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Internal promotion, but a pay decrease

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I applied for a new department within the company that I work for. After two weeks of interviews with many candidates, my company provided me a verbal offer. Within this company we have tiers based on responsibilities. I値l be going to a lower tier, which means I値l have more responsibilities (promotion). The verbal offer was for a lower compensation then what I知 earning right now. I asked the internal recruiter why my compensation was X, when I was already making XYZ and this is a promotion. The recruiter said that for the 澱udget they want someone for X compensation. I came back with, 努ell for a higher tier, I make XYZ already and you can easily see this. I知 trying my best to see if it痴 worth it. The difference between X and XYZ is about 10%. My current position has an incredible amount of job security. This new department is secure, but somewhat less.Pros:滴igher Level of Management忍xtra Week of VacationMore opportunity to earn more thru commissionsCons:Less pay immediately (Could make more in bonuses)No Overtime opportunityA new department, which could end up lead to an immediate closing Less Job SecurityThoughts?

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You know, reading OP's statement made me think this is an 'In-N-Out' Burger job.

New Department = New Store
Promotion = Mg... (more)

forbin4040 (Jul. 28, 2017 @ 12:34p) |

Good point. Makes me wonder just what exactly are the details of pay here. Some higher-up positions give more of their p... (more)

InFlamed (Aug. 05, 2017 @ 6:10p) |

For what it's worth, I just got the pitch again Friday. My boss turned in his resignation. The company promptly contac... (more)

drodge (Aug. 05, 2017 @ 9:01p) |

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If the new job has more responsibility, less security and less pay, politely decline.

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I wonder if this is a ploy to get you to work harder for less.

Usually it's More work same pay, but More work and Less pay? wow
Welcome to Corporate America (Yes this is a dig at those people in Government jobs who think that Corporate jobs are better)

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Why is this even a question? You want the least responsibilities for the most pay. You somehow are being offered the opposite.

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OP - sorry, but any time I hear a story like this, plus I hear the term "internal recruiter", my ears perk up much like those of the beloved Shetland Sheepdog of my childhood... As well as a small red flag.

Tell me, in your firm, did the position of "internal recruiter" roughly coincide in timeframe with a term like, well, "right-sizing"?
Just Say No

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Forgot to ask,
OP

If this is a new department:

1) Is this the same kind of work?
2) How do you know it's more work if a new department
3) Did someone 'headhunt' you for this new job?

rated:
OmarLittle666 said:   I applied for a new department within the company that I work for. After two weeks of interviews with many candidates, my company provided me a verbal offer. Within this company we have tiers based on responsibilities. I値l be going to a lower tier, which means I値l have more responsibilities (promotion). The verbal offer was for a lower compensation then what I知 earning right now. I asked the internal recruiter why my compensation was X, when I was already making XYZ and this is a promotion. The recruiter said that for the 澱udget they want someone for X compensation. I came back with, 努ell for a higher tier, I make XYZ already and you can easily see this. I知 trying my best to see if it痴 worth it. The difference between X and XYZ is about 10%. My current position has an incredible amount of job security. This new department is secure, but somewhat less.Pros:滴igher Level of Management忍xtra Week of VacationMore opportunity to earn more thru commissionsCons:Less pay immediately (Could make more in bonuses)No Overtime opportunityA new department, which could end up lead to an immediate closing Less Job SecurityThoughts?

At face value taking the new position seems like a bad idea... but you need to dig a little deeper. Remember, because you already work for the company, even if you say no, the way you handle it will follow you while you remain at the company,

They've made an offer - so at the moment you're in the driver's seat (they are clearly interested). The question you need to ask them directly (I would ask the hiring manager at this point) is: "Why should I take the new position? At first glance it appears to be additional responsibility and risk with a lower compensation." Then you need to let them speak. Don't start justifying, etc yet.

One thing I picked up on is you mentioned it's a 10% lower base pay. But you mention the opportunity to earn more through commissions. What exactly does that mean? It's common in sales roles to have a lower base with a high amount "at risk" or commission. In fact, I average 2x my base in commission (so my total at the end of the year is 3x base). My "Total Target Compensation" they budget/expect (base + 100% commission) is approximately 1.5x base. By having a large chunk of my pay in the commission bucket, I'm achieiving 3x base by over-performing.

Every year I ask for a larger raise in my base pay than the standard 3%, and their answer is "sell more and you'll make more". Frankly, they aren't wrong, and I know it's the answer I'll get but I play the game anyway.

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take the promotion, update the resume, and use the promotion to get a raise (above XYZ) at another company.

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rufflesinc said:   take the promotion, update the resume, and use the promotion to get a raise (above XYZ) at another company.
This is the biggest reason why it may be wiser to take the position if I decide to do it.

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This isn't that unusual. Could be like going from hourly with overtime to salary. Less money short-term but more in the long run if you're moving up.

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OmarLittle666 said:   More opportunity to earn more thru commissions
That mean this is a sales job? If so, what are you selling? Could your job be eliminated eventually as more sales are done online?

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If you can insist on down, everything will change a lot.

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TravelerMSY said:    Less money short-term but more in the long run if you're moving up.
He'll make it up by volume of work

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The commission/bonus seemed to be an afterthought in your post, but that could be a huge part of the job's compensation. I've seen plenty of jobs with little or no change in base compensation, but came with a 50%-100% increase when everything was considered. So, what's the total package? What's your income "at plan?" And how reasonable and possible is it to make plan?

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supersnoop00 said:   The commission/bonus seemed to be an afterthought in your post, but that could be a huge part of the job's compensation. I've seen plenty of jobs with little or no change in base compensation, but came with a 50%-100% increase when everything was considered. So, what's the total package? What's your income "at plan?" And how reasonable and possible is it to make plan?

The other thing I have seen is that there is a "management" bonus structure at some companies -- and the higher you go the bigger part of it you get. It is sometimes a backhanded way to increase executive compensation without being as obvious about it -- each tier takes the same amount but it is divided among fewer people. The few fat cats at the top get the most cream. Since it is a "company-wide" bonus "pool" it doesn't raise as many flags.

One employer had an "employee bonus", then a "management bonus" and there was obviously an "Executive bonus" but it wasn't disclosed. Yes, the managers got the same bonus (6-12%) as the employees BEFORE their own kicked in.

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This happens every single day in Govt. contracting. Of course they want someone to do more for less. The only question to ask is "Am I that fool?" Sadly, lots of people seem to think that job titles mean something and will trade a pay cut for a name plate on their desk that sounds more impressive in their own head. I've been offered many of these "opportunities" over the years. I can tell you from years of experience and observation that almost never does any potential payoff of future opportunities actually materialize. If the company knows you're dumb enough to fall for this, why would they promote you to more responsibility later. In fact, this is a great opportunity to go your company's competitors now. Say "I've just been offered a promotion to X position, I'm looking for similar opportunities here." You may just find someone else who's willing to give you both the promotion and a pay raise.

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how many $ ?

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OmarLittle666 said:   Within this company we have tiers based on responsibilities. I値l be going to a lower tier, which means I値l have more responsibilities (promotion).

To be clear, is this being presented to you as a promotion, or are you just interpreting it as a promotion? Having more responsibilities in itself doesn't necessarily make it a promotion, just a different position.

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OmarLittle666 said:   I値l have more responsibilities (promotion).
The difference between X and XYZ is about 10%.
Higher Level of Management
Extra Week of Vacation
More opportunity to earn more thru commissions
Less pay immediately (Could make more in bonuses)
No Overtime opportunity



OP, you need to provide more information in order to solicit valuable advice. Here are some questions and comments:

  • More responsability is not necessarrily a promotion, it's just more work. More responsability is not always as glamourous as it sounds, especially if means longer hours, trouble employees, dificult clients, impossible tasks, etc.
  • Difference in base pay is 10% of what current number. If you are currently making $50K, accepting the new position would lower your pay to $45K. However, if you currently make $150K, you will be making $15K less. There may be a sweet spot where this makes sense for your particular circumstances.
  • Higher level of management. Everyone wants to have a "manager" title, and employers know this. So, they create more "manager" positions. Even I did this. I changed the title of an employee on an hourly wage from operations specialist to internal operations manager, put him on an annual salary, and made him work more hours, with a meager increase in pay. He was happy as a clam.
  • From a financial point-of-view, under no circumstanced does an extra week of vacation compensate for the loss of 10% of your current base income.
  • Opportunity to earn more from commissions. Do the commissions you could earn equal more than the overtime you will be losing out on? Will you have to work more hours to attain those commissions?
  • Opportunity to earn more with bonuses. What kind of bonuses? If they are guaranteed, yes. If they are based on your performance, maybe. If they are based on company performance, maybe.
  • Are there any other perks that you would get by accepting the new position.

rated:
You know, reading OP's statement made me think this is an 'In-N-Out' Burger job.

New Department = New Store
Promotion = Mgmt
Less Money = Is a salary with no OT
Commissions = Mgmt gets a Percentage of Store Sales
Secure = Job guaranteed for at least a year.

I don't know why I think this, but owells.

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TravelerMSY said:   This isn't that unusual. Could be like going from hourly with overtime to salary. Less money short-term but more in the long run if you're moving up.

Good point. Makes me wonder just what exactly are the details of pay here. Some higher-up positions give more of their pay in bonus form. Some people think going hourly to salary is a pay cut (and sometimes they are right). It can be a gamble, it can also be a massive payday.

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For what it's worth, I just got the pitch again Friday. My boss turned in his resignation. The company promptly contacted me and offered me a "promotion". I'd take on his job title, as well as most of his duties. I'd also keep all of mine. In exchange, I'd get zero extra compensation. They were honestly shocked that I wouldn't jump at the opportunity to become Director. I told them I'd love to be a Director, as soon as they are ready to pay Director pay. Otherwise, I don't need extra headache in exchange for a new title.

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