Offer Evaluation and Negotiation

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Receiving the Offer

Congratulations on your internship or job offer! There are several key actions we recommend you take whenever an offer is extended. 

1. Express sincere gratitude for the opportunity and reiterate your interest in the organization and position. 

2. Request any additional missing information. What is the expected start date? Did they mention a signing bonus? Who is covering the relocation costs? Getting this information clarified up front will help you as you consider the entire offer package. 

3. Make sure you receive the offer in writing. Often, there are additional details regarding the offer included in the formal letter. These details are essential for you to review and evaluate to fully understand the whole offer.

4. Evaluate timeline. When do they need a final decision by? Are you engaged with other organizations at this time? Consider if you want to ask for an extension.

Evaluating the Tangibles of a Job Offer

Full-time job offers have many components that may impact your final decision. Learn more about the details and terminology of benefits packages at z.umn.edu/CDbenefits. Consider all of these tangible parts of the job offer:

Base Salary 

Base salary is the most significant part of your offer because it will affect your salary every year in the future. Use the following resources to make sure that your offer is competitive with others in your field. Each year, the CBCC team publishes market data for intern and full-time offers in our Employment Reports. Take a look at that data to see how your offer compares to the market. Also, consider using online salary calculators or cost-of-living calculators if your offer is in another city.

Signing Bonus 

Some organizations may offer you a signing bonus if you accept their offer or if you accept early. Signing bonuses represent a one-time bonus taxed at a higher rate and can be used in place of relocation assistance if you need to move for your new job. 

Incentive Plan

You may be eligible for incentive plans after one year or a few years of employment. Examples include a 5% bonus for reaching sales goals, a 10% bonus for customer satisfaction goals, etc. If this is included in your offer, make sure you understand how it will affect your future compensation and if this additional incentive will reduce your base salary.

Vacation or Paid Time Off

Your full-time offer will either come with a description of the vacation policy or paid time off (PTO) policy. They are not the same, so make sure you understand what is included in your offer. Vacation time is usually offered in addition to sick leave and/or personal days. PTO usually means any time taken off (vacation, sick, personal) will be counted the same against your balance of days off. Also, make sure you know if you are eligible to use your vacation or PTO immediately, or if you have a waiting period after you start your new job. Vacation or PTO can sometimes be negotiated.

Cost of Health Insurance

Your portion of the cost of health insurance is a serious consideration with a full-time offer, since it can be a costly expense. Health insurance costs can be high and vary greatly by employer. This generally cannot be negotiated.

Retirement Contributions

Many organizations will make contributions to employees’ retirement accounts as a match to your personal contribution or as a gift. This benefit represents free money for future savings, which will also accrue compound interest. Consider how much your offer includes and add it to your base salary. In general, retirement contributions are standard across an organization and cannot be negotiated.

Organization Car or Phone

Some jobs that require a significant amount of travel come with resources such as an organization car or cell phone. Oftentimes, organizations allow these resources to be used for personal and work purposes. These benefits make a significant difference in your regular expenses. 

Evaluating the Intangibles of a Job Offer

Job offers also come with many intangible aspects to consider, such as the examples below. 

• Work/life balance 

• Challenging work

• Community involvement 

• Free or subsidized parking 

• On-site amenities 

• Company discounts 

• Travel opportunities 

• Work schedule 

• Commute 

• Company values and culture 

• Location 

• Stability of company

• Structured training program 

• Opportunity for advancement

Negotiating a Job Offer

Many students are successful in negotiating parts of a job offer, including a higher base salary, signing bonus, vacation, preferred start date, work schedule, or more time to make a decision. Some organizations will not negotiate at all, and some are open. Many recruiters prefer to have negotiation conversations via phone, and email is also an option. Follow these guidelines to prepare for the conversation:

Do Your Research

If you are asking for more money, vacation, etc., have specific market data to support your request. Have notes prepared to demonstrate you have done your research and tell the company where you got the information. Use published data for salary and benefits. Also consider the unique experience you bring to the table, including past internships, past work with the same company, a foreign language, etc.

Be Respectful

Recruiters talk to many students, and negotiation is a common conversation for them. Approach the conversation strategically and positively, with good research behind you. 

Talk to the Right Person

Call the person who made your offer to negotiate. That person may have to gain approval from your manager to increase your offer, but don’t try to go around the recruiter if they are is the person who made your offer and is waiting for a response.

Ask if Negotiation is Possible

Some organizations will not negotiate offers, and some expect you to negotiate to demonstrate your sales skills. Tell the recruiter or manager you are very interested in the position, and then ask if negotiation is possible before you start sharing all of your research. If they are not open to negotiation, thank them and tell them you will respond to the original offer by your response deadline.

Be Reasonable

Generally, it is considered reasonable to negotiate up to 10% of your base salary, but not more. Know what you are asking for and why before you initiate the conversation.

Get Everything in Writing

If you negotiate a new offer with an organization, they should provide you with a new written offer. You are not required to respond immediately over the phone, even if they meet all of your requests. If presented with a new offer, thank them, ask them to send it to you in writing, and tell them you will get back to them with a response.

Do Not Burn Bridges

If you are not able to come to an agreement on an offer that meets your needs, be gracious and explain the opportunity is not a good fit for you.

Whether or not to negotiate is a personal decision, and each situation is unique. If you decide not to negotiate, that’s OK too!

Managing the Negotiation Timeline

A common concern of candidates is how to manage the decision-making timeline. After asking the employer when a decision is needed, we recommend the following steps: 

• Arrange a time to discuss the details of the offer with the employer before the date your final decision is due. Set up a time to discuss the offer, leaving a window of time before the final decision date. 

• Ask for an extension to the decision deadline if you need it. Most organizations would rather have you ask for an extension to make a good decision than renege on an offer after you have accepted it. Typical extensions range from a few days up to 2 weeks, depending on the employer and position.

NOTE: Intern salary offers are often non-negotiable.

Accepting a Position

You will be asked to sign and return an offer letter to accept a position. Ensure the letter you sign incorporates any changes you may have discussed with the employer. 

Once you have accepted a position, either verbally or in writing, you are committed.  At this point, cease all interview and negotiation activities with other organizations. Reneging on an offer is typically seen as unprofessional and may negatively impact your professional reputation or have other negative consequences. If a company begins to experience multiple reneges from students at the Carlson School, it can negatively affect their future hiring here. 

Turning Down an Organization

If you are in a position to turn down a job offer, there are several steps to take to maintain a positive relationship with the company. First, respond to the job offer as soon as you have reached a decision. Remain appreciative, respectful, and professional throughout your interactions, as your paths may cross again or you might be interested in pursuing future opportunities with that organization. If applicable, mention that another opportunity was a better fit for you at this stage of your career, and express gratitude for the consideration of your candidacy. 

You can find sample language for these scenarios at z.umn.edu/CDcommunications.