Anytime you’re in a position to evaluate a job offer against your current gig, it can be stressful but not a bad problem to have, right? When you have a job and have been working hard at finding a new one by squeezing in job interviews and sending “thank you” notes, pat yourself on the back when you receive that offer letter from the company who has chosen you to work for them!
But before you start working on your resignation letter get down to a little business and evaluate the offer, because the devil is in the details.
This may be the easiest to evaluate – write the numbers down. I’ve put together a quick spreadsheet to give you an idea of some of the basics. Remember that if the company doesn’t subsidize its group healthcare, you should ask for the amounts of both the company and employee contribution amounts along with the plan details before making a decision. The healthcare premiums and plan co-pays can significantly reduce your paycheck’s bottom line. Here’s a quick example:
So even though the base salary of Company B is higher than Company A, you’ll be paying more in healthcare costs with Company B. While the difference is only a few thousand dollars, remember that healthcare costs rise every year and most companies pass along some (or all) of that increase to the employee — which can range anywhere from zero to 15% or higher.
If you’re eligible for a bonus be sure the details are in writing — I can’t stress that enough! Read your offer letter carefully. Does it give the bonus amount? Is the bonus “guaranteed” or does it say that you’re “eligible” to receive one? If it’s guaranteed with the amount, what is the payment frequency? Quarterly? Annually? If it states that you’re “eligible” for a bonus be sure to ask what the variables are that impact your ability to receive it. It could be based on your own work performance, your sales numbers, your team’s performance, the company’s performance, etc. These are reasonable questions that you should be prepared to ask prior to agreeing to an offer.
Other compensation items can be car allowances, commission plans and stock options or other equity plans just to mention a few.
Beyond the Paycheck
After you’ve evaluated the compensation, be sure you don’t overlook some of the other factors to consider in a new gig. In some cases they can be more important than money — even deal breakers. Like if you have a job with a 2-hour commute one way, it’ll get old fast and surely impact your quality of life.
The easiest way to evaluate them is to list them on a spreadsheet and prioritize them by rating them from 1 to 5. Then rate where each company falls into each category. Multiply the importance rate by the company rating to get a weighted rating.
The objective with this exercise is to be sure that you prioritize what’s important to you so you can figure out how close each company comes to meeting your priorities.
Trust your Gut
After you’ve worked through the above details, picture yourself working at the job. Can you visualize yourself doing the job? Traveling to the office every day? Do you look forward to working with the manager who hired you?
There are so many factors to take into account when considering a new gig. You have only one shot to negotiate that offer so don’t rush in when making this decision. Many folks who are not happy in their current position will be hasty to accept a new one only to find out that they may have very well put themselves in a worse position. Take your time so you’re comfortable knowing you’ve made the most informed decision possible.
Did I miss anything?