In the original post Patrick already touched on the Japan case, but one thing I'd add is that one of the pieces of paperwork you must hand to your new employer is your final tax slip from your previous employer showing how much tax you have paid in the current year. From there it's trivial to calculate your previous salary.
There are ways around it but it seems most people go with "my base was XX.... and that's one of the reasons I'm out there looking to change jobs."
"...one of the pieces of paperwork you must hand to your new employer is your final tax slip from your previous employer showing how much tax you have paid in the current year..."
Are you referring to Japan?
I've worked in two states in the USA and never been required to produce such documentation.
I've always had to do that in the UK. Your previous employer gives you a form called a P45 when you leave that has information about your tax code and your earnings for the previous year.
The new employer just needs your details to identify you correctly with HMRC.
You can give them sufficient detail without handing over your P45 or income data. I have never given a P45 to a new employer and it has never been a problem.
It's possible that your tax code will reveal some information, if you're still in the same financial year, but this is an unreliable way of calculating salary.
Correct. A difference for the UK is that salary bands are often (not always) disclosed in an advertisement or told to a head hunter in advance. Not always, but enough that not doing so raises eyebrows and concerns about corporate ethics for me (and my friends).
The obvious caveat in this is that they could only estimate an average salary. You could state that your salary progresed rapidly during your previous employment, although they may not buy it.
> your final tax slip from your previous employer showing how much tax you have paid in the current year.
Do you mean in Japan or the US? Because you certainly don't have to do that in the US.
> From there it's trivial to calculate your previous salary.
And even if you did do it in the US it would be impossible to calculate your salary from it because it depends on how many exemptions you claimed in your W4 (which you can change at any time - it doesn't have to be how many children you have, it's basically a number to fine tune how much tax you pay so you don't overpay and need a refund).
IANAL, but I don't see why that would be illegal. There are very few things that it's actually illegal for an employer to ask about. (Though it would obviously be a bad idea to ask a candidate about their status in a protected class, it's not technically illegal to ask.)
That said, this is a bad idea because it would scare off plenty of people who aren't bluffing about their salary (like me). And there are already employers who will terminate you immediately if they discover you lied in your job application.
> There are very few things that it's actually illegal for an employer to ask about.
I guess it depends on your definition of "very few things" but this list[1] of Unlawful vs. Lawful questions seems pretty long/wide ranging. And I know that the small business I worked for violated it on a regular basis. I actually had it sent out to each person who does interviewing (since the company didn't have a formal policy on training someone for interviews) so they knew what was/wasn't acceptable.
Note: I'm not a lawyer so don't take this as legal advice.
My understanding is that it is illegal to use any of those things to discriminate against someone for purposes of hiring. It's not technically illegal to ask the question, but if you do, and you don't hire the person, have fun in court trying to prove that you didn't hire them for some other, valid, reason. So don't ask them, because there's no upside in it for you.
They can't legally ask for proof, no. Bluff away! (I'm not a lawyer and this does not constitute legal advice.)
I did a small bluff to try it out, just 5k above what I was making. The recruiter was surprisingly skeptical! I know I've done an good job of bumping up my salary in a short amount of time, but it was kind of off-putting to have him question it.
I'm a bootstrapped entrepreneur CEO with ~30 employees in my company now, growing quickly, expect to have ~60 in next 12 months.
I am not so interested in previous salary. Rather, I always directly ask "what is your salary requirement". I think it is good business sense to not underpay what people think they require, though sometimes this means we must pass on what could otherwise be good employees, so requesting moonshot salaries is definitely a filter for us.
Furthermore, when I ask applicants their requirement, if they just deliver a number to me using logic that does not include salary levels at previous jobs to justify, then I evaluate how close it is to my budget target for the position, and if feasible, I make an offer at that requested level.
However, if the applicant uses a previous salary to justify their current salary requirement, and it's a lot higher than I expected or had targeted for the position, I have on a few occasions offered jobs with compensation to match previous salaries, so long as applicant proves to my HR they are not lying about the salary.
So far, all offers I’ve made predicated on proving their salary claims, my HR has proven the applicants were lying to significant degree, except for one person. Those that were caught lying had job offers rescinded. The one person that wasn't lying only lasted 90 days because he clearly couldn’t add value to justify.
From my point of view, the best strategy for negotiating a higher salary is to get in front of a person that cares if you can help them make them more money than it costs to pay you, regardless of your previous salary (an HR manager is usually not the person that cares about this). Then present a clear vision to them for how you will deliver that added value.
If you are asking me to start a negotiation and I give too high a number for your tastes, that isn't my fault, it's your fault for not just offering what I'm worth to you. How am I supposed to know what you consider to be a moonshot?
Above a certain point, and most programming jobs are above that point, there is no fixed position with a fixed value. The right person in the right place can easily be worth 2x or more than originally anticipated for an opening. There's no way to predict that in advance, so at best the employer could give an ideal range and let candidates demonstrate their value if they want to exceed the range.
One of the things I've always tried to be aware of is how much value I add to a business. Dollar figures help most, but some places are wary of giving developers that knowledge, though it's usually not difficult to work out. This has helped guide my salary requests in a way that I hope is fair for all parties; rising tides lifting all boats, and that sort of thing.
Don't let their skepticism thrown you off. It is just another technique to low ball you.
In my own interviews going out of collage, I was told by peers about the offers they were making. I got asked what I was expecting to get by employers and told them around $80K because thats what my peers were getting and I consider myself to be on pretty equal ground with them and most companies scoffed at it. But then I got an offer of $95K and then they had to raise their own offers up to match. Its a ridiculous process to go through.
> They can't legally ask for proof, no. Bluff away!
Well, I am a lawyer, and this is also not legal advice.
To lie and accept a job offer whose salary is predicated on the lie would constitute fraud. Lying about your former compensation history is no different than lying about a prior criminal record, if the counterparty relies on the false assertion.
A very good point, but, and this gets a bit complex, they would have to prove that they relied upon on false information to decide to hire or pay you.
So Bob and Anna are equally qualified and currently paid 50k. They both apply for same job and Bob says he has a (fake) PhD and is paid 50k and anna does not lie about qualifications but says her base is 100k
Most of us would say Bob has committed an illegal act because the link between qualifications and hiring decision seems so clear. But there is a very weak link between previous salary and hiring decision, so how far must the company prove that it uses prior salary in hiring decisions? Just the fact that it asks? The fact it only offers prior plus 5%? That prior salary is used to rank CVs?
Unless current employer a) receives your permission to pull your tax return transcripts or b) receives your permission to contact your previous employer and you provide permission for previous employer to divulge said information, you will almost surely not be found out.
Disclaimer: Not a lawyer, not your lawyer, but fairly confident based on past experience with this over ~15 years.
You can triple-dog-dare an employer to fire you "with cause" from a role where you are performing well for lying about previous salary. This is a silly concern. It's just not going to happen.
This is what happened in my last negotiation, where $X was a 30%-ish raise. They didn't bat an eye, and made an offer of exactly $X. I asked them, "Could we make that $(X + .06*X) and they did.
I keep raising my rates 30% every time someone asks, mainly because I don't want to take on more work, but apparently people don't mind, so I keep getting more work... Oh, the humanity.
I suppose so? If I was a recruiter I wouldn't question what I thought was a 5k discrepancy. I was doing well though--- making 90k after 3 years of programming, and my bluff was 95k. I think that just the real salary alone would have been enough for him to raise suspicions.
Depends on the area, I guess. I don't think people would have blinked in SF or Boston at that.
Or he was screwing with you to try to drag down your ask. Happens pretty frequently, because their incentives don't align with yours (it's the realtor problem all over again).
While dealing with recruiters can be a hassle their goals align much more closely with ours if we are maintaining the fallacy that only the money counts. Recruiters are typically paid a percentage of your salary so they want you to receive the highest salary possible since that is the best payout for them as well.
My experience with recruiters is they want to know how little it will take for you to accept the job, but this is because they need to know which jobs they should do the legwork on.
If I'm looking for a job I call up several recruiters I trust and I tell them the specifics I'd what I'm looking for and the price I'm willing to accept. I then continue working my network and looking on my own, but now I have 4 times as many jobs and a better chance if finding the perfect fit.
> While dealing with recruiters can be a hassle their goals align much more closely with ours if we are maintaining the fallacy that only the money counts. Recruiters are typically paid a percentage of your salary so they want you to receive the highest salary possible since that is the best payout for them as well.
No, this isn't true, and this misconception is explicitly why I invoked the realtor problem. If the recruiter gets paid, say, 15%, the difference to the recruiter between $100K and $110K is $1500. To get $16,500 instead of $15,000, the recruiter risks extra days of negotiation in which the applicant may find another job, or one or both sides passing on each other because of lack of salary fit. In most cases, then, it is in the recruiter's best interest to pressure you to take the job at $100K. Most recruiters are out of the business in a couple years, only a few are in it for the long hall--since he's not going to work with you again, it's in his best interest to get the payout now. Over any length of time, they will make so much more money by you saying yes than you pushing for more money that it's stupid of them not to get you to take the first offer that comes down the pike.
A few recruiters, among them the best ones I've worked with, are in it for the long haul, and cultivate real relationships, but they are uncommon. I remain on good terms with them whenever I can--I've been on job interviews before where I was clearly sent to the wrong job and told the interviewer "look, you don't want me for this job and the recruiter just wasted your time and mine--go talk to this guy, he'll feed you candidates you can actually use." It's worth it, because what goes around comes around, but most are in-and-out and they act like it.
I think we are essentially in agreement here. I said that recruiters goals more closely align than realtors, but I need to clarify. While a realtor can represent us in either the purchase or sale I'm considering representation of a purchase. Here the realtor's goal is directly at odds. I want to purchase the house as cheaply as possible, but the realtor wants the largest commission so they want the price to remain as high as possible.
The recruiter wants the largest commission possible and I want the highest salary possible. Notice I said these "more closely align". You are right, it is not a perfect alignment. The recruiter would rather get some commission rather than none. If they are afraid you may take an offer on your own or from another recruiter they may try to get you to accept a lower offer. This is why I work with recruiters I trust and I establish clear non negotiable guidelines up front. "I am looking only for promotional level opportunities. My current salary is X; do not trouble me with positions unless the salary is paying a minimum of X + (X * .3)".
With this type of relationship we must establish clear guidelines. If we fail to stick to those guidelines then it is on us.
One wonders why the incentives aren't aligned. I.e. the value of the recruiter to the employer is finding a higher paying job, so the compensation should reflect that. E.g. 10% + 50% of the pay increase.
The value of the recruiter to the employee is that. The recruiter isn't being paid by the employee. You could consider an agency model, but honestly I don't think that's likely to actually work because of the temperament of the developers in question.
We regularly get requests for job title/tenure/salary verification forms from former employees. I'm not sure what our status on completing them is though, but there are at least some companies out there that go through the legwork to check up on something after a job offer.
If you have a corporate lawyer and/or experienced HR director, you do the same thing everyone does: inform the questioner of the individual's dates of employment and nothing else.
Only if that employee has the time and money to waste on the lawsuit, and has any evidence in hand to make it go. How is that employee supposed to discover this? By fraudulently pretending to be a prospective employer?
You certainly shouldn't share your salary, much less provide a W2, for most positions. However, not only is it not illegal to ask for a W2, for most sales positions it is the norm.
The reason is that sales people make most of their money on commissions in most places, and checking how much they made in commissions in previous years is the simplest way to figure out how effective they have been in past positions.
There is an altogether separate discussion about whether commission heavy compensation works better or not though.
[1] http://www.nytimes.com/2001/04/05/business/stinging-office-m...