn't appear from nothing. I get it from the community and it means there is less for the others.

And even if I give all this extra money, I will still have benefit through the "pride" of giving more and through the power to choose who I give this money to.

More over if I have some high skilled job, the principle of concurrency will contribute to raise the salary of other people that have the same job, and of people higher in the hierarchy that will want to earn more than me (and that won't necessarily give this money).

I have the impression that if all members of developed country were willing to be effectively altruist, they should lower all their salaries in order to make the currency of all poor countries relatively higher.

Of course it is not a real case and I can understand that, as the number of people trying to be effectively altruist is low, it is more effective to try to earn more, so that we can give more to things that we think are important (like robin hood ?).

I say that because I remember of a documentary that was presenting a hacker to steal money (from honest people) for a living and that was considering he was a good man because he was giving more than half of the money he steals. And that story has disturbed me by making me understand that (earning X + Y and giving Y) or (earning X) for the same job is not the same thing.

So I wonder if there has been some studies or articles about that and that may try to see what percentage of population willing to lower their salaries it would require to have a positive impact.

But maybe my reflections are totally flawed, don't hesitate to correct me where you see I'm wrong.

comment by kbog · 2019-04-13T20:18:38.084Z · score: 3 (2 votes) · EA · GW

Yes the basic idea here is that you, as an Effective Altruist, have some power and knowledge to judge which use of money is more important. Your employers/customers... or a charity of your choice.

So I wonder if there has been some studies or articles about that and that may try to see what percentage of population willing to lower their salaries it would require to have a positive impact.

That's what income taxes are. People vote for governments to impose taxes on everyone. This is easier than convincing people to give up their own money. Income taxes are usually progressive, which means the rich pay more % of their income than the poor and it reduces inequality.

Tax money usually stays in the same country rather than going to the global poor, but that's no different from people agreeing to take a lower salary, because your customers and employees are probably going to be from your own country anyway.

comment by belitre · 2019-04-13T21:07:17.593Z · score: 2 (2 votes) · EA · GW

So if I consider that as an Effective Altruist I have some power to judge which use of money is more important, asking for a higher salary seems in a certain way to be asking for more power to judge what is more important.

Of course the rest of the society is not forced to give me more money and I agree that in practice I may have a better use of that money but still theoretically I have the impression that asking for a better salary it is saying that what I do is more important that what others do and that I can judge better than them what we can do we that money.

Personally I don't think that income taxes are is the same that reducing salary inequality. If some one earn 100 times more than another one, he will thinks his work is 100 times more important even if taxes take 50% of it. And he will have the impression to contribute more to the society because of the taxes. If in an other society he does exactly the same job, have exactly the same amount of money to live with, we tell him that half of what he is earning is in deed financed by the society to help him, I don't think he will have the same opinion on the rest of the society.

I have the feeling that if we accept to leave in a society where the salary is more based on our capacity to negotiate it than the work we produce, we accept to raise inefficiency and inequalities in a certain way.

It's a personal feeling but it seems important to me that what we earn in a society is based on the importance of our contribution to that society, which of course is not currently the case. And we have too much well paid jobs that are really harm full to the society.

But of course it is just moral issues, it doesn't prove that the more effective way to improve current society is not to try to earn more in order to give more.

comment by kbog · 2019-04-13T22:24:13.626Z · score: 2 (1 votes) · EA · GW
I have the impression that asking for a better salary it is saying that what I do is more important that what others do and that I can judge better than them what we can do we that money.

Yes, and it is more important, and you can do better - because you're on the EA forum and they're not.

If you're employed by an EA organization then feel free to take a low salary.

It's a personal feeling but it seems important to me that what we earn in a society is based on the importance of our contribution to that society, which of course is not currently the case. And we have too much well paid jobs that are really harm full to the society.

Higher paying jobs do tend to provide more value to employers and customers, that's why they are willing to pay for the salaries. It's true that this can be distorted because of wealth inequalities and other issues, but giving everyone the same salary wouldn't necessarily be any more accurate - it's not the case that everyone contributes equally to society either.

comment by belitre · 2019-04-13T23:48:51.451Z · score: 1 (1 votes) · EA · GW

Thanks a lot for the responses, I agree that giving the same salary to everyone is probably not a good idea, and you are right that if some one pay you higher it's is because he estimate you provide him more value. Of course the interest of the one that pays you may not be correlated to the global interest but I better understand the logical at saying that the best effective way to do good can be to earn as much as we can in order to give more, and it doesn't imply that what we do in our work is necessarily the best for the society in itself.

I am still not very comfortable at envisaging my self as a benevolent dictator, but I realise that until the society is not sharing effective altruism ideas in it's almost totality, it is probably the most effective way. And to be honest I am currently far from giving enough (in percentage and quantity) to be risking to that anyway !!

I'm still have some psychological barrier with the idea of trying to earn always more but it is certainly linked to some anti-consumerism beliefs that doesn't apply here as the goal is not to buy more useless things and services and given that there is probably too few effective altruists to have a impact on society, global salaries.

Moreover the impact of income inequality on happiness is probably lower that I was unconsciously thinking (https://www.pnas.org/content/107/38/16489), even if it may have also other negative impacts impact like confidence in the society.

comment by david_reinstein · 2019-04-13T14:58:40.367Z · score: 1 (1 votes) · EA · GW
How would you ensure people stick to their promise to donate and don't just use the advice/time for non-earning-to-give causes.

1. We could offer this only to those who already have a public verified record of substantial EA giving.

This would seem to be a reasonable filter/screen on honesty. It is possible that such people would take advantage and not keep the promise to donate the additional amount, but it seems unlikely. Perhaps there are people with a consequentialist ethic who want to help effectively and donate a lot, but are nonetheless willing to be dishonest and swindle fellow-EA-ers, but it doesn't seem terribly possible.

Note that even if people did not consistently donate the additional negotiated salary, this would still serve as a 'reward' for public EA donors, perhaps encouraging others to follow suit.

2. I would suggest that the negotiator/EA sponsor ask them to state their expected salary and salary range and then afterwards to state the amount they were able to negotiate and the amount they had donated. People will probably be less willing to default on their promise if doing so requires explicitly stating this or lying about it.

comment by garrymalvin · 2019-04-08T08:28:37.845Z · score: 1 (1 votes) · EA · GW

hello,

That's a Great idea. I'm sure plenty of people have considered paying someone else to manage the negotiation for them before, but the risk is always that the fees don't outweigh the increase in wage you would have gotten negotiating by yourself.

thank you,

comment by Denkenberger · 2019-04-06T04:41:47.305Z · score: 1 (2 votes) · EA · GW

For professor negotiations, this says about 2% of the time you try to bargain, the offer is rescinded. But because university positions are so competitive, I would not be surprised if the general rescinding rate were significantly less than this.

comment by Halffull · 2019-04-09T19:31:15.284Z · score: 1 (1 votes) · EA · GW

Last I looked at the data for job negotiations, the rescission rate is actually much higher for jobs, around 10%.

comment by Denkenberger · 2019-04-09T23:36:00.068Z · score: 2 (3 votes) · EA · GW

Wow - that is a lot of risk. One would need at least an 11% increase in compensation for negotiation to make sense, even if one were risk neutral. And most people are risk averse, meaning they would need an even bigger payoff, which might not be realistic.

Edit: this is not correct - thanks for people pointing that out!

comment by Halffull · 2019-04-10T08:56:03.535Z · score: 9 (3 votes) · EA · GW

It matters less if you time your offers so you have multiple at the same time.

comment by Denkenberger · 2019-04-10T22:38:13.392Z · score: 2 (1 votes) · EA · GW

Agreed.

comment by beth​ · 2019-04-10T19:03:39.021Z · score: 3 (2 votes) · EA · GW

I don't think that 11% figure is correct. It depends on how long you would stay at the company if you would get the job, and on the time you would be unemployed for if the offer were rescinded.

comment by Denkenberger · 2019-04-10T22:37:49.509Z · score: 2 (1 votes) · EA · GW

Good point!

comment by kbog · 2019-04-06T07:28:19.231Z · score: 1 (2 votes) · EA · GW

Wait wouldn't competition make rescission more likely?

comment by Denkenberger · 2019-04-07T21:31:05.917Z · score: 4 (2 votes) · EA · GW

Right - I'm saying the 2% rescission rate for professor positions is high because of competition (employer has more power), so the rescission rate outside of academia would likely be lower (employee has more power, at least now).

comment by casebash · 2019-04-04T22:48:23.232Z · score: 1 (1 votes) · EA · GW

I think this is an excellent idea and that someone should pursue this. I'm sure plenty of people have considered paying someone else to manage the negotiation for them before, but the risk is always that the fees don't outweigh the increase in wage you would have gotten negotiating by yourself. Here, since the money is going to charity, this risk is much less of a concern because at least it is doing something and the world has improved even if you don't earn a single extra dollar.