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Early Disclosure on Compensation

May 20, 2013
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 When it’s time to negotiate the offer with a future employer, the last thing you want to do is drop a bomb regarding a future bonus or other form of compensation you will be receiving after your projected start date. If you choose to wait to disclose this information thinking it might help your cause, think again. You just took your problem and dropped it off at your future employer's doorstep - talk about an awkward situation.

Bringing up your current bonus in the final portion of the hiring process is just a bad idea. When this sort of news comes along late in the game it sometimes eliminates candidates from consideration. The employer, who had thought that the process was cut and dry, now has to go back and re-evaluate your candidacy. In essence, by waiting to the last minute to inform an organization about your upcoming bonus, there are only 2 scenarios that will play out:

Asking Your Future Employer to Match the Bonus:

This is (very) bad in so many ways. Your position is likely budgeted with some room for negotiation, relocation expenses and other incidentals that may arise. Asking your future employer to strike a check to make you whole shifts the entire burden of this “last minute news” to an organization that has never seen you in action. Pretty risky...

If your future employer is willing to adjust your salary or offer a signing bonus to help offset part of the damage of you having to walk away and leave dollars on the table, then you should feel very good about this new employer. You should not expect them to carry the entire burden, either. If you know you have a future bonus in play during your interview, make sure you discuss this when the topic of compensation comes up. Waiting until the very end of the process after an offer has been discussed is never recommended. Disclose, Disclose, Disclose… 

Asking Your Future Employer to Delay Your Start Date:    

This solution also carries significant risks to both the candidate and their future employer. If your bonus is due 60-90 days after your projected start date with your new employer, a whole lot could change for both parties. While I have seen it (rarely) work out successfully, what usually happens is the offer falls apart because of the uncertainty around a delayed start date. You're risking  the organization going with a candidate who does not have that baggage instead running with the possibility that you may change your mind while waiting to receive the payout. The CEO or other executives who supported your candidacy could leave the organization – leaving you completely unknown to the new regime. Not good.

In the recruiting world, time does not bring candidate and employers together. There are countless things that could also go wrong while everyone waits for you to collect your bonus. Again, some compromise may be in order. Perhaps a partial signing bonus would help offset some of what you are walking away from. Also, if you are planning to leave there must be reasons other than the almighty dollar that  are motivating you to entertain new opportunities. If that’s the case, and the new opportunity slips away once you have received your long-awaited bonus check, you still have to face the fact that you are still there and likely still miserable.

The real key here is once the compensation discussion begins you have to disclose everything that could impact your future employer regarding compensation – or you risk being eliminated as a candidate. It’s also a bit disingenuous to NOT disclose all of the facts until you get an offer. (OK, that was candy coating it a bit. It’s downright wrong.)