What Would You Do? Responses to “Hiring For Success”
By John West Hadley
The Stepping Stone, January 2023
In the September 2022 issue of The Stepping Stone, I presented a hiring dilemma encountered by the head of a small actuarial department. Below is a shortened version; you can read the full situation at the link above. Here are selected responses and excerpts, edited for space and clarity, followed by the real-life conclusion. (Please note that inclusion of responses should not be taken as an endorsement by either the Leadership & Development Section Council or the Society of Actuaries of the positions presented.) Send your own ideas for situations to pose in upcoming issues to SteppingStone@JHACareers.com.
Hiring For Success
Alan leads a small, growing actuarial department, and seeks to add a mid-level actuarial student to his team. This is a highly visible support role that will lead to officer level upon achieving their FSA.
Alan asks about salary expectations. Jennifer responds that she would rather not talk about it. At the end of the day, Alan sits down with Jennifer for a wrap-up conversation, and again asks about salary expectations. She again says that she would rather not talk about it. He presses, and she stammers a bit and says that she hopes he would offer a competitive salary.
The recruiter tells Alan that Jennifer called her that night in tears, and finally shared her hesitation. She had been harassed at a prior actuarial job, left it for a much lower paying role, and was embarrassed about her current salary and level. She felt she was far below the market level, and worried about whether anyone would pay her what she was worth.
If you were Alan, what would you do?
If you were the recruiter, is there any advice you would give Jennifer?
My thanks to all who responded! Reactions ranged across the spectrum from “don’t hire” to “why is her reaction relevant?” Here’s one at the latter end of the range:
You had better watch out asking about pay. Some states have passed laws forbidding employers asking about salary history:
https://www.jdsupra.com/legalnews/does-your-state-prohibit-asking-salary-9668197/
One may wish to be coy and say "Oh, I was just asking about salary expectations!" (I'm sure the employment lawyers are salivating.) You're the one who knows the job. I know you'd love to avoid being the first to state a number, but check your state laws before trying this clever game.
Why gain a reputation as a petty jerk, not being able to recruit talent in a fairly difficult employment market and a small profession? You figure out the numbers yourself. If you are concerned you're offering up too much money for the position, too bad.
Being concerned about Jennifer not entering into salary negotiations would be a deal-breaker if you expect her to negotiate on the job. Somehow, I doubt that will be the case. This is a support role, and you can say it leads to officer level, but will they be doing negotiations as an officer? Signing off on reserves is not the same thing.
You've got an idea of the range, so why play around with them at all? Just make the offer, see if they want to negotiate on that, take it or leave it, etc. As it is, the initial offer may not be the sticking point anyway, if you're expecting them to progress in a short amount of time. Many of us have been used to relatively high increases during student years, so getting huffy about that initial offer seems petty.
These respondents also looked unfavorably on Alan’s salary expectation discussion:
Alan should stop playing games. He obviously has an acceptable range in his mind of what he will pay. Salary negotiations are often unfair and exclusionary, disadvantage those from cultures that are unlikely to negotiate, and enable the gender pay gap. If he otherwise thinks Jennifer is a good candidate, he just needs to make a fair market offer.
I am concerned about Alan not being able to offer a fair salary without knowing her expectations. Many companies have salary scales that actuaries easily fit into based on exams completed. A smaller company may not have that much structure, but industry averages should be easily attainable before deciding to post the position. Having these salary scales applied uniformly within a company helps to combat the gender pay gap.
While this actuary thought Jennifer’s salary concerns might be over-blown:
As a student, it might be a little too early to get fussy about salary. The actuarial program the company offers and what help she can get through her exams would be more important. I left a company for lower pay when I was a struggling student. My existing company had no actuarial program. The new one had a fantastic program. After I got my FSA, I started getting fussy about my pay level.
At the “don’t hire” end of the range, we have these three responses:
I would question hiring Jennifer. If she was the most qualified candidate, I would follow up with questions about her ability to perform the work and leave personal feelings out of the job. As a student, she may need mentorship or expect to learn more on the job. Would I have the bandwidth to support Jennifer in a small and growing department?
Alan should pass on Jennifer. She seems a bit fragile and unless the interviews with everyone were stellar (which we do not know), I believe Alan could find someone else. There are lots of mid-level actuarial students around. My concern is that she is unwilling to take a stand for herself by telling him something about what she wants or how he should respond. How will she manage to present difficult information related to her job? Will she not want to talk about it?
Jennifer did not prepare well to handle this. She fumbled and may not be able to recover. One option is to be honest, but how would she spin that and not look like a bundle of insecurities? It is reasonable to leave a bad job and take lower pay to get away from it. I just don’t think it makes you look like a winner to get so paranoid that you don’t prepare an answer to an obvious question like, “how much money do you want?” She could try telling Alan the truth, trusting that he will look on her situation with compassion. Companies are well into DE&I efforts and should be interested in picking up a female actuary, and might even like that they are treating her right after her bad experience. However, personally, as a woman, I would expect a really solid performance to convince me to hire her. I don’t want to hire someone with no self-confidence and that is how she comes across right now.
This actuary felt both parties were at fault:
Neither Alan nor Jennifer handled the situation in an optimal way. Alan should have told the recruiter that a salary expectation was a prerequisite. And when asked about expectations, Jennifer could have simply replied: “What is this role worth to you? I am sure you have a figure in mind that is commensurate with the role and responsibilities." The fact that she ended up in an underpaid job is not Alan’s business.
Two actuaries called out the recruiter for sharing that Jennifer had called in tears:
I do not think that she needed to tell Alan that Jennifer called in tears. Knowing that is unlikely to help Jennifer's candidacy.
I think it was unprofessional that the recruiter told Alan that Jennifer was in tears. The recruiter should have been able to smooth over the situation and leave that detail out.
Here were other suggestions for the recruiter:
I would tell Jennifer: "Your current compensation is not necessarily an indication of your future compensation. Always ask for what you think you are worth—the hiring manager will appreciate it."
Commend Jennifer for being honest about leaving a job where she was harassed. It takes courage to leave that type of situation and to be up front about it with a potential future employer. I would offer her encouragement and support and tell her not to let that previous experience define her career moving forward.
The recruiter should have been able to provide industry data on what an actuarial student at her level should be earning, which would have allowed Jennifer to easily set her expectations.
I'd find a way to suggest Jennifer talks about the situation with someone because it can affect her career prospects if she allows the experience to make her feel devalued and doubtful every time she interviews.
Explore with Jennifer how she approached determining her market value and validate if it's reasonable or not. Make it clear that whether a company thinks her compensation request is too high or too low is independent from what she thinks is appropriate compensation. If she can help the company see her value production is higher than the requested compensation, the company will find a way to hire her if it's the proper fit.
Mental health is important, and you’re not failing if you ask for help. Jennifer seems traumatized by her past experiences. Perhaps the recruiter could help her find additional support to work through her history and move forward. The recruiter is in a position to provide Jennifer coaching and knowledge about market pay expectations. If Jennifer was not willing to share her reason for stepping back, she could work with the recruiter to define her salary goal, and practice her response to the salary question. “I decided to move into a different kind of role for a while that was lower paying. I learned X, Y and Z from that experience and now I’m ready to step up into the kind of role you’re offering. My knowledge of A and B, as well as my exam progress, makes me more than qualified. I’d like to make $X.”
I’d thank Jennifer for being honest. I’d explain that I understand it was a difficult situation. I’d give her coaching that she could have offered salary expectation based on what she wants, not on her current lower level of compensation. If Jennifer responds well, comes up with a realistic number, and conveys her understanding that she needs to offer her salary expectations for the new job, I’d communicate to the hiring manager that I feel comfortable moving forward.
I would remind Jennifer that it is a salary expectation, NOT current salary. I would encourage Jennifer to do some market research (assisting if possible) to help her determine a reasonable market value for herself. It will be hard for Jennifer to know if she is getting a "competitive salary" if she doesn't know anything about current market values.
I would have poked a bit more on the hesitation to talk about salary expectations before the interview. I would have explained that you always want to go into an interview with a salary expectation in mind.
These respondents suggested how Alan might continue to consider Jennifer:
Alan should arrange to speak with Jennifer, to explain that he understands where she’s coming from in wanting a fair salary, and to give her time to directly share her point of view, rather than relying on the recruiter. Elicit from Jennifer exactly, in a structured and organized way, everything that she brings to the role and to the company. This results in a more in-depth understanding of her talents in relevant areas and her previous relevant experiences, as well as where she’s aiming in her career. Alan can also elicit insights into what she is passionate about in the role.
I am not sure that the recruiter was authorized by Jennifer to share that information, so I would not discuss it directly with her. I would advise the recruiter to tell her (without it seeming to come from me) that her current salary is not necessarily an indication of what she might earn elsewhere, and she should proceed with confidence. If I became aware that Jennifer had received that advice, but still acted with uncertainty, then since the job will lead to officer level, I would look for another candidate.
I don’t believe Alan should pass on Jennifer simply because she was unwilling to discuss salary, as long as she had the right qualifications and aptitude for the job. Perhaps he should have asked Jennifer why she was hesitant to provide salary expectations, and they could have had a conversation.
I’ve had a situation where we had a miscommunication with a candidate during the interview process. We were having doubts about the candidate until he cleared it up for us. Based on that experience, I’d consider that Jennifer did the right thing in the end, calling the recruiter and being honest. Her explanation does seem to rationalize her behavior. I’d ask the recruiter to have a follow-up conversation with Jennifer. If I was satisfied with the recruiter’s assessment, I’d move past it and consider Jennifer for the position.
Alan is in a tough spot. Particularly in a small department, you need to have your team be honest, open, and forthcoming about pretty much everything related to the job. I sympathize with Jennifer’s plight, but not being able to address the situation with your leader would leave me to wonder about how she’d handle the next tough situation/conversation. That said, I’d consider how well Jennifer fits in every other way, her cultural fit and her experience level. I also would weigh how interviewing overall was going. If she was the first person I was talking to, I might want to talk to more candidates. If she was late in the game and other than this issue was very solid, I’d be inclined to cut her more slack. The perfect candidate is a bit of a rarity.
Alan should ponder the relative gravity of the situation and decide whether that is a sufficient reason not to make an offer, if he is really impressed with other qualifications. But if the role includes interacting with different stakeholders, I would lean towards rejecting Jennifer.
Finally, this actuary emphasized trust:
There is a myth that salary negotiation is a game. Salary negotiation is a process of discovering the budget an employer has for a role and at the same time discovering a candidate’s assessment of their own value. These negotiations offer insight into fit. Someone might seem like a good fit, but if their expectations don’t line up with the employer’s, it shows a possible lack of real fit for the longer term.
Eventually Jennifer needs to communicate her expectations, and it is a shame that the recruiter didn’t better prepare her for the conversation. There is no point for an employer in offering someone a job with a salary well below the candidate’s expectations. It is up to Jennifer to be realistic about her value and the long-term potential in the role, and to communicate the pay she would like.
On the other side, employers need to avoid trying to get someone at a bargain price. The employer should equally be willing to communicate with the recruiter and with Jennifer the salary budget. If that overlaps Jennifer’s expectations, then there should be nothing wrong with going to the lower end of the overlapping range which leaves room for generous increases if Jennifer’s performance justifies doing so.
In the end, the issue here is trust. Employers and candidates need to be honest with each other about salary expectations. Finding good people can be hard and it would be a shame for this employer to lose Jennifer because they can’t trust each other to be honest and fair about pay.
What Actually Happened?
Whoever Alan hired would be expected to present to and advocate on his department’s behalf regularly, often independently, with vice presidents and above throughout the company. He felt that Jennifer didn’t yet have the professional maturity that he needed, and decided to pass on her candidacy.
Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries, the newsletter editors, or the respective authors’ employers.
John Hadley is a career counselor who works with job seekers frustrated with their search, and professionals struggling to increase their visibility and influence. He can be reached at John@JHACareers.com or 908.725.2437. Find his free Career Tips newsletter and other resources at www.JHACareers.com.