Question about job offers:

Anonymous

February 13,2023 at 5:33PM UTC

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Question about job offers:

How common is it to negotiate based on a verbal offer vs a written one?

I received a verbal offer for a job, and the recruiter walked me through a breakdown of the compensation, following which I grabbed a screenshot of the details. He stated that certain parts of the compensation were subject to specific payment terms, and a few other details, which I could only capture at a high level - as I was taking notes. Now, there is also an equity grant attached to the offer, and while the comp breakdown contains the strike price and external pricing, equity is a messy affair and I'd like just to know what I am getting into, as I've never received such compensation before. The verbal offer doesn't contain the specifics of it.

Additionally, the recruiter has factored in the potential gains from this grant, and added it to the compensation, and I've been trying to wrap my head around tax, exercising and other things before replying.

My questions are:

I've been advised to ask for the written offer to get a full understanding of the job. However, the recruiter wants me to confirm the numbers prior to generating the offer and I feel there is some information asymmetry here. He has mentioned that he needs some approvals after I confirm to generate the written offer. In the sense that I will not know things till the written offer is generated, I've had to keep asking for information (he hasn't been proactive about sharing benefits etc), and I will not fully know what I am confirming. Should I be insisting on the written offer and then negotiate? Or can I counter with the verbal offer? Can any recruiters/HM's in here comment on whether this is a good practice from this recruiter?

Is it common for recruiters to factor in equity grants (not RSU's) into TC? I think this is a bonus component, that could go up or down - and I'm outside the US. My country might have entirely different taxation laws.

I'd appreciate some advice, thanks!

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Joan Williams, Senior Talent Acquisition SpecialistFebruary 13,2023 at 6:42PM UTC
Typically, when a verbal offer is presented is the time to negotiate.
Yes, offers need to be approved, sometimes by multiple levels up the chain of command. I would really rather not have to go back to get another approval on an offer for something we could have negotiated when I extended the verbal offer. And you have already accepted the verbal offer - why did you accept the verbal if you wanted to negotiate it?
YOU SAID: "Additionally, the recruiter has factored in the potential gains from this grant, and added it to the compensation" Uh, isn't there just as much of a chance that there could be potential losses or it could do nothing (no loss, no gain)?
I think it was you who posted the other day. If so, this post raises additional red flags as it sounds like you're having to pull information out of this recruiter when he should be giving you all this info willingly.
Typically, additional compensation - bonuses, etc - are just that - additional compensation so please make sure they're not underpaying you by dangling this equity in front of you.
I highly recommend you find yourself a well-qualified financial advisor to look at this.
So to answer your question, yes - typically the time to negotiate is when the verbal offer is extended but DO NOT be afraid to negotiate after you get the written offer if necessary because of this additional comp.
AnonymousFebruary 13,2023 at 6:53PM UTC
Thank you.
Yes, it was me - the lack of knowledge about equity is bothering me. It's a difficult market so I want to see how far this goes before I throw in the towel. I didn't accept it yet, I was just wondering why they'd ask me to accept something without it being formal. I don't want to renegotiate a written offer but I am not certain what terms I would accept if I said yes to the verbal one.
Indeed. Seems like I'm doing his job for him. Thanks for your help! I also plan to meet with an advisor to see how much I don't understand - it's very easy for the recruiter to deflect my ask toward higher comp by stating the equity.
AnonymousFebruary 15,2023 at 4:41PM UTC
Verbal offers can be fudged prior to the written offer. Get every step IN WRITING. Check with an employment lawyer.
Joan Williams, Senior Talent Acquisition SpecialistFebruary 16,2023 at 8:01AM UTC
Why would you get every step in writing?
You mean to tell me that if I extend a verbal offer to a candidate for a base of $175k and 25% yearly bonus potential with a $10k sign-on bonus and agree on a start date, I need to verbally present that to the candidate, then generate and get approvals up the chain of command on a written offer letter containing all that information and then have the candidate say I want to negotiate some or all of these things, then generate and get additional approvals up the chain of command on an additional offer letter? Or multiple additional offer letters?
How many times do you think I should do that before this re-negotiating and generating offer letters and getting approvals from executives starts to paint the candidate in a bad light?
The only thing that matters is the final agreement that is arrived that. That's the information that should be contained in the written formal offer letter.
AnonymousFebruary 17,2023 at 2:00AM UTC
I think this is fair, but in this case there is the equity involved, so just asking for the information about that should be okay and it’s not asking for too much. If it was just base and bonus, that would far easier to just accept verbally. It’s not even a negotiation at this stage - but understanding a complex payment structure.
if I don’t know the details of my compensation, I’d be setting myself up for failure down the road.
Joan Williams, Senior Talent Acquisition SpecialistFebruary 17,2023 at 5:37AM UTC
I agree. But that's not the same thing as " Get every step IN WRITING."
AnonymousFebruary 17,2023 at 4:39PM UTC
That's fair - and I think my post might have come across the wrong way. I was keen to dive into the stock options document.
AnonymousFebruary 13,2023 at 6:49PM UTC
Without a detailed and written offer you are at a disadvantage because there is no way to capture the details.
AnonymousFebruary 13,2023 at 9:20PM UTC
Since it's such a complex payment structure, I would request a draft be given to you for review.
Barb HansenFebruary 13,2023 at 10:01PM UTC
Send the recruiter an email with what you wrote down, any thing that you missed asking them to confirm what you sent and update anything that's wrong or missing.
You can't be expected to agree to an offer that you don't have all of the details on.
AnonymousFebruary 14,2023 at 10:43AM UTC
So what the recruiter is saying is that he cannot generate the offer letter: with the terms of equity until he receives approvals. I generally know what is open, but the document will share more details about things I hadn't thought to ask. He's now asking me to confirm.
Crystal HowellFebruary 13,2023 at 11:47PM UTC
Something is not correct, go with your gut. Have you spoken to your hiring manager, they know the numbers. Don't sign anything until it is all in writing, stick to your gut. Think, if it's this confusing to get an offer, how will everything else be in the office????????
AnonymousFebruary 14,2023 at 2:59PM UTC
I am not a recruiter or an HM, but my gut and my experience tell me that there are no such things as "potential gains" from a stock option or an equity grant. I had nearly half a million in stocks tank to under $100K overnight, triggering margin calls that required me to liquidate the rest of my holdings. I lost most of my retirement savings on a stock with a history of gains in the double-digit percentages per year, so it made perfect sense to hold on to them. When corporate officers were caught by the SEC in stock price manipulation, the stock tanked to about 10% of the previous day's price overnight. The cash in the paycheck is what you should be negotiating right now. If bonuses are to be considered in the form of equity grants or stock options, those can be dealt with after the "paycheck" is nailed down. It sounds like you have a hard time accepting what they are telling you the base compensation will be, which is a good thing. That is the only thing with any guaranteed value going forward, so I would say go with your gut.
AnonymousFebruary 15,2023 at 4:38PM UTC
Sounds like a George Santos deal...
Anne KrookFebruary 14,2023 at 5:05PM UTC
The only job offer that counts is the one in writing. Make certain you get that. A recruiter may well try to discuss equity gains as part of total comp, but you should not assume there will ever be any gain from this. You should only base your assumptions about total comp from what is in writing. And for sure get an attorney in your country to look at the offer -- try if possible to find someone who has handled these issues for non-US-based employees of a US firm.
AnonymousFebruary 15,2023 at 1:07PM UTC
I just learned a hard lesson: GET EVERYTHING IN WRITING. If it is something promised, it must be in writing. They can and will go back on their word. For me personally, now I am stuck in a miserable job and have applied to well over 100 in the last couple months. I am trapped and extremely unhappy. Girl. Get. It. In. Writing. Always!!
GirlBossanova934974February 15,2023 at 1:35PM UTC
I have worked for a few companies offering equity and stock grants. Those things have to be put in writing and signed off on by the employer before they can be offered to you. You should keep in mind that those things are NOT guaranteed parts of your compensation. If the company does not do well, you are not going to receive those monies. IF that stock equity and grant money is a large part of the compensation package, you best think twice! If those items are maybe 5-10% of the compensation package, those are nice bonuses if you receive them.
AnonymousFebruary 15,2023 at 1:43PM UTC
I'd verbally counter, not including stock and equity in the total salary, since they aren't guaranteed.
rgstaffing@bellsouth.netFebruary 15,2023 at 1:44PM UTC
I don't know much about the kind of offer that you have but in my world, my client companies extend a verbal offer first and upon acceptance of that, they then send the formal offer letter which expires in 48 hours. Your recruiter should be able to go over the benefits with you but more than likely if you do not accept the verbal offer, they will not move forward with an offer letter. You should have recieved a lot of information not only on the interview but prior to the interview from your recruiter. In my world, if a candidate truly wants the job, the excitement will shine through,
Katherine Metres Akbar, Interview Coach & Resume ExpertFebruary 15,2023 at 1:45PM UTC
What is he asking you to confirm? It sounds to me like he's asking you to confirm that you provisionally accept the offer. He shouldn't need anything from you to generate a written offer to review. That said, you can negotiate based on a verbal or written offer if you wish to.
AnonymousFebruary 15,2023 at 4:24PM UTC
He wants me to agree on the numbers, but without understanding how the components worked fully, I was hesitant to agree and I also wanted to work out how to negotiate.
Katherine Metres Akbar, Interview Coach & Resume ExpertFebruary 17,2023 at 7:13PM UTC
I'm sorry--I'm just seeing this. But if you still want help on negotiating, I can provide you with a one-pager of guidance if you email me at katherine at YESwriting with the usual ending.
AnonymousFebruary 18,2023 at 3:28PM UTC
Thanks, I will consider this!
Leslie WoodFebruary 15,2023 at 1:56PM UTC
I am a recruiter but I don't work outside the US, so my advice is only somewhat helpful here but bottom line, get your offer in writing, along with full info on the benefits offered to you, as any cost associated with those will also be important to you. In many states in the US, an employer must present you with a written offer, and give you a certain amount of time to review it, 7 days for example. This is to avoid this very situation and to allow candidates to fully review their offer. Good luck, hope that helps!
Erika KlicsFebruary 15,2023 at 1:58PM UTC
This is a very common practice, and something I did for years as a former recruiter. We work the numbers out verbally and then get an exec to sign off on it. (Because in my experience, that exec sign-off can take a week, and sometimes when it goes back the exec says no...)Equity is part of total comp, but you don't have to look at it that way. If cash is important to you, just look at the cash component. And if you have questions about the equity, ask the recruiter to walk you through it or talk to someone who understands it well. You can still negotiate on a written offer in most places, but it's harder. (Now I work as a Job Search Strategist. I just had a client, for example, who landed an offer at Facebook and they said once it's written they can't go back. I worked with her to negotiate a 10K base increase before they went to get the written approved.)
AnonymousFebruary 15,2023 at 4:23PM UTC
Thanks. I mean, he didn’t tell me that - but I did assume that it would be more inconvenient, and honestly I just wanted to hash things out to save time on the written offer. But I need to see how equity works so I asked him for the grant letter.
AnonymousFebruary 15,2023 at 2:05PM UTC
Having to negotiate off of a verbal offer isn't uncommon. Including equity grant initial value in total comp isn't uncommon. Gains on equity don't count as part of your total comp, because losses don't either. That's just a risk of accepting equity as part of your comp as opposed to cash.
AnonymousFebruary 15,2023 at 3:26PM UTC
My advice would be to have your recruiter explain all of this to you clearly because after all, he or she is working for both you and the employer. The fact that you have to ask us questions because you’re not getting a clear answer from your recruiter is a red flag to me
AnonymousFebruary 15,2023 at 4:19PM UTC
I didn’t consider this, thanks for the perspective.
AnonymousFebruary 15,2023 at 4:33PM UTC
That sounds a lot like a dual agency situation. It happens in real estate. Some realtors are dual agents. The buyer and seller really suffer because the realtor is supposed to ride the middle of transaction not truly working fully for buyer or seller. To me that amounts to lack of fiduciary. Protect yourself. If you feel uneasy, or like it's a shady deal, listen to your intuition. When it's not in writing as initially presented, you suffer, not the company.
EMILY KIKUE FRANKFebruary 15,2023 at 3:44PM UTC
I'd advise that you say something a little generic, like, "Based on what I understand, this seems fair but I would like to be able to see everything in writing before I truly commit."
AnonymousFebruary 18,2023 at 3:27PM UTC
This is a great way to handle it - thanks!
Focused931221February 15,2023 at 5:34PM UTC
Always get it in writing. The recruiter wants to make sure the offer is locked in but until you fully understand what you are signing up for, you need to be able to clearly understand in writing. He should also understand that. What you don't want to happen is a misunderstanding and then it will make both of you look bad. Insist on getting the offer in writing in order for you to consider the offer. Best of luck!
Eloisa JacintoFebruary 15,2023 at 5:57PM UTC
Hi, I work in Compensation and it is fairly common at least in my experience (I’m outside of the US) for negotiations to happen during both verbal and written offers. You should not commit to anything until you have fully understood what is before you. Ask for plan rules of the equity and simulations of the gains. But yes, offers are usually done looking at total package ie base pay bonuses equities and even benefits. Especially for higher level positions, equities are deal breakers. Good luck!
AnonymousFebruary 15,2023 at 5:59PM UTC
There is absolutely no excuse for not putting an offer in writing.
misskelleypFebruary 15,2023 at 8:19PM UTC
Could you ask the recruiter to send you the presentation he went over with you? Tell him you're a visual person and need to see it in order to understand the totality of the offer. Also ask for clarification as to how equity works vis a vis taxation in your home country. Good luck.
AnonymousFebruary 15,2023 at 11:33PM UTC
Request for the offer letter. If it’s not in the offer letter, then it does not exist. It’s okay to discuss your salary and benefits, after you get an offer letter. If the employer values you, they will take time to explain what’s in it for you.
AnonymousFebruary 17,2023 at 2:02AM UTC
I think I just want more information on the equity and how it works at this point….the recruiter presented some figures to me but the whole barrage of terms with it is a lot to deal with.
AnonymousFebruary 16,2023 at 1:16AM UTC
So to answer all the moving parts. Yes, it is typical to get a verbal offer which is then verbally confirmed by you as a yes before going through the approval process. An equity grant has to go before the board for final approval and the amount that you get does not change once your offer letter is signed. If the company is in the US generally you get an offer letter NOT a contract (UK people get that as do some other countries- check yours) Not knowing how large or small or private or public the company is that you have this offer from I will assume its a bigger entity. Typically the verbal is given with the valuation of the stock grant at full vesting. That is so that you can see the total value from staying with them for the full usually 4 years that stock must vest. Things to find out- is the stock pre-ipo and if so what is the strike price at this time. Does it begin to vest immediately? Can they share the stock program documentation when you get the written version of the offer. The recruiter as an FYI is JUST the messenger and not the decisionmaker. No one will help you with any advice in terms of the taxation piece as they will not want in any way to be liable for giving tax advice. You should seek someone out in your country that can advise you. Another question is the recruiter a 3rd party external resource? If they are ask for a conversation with an internal person in the People/HR team to find out about other perks and benefits. Are you satisfied with the base pay? If you are not then you can negotiate up front but in this very competitive market I would suggest you really value the stock portion as that is where millionaires are made if the company is truly successful. Don't devalue that as part of the total rewards program they are offering.
AmyFebruary 16,2023 at 8:46PM UTC
I would say accept the verbal offer and that by no means locks you in to accepting the written offer. Even if you accepted the written offer you can always pull back if you find something better or that fits what you were looking for
Liz MilneFebruary 20,2023 at 5:23PM UTC
Don't sign anything until you have a very clear idea of what you will be getting in your bank account. Talking through something that complex just once sounds like something a conman would do, to be frank... Get at least a range in writing, and make sure the low end is acceptable to you