Ask A Recruiter: When Do I Ask A Candidate About Compensation?

It's our second edition of “Ask A Recruiter,” featuring Greenhouse’s own Caitlin Wilterdink. In this column, Caitlin answers questions we’ve received from the recruiting community. If you have a question, leave it in the comments’ section, and be sure to sign up for our Modern Recruiter Newsletter so that you don’t miss an answer!

Dear Caitlin,

I’m never sure of the right time to bring up compensation with a candidate. At what point of your hiring plan do you ask about salary expectations?

Salary Sally

Hi Sally-

Great question. I ask about compensation as soon as possible, ideally during my first conversation with a candidate. Money is one of the most important things a candidate will consider during the interview process and the sooner you get this out in the open the better.

A lot of candidates are taught to avoid the compensation question during initial discussions or say something along the lines of “I’d like to wait until offer stage to discuss compensation.” Here’s my opinion: I’m not going to waste the candidate’s time or my team’s time interviewing someone to whom we can’t make a compelling offer.

Senior talent and salespeople are normally upfront and honest when asked about comp. Junior candidates or candidates who have not interviewed much will need some coaching. If the candidate is reluctant to disclose this information, tell him that your goal isn’t to lock him into a number, you are ensuring that it makes sense to move forward at all.

My compensation conversation has four parts:

  • What is your current compensation? Do your own homework here and take a guess as to what the candidate is making. If he or she is right out of school, you can normally get comp info from the career services website. Other tools like Glassdoor, Payscale, AngelList, and can give you a good idea of how companies are paying their employees. Educate yourself so there are few surprises when candidates respond to this question.

  • What are your current benefits like and what do you care about? Some candidates really care about free health insurance and a 401k match. A lot of finance, nonprofit, and healthcare candidates will have benefits packages where the individual doesn’t pay a cent. If your company does not offer these, let your candidate know upfront.

  • What are you looking to make? Except for lateral moves, assume your candidate will expect a 10k minimum bump.

  • Do you care about equity? I find this question important when speaking with engineers, especially folks coming from big tech (Facebook, Google) and Silicon Valley. I’ve found that companies from both areas tend to offer a lot more equity than NYC firms.  If the candidate has 70k shares at a Series D company and your firm only offers 10k shares as a Series D company expect that the candidate will want to discuss this.

80% of the time, the candidate’s current and expected compensation will fit with your own company’s compensation. However, if the candidate is currently paid or wants a new compensation that is outside your pay band, be upfront about it. Thank the candidate for her honesty and tell her that you need to address this with the team before moving forward. And then you need to do the leg work with HR and your hiring managers to make sure you can advance the candidate to the next stage in your process.

An important thing to remember: expected compensation can change during an interview process. When candidates interview at other companies they are exposed to different pay bands and benefits packages. Once the candidate has more knowledge around what the market is paying for his or her skill set, expectations may increase. As a result, you should expect to have the comp conversation more than once.

I usually run through these details during an onsite interview or as part of a debrief call before or after onsites.

In your second comp conversation ask:

  • if the candidate has other offers. If yes, what companies and how much?

  • how the candidate is feeling about your company. What does she like about the opportunity?

  • have her compensation expectations changed since you first started speaking? If yes, what has changed?

A second touch point ensures that your offer to a candidate will be aligned with what he or she wants. You want your candidate to be excited about the offer you make. If you come in lower than expected it’s a huge let down for the candidate who now has serious doubts about your company being able to provide adequate compensation. A lateral transfer, or offering the candidate the same comp she’s at now, should also be discussed early on. Laterals are possible but your closing conversations will have a much different tone and focus: less emphasis on the comp package, more emphasis on the company and growth potential.

Now you may be thinking, “what do I do with the candidate who flat out refuses to give me any compensation information”? In my experience the majority of your candidates will give you something with a little coaching. But I have regretted candidates in the past when they have not provided any comp details. I would rather save my team interview time than have us interview a candidate only to find out they want much more $ than we can provide.

**Disclaimer: This post assumes that you know the comp bands for your different roles before you start recruiting. If you are reading this and you DON’T  know your comp bands, definitely start talking with your higher ups about getting access to this information. You need to know what you are working with so you don’t spend time chasing candidates who are out of your compensation ballpark.

Good luck!


Never miss an answer! Subscribe to our weekly newsletter here:

Subscribe Now!

Caitlin Wilterdink

Caitlin joined Greenhouse in October, 2014 as employee #42.  Before Greenhouse, she managed technical and product recruiting for Conductor, Inc. another high growth, NYC based startup. Early career included stints as an agency recruiter and paralegal. She’s tried, and failed, to learn how to code and instead spends her free time figuring out how to Greenhouse @ Greenhouse. Other free time activities include hosting bar trivia, marathon-training and conquering an acute fear of flying.

Filed Under:

Recruiter Tips