Optometric Management Tip # 571 - Wednesday, February 20, 2013
Extending the Job Offer
I received a nice email from an OD in Ohio who found some past tip articles on staff hiring to be helpful, but he suggested I write about "the offer" part of hiring. Great idea! I have not seen anything on that before.
After going through the process of advertising the position available, reviewing resumes and interviewing candidates, we all make the best selection we can. So how do you decide how much to offer?
The starting wage
There may be several factors a job candidate will consider before they say yes to a job offer, but the big one is the pay. If you get the wage right, the candidate will usually accept. Deciding on the starting wage is more art than science and experience in hiring certainly helps, but I'll tell you what makes it easier for me. I have all candidates complete a two page job application form while seated in my reception room. This allows me to control the information more than a prepared resume, which could have been written by the applicant's brother-in-law.
Two of the questions on my application are: "Date you can start", and "Wage desired (per hour)". The wage desired question is key to my hiring process. My office manager conducts the initial interviews and she always pays attention to that figure. If the question is left blank, our manager will ask the candidate to please name an amount. She will even push for it if necessary, in a respectful way, indicating that it will be very helpful to us. We almost always get the number and we do not reveal what wage we are willing to pay. I actually don't have a firm number in advance anyway.
The reason I like the candidate to state the wage number first is because I find that most people will give the lowest number they can accept, since they want to get the job offer. They know if they go too high, it may mean no job. I often find that the wage requested is lower than I would have been willing to pay.
So how much?
There are several factors to consider when you decide on how much money to initially offer.
The points above are important to consider, but I always go back to the desired wage as stated on the application and if possible, I try to offer that amount. If I go lower than that, I run the risk of the candidate accepting the job but continuing to look for employment elsewhere. I see little point in paying more than what was asked for, because I am trying to keep payroll costs as low as possible, but I have occasionally offered more when the amount requested was very low. If the amount requested is higher than I can comfortably manage, I generally pass on this applicant or I may have a very frank conversation about the wages and take it from there.
- What are the applicant's job experience and skills, including non-optical skills like computer technology?
- Will the candidate need the normal training or much more than that?
- What was the candidate's wage history at previous jobs and is she asking for much more than her most recent job?
- What are the wages currently being paid to your other employees with similar job experience and skills? Even though you may have a policy that wage information should be kept confidential, realize that co-workers often share this with each other. While you should not have to defend what you pay any employee, it is a good test to ask yourself.
- Is the wage requested realistic for a good employee in a non-optical career? What is a typical annual salary for a teacher or a retail clerk? A quick way to convert hourly wages into a full time salary is to double the hourly wage and add three zeros. For example, $16 per hour is $32,000 per year. Is $32,000 per year considered a high salary in general terms? Consider that the U.S. Government placed the 2012 poverty threshold for a family of four at $23,000.
- Overall, how much do we like him or her? This considers personality, appearance, communication skills and other traits.
- Does he need health insurance? You may be able to offer a much higher hourly wage if no health insurance is needed.
Do you offer benefits?
For many job candidates, the employment benefits can be more important than the wages. This is especially true with health insurance for people with lower wage jobs. To attract the best employees you need excellent benefits, so look closely at what you offer in health insurance. Even though it is incredibly expensive, I would try to provide an excellent program, such as 80% of premiums covered in a major PPO plan with a drug benefit. A high deductible is usually accepted well. Other benefits matter also, like a retirement plan, vacations, paid holidays, paid training programs and more. If you put a nice package together and if your office presents a nice impression, you'll get most of the people you want.
What are the deal breakers?
Some aspects of compensation are negotiable and you can give more if you have a great candidate, but decide in advance what items are not negotiable. Don't be swept away and give away the farm; keep in mind that most employees have faults and you will find them within the first couple weeks in almost everyone. One of the deal breakers for me is that every employee must work two evenings per week until 7pm and Saturdays from 9am to 1pm. When we make that a requirement of the job, nearly every applicant says it is no problem at all.
Best wishes for continued success,
Neil B. Gailmard, OD, MBA, FAAO
Chief Optometric Editor, Optometric Management