While some people are concerned about how the “No Salary History” law will affect hiring, the truth is that asking or not asking about salary really shouldn’t make a difference. It’s not going to make or break your recruiting process. In my opinion, there should be a law preventing companies from box-checking skills, experience, academics and salary history, too.
The reason: Asking these questions prevents companies from hiring diverse talent, top tier talent, highly motivated people and high potential people. None of these “must-have” factors matter. What matters is if the person is competent and motivated to do the work required and, if so, will do it for the salary being offered.
As a general recruiting rule, it’s always better to discover if the person is competent and motivated before discussing salary. This way you find out how talented the person is and if the open job matches before discussing his/her compensation needs. If the compensation doesn’t match but the person is talented, you’ll find another job for the person. Since you’ve done some relationship building with the person, you’ll also be able to connect on LinkedIn and proactively ask for referrals.
From a negotiating standpoint, if the job represents a true career opportunity, the salary range will become less important. For example, I just spoke with a “C-level” officer who was more than willing to take a 25% cut to get a job that didn’t require her to be on the road 60% of the time. She also gave me referrals for two director-level positions we were filling. These discussions would never have been possible if I asked about salary history first. When I was a full-time recruiter (for over 25 years), these types of discussions were daily occurrences.
So while filtering on salary is both naïve and unnecessary, so is filtering on the “must-haves” criteria, either before meeting the person or in the first phone call. It doesn’t take a lot of logic or persuasion to convince all but the naïve that if you can prove a candidate can do the work and is motivated to do it, he/she has exactly the amount of skills, experiences, competencies and education required. And if the person sees the job as a career move, the salary being offered is exactly what it needs to be.
This table provides the factors we’ve seen best predict on-the-job success:
You’ll be able to assess most of them by digging deep into the person’s accomplishments related to the performance requirements of the position. This short video lesson describes how to score the candidate on these factors. This post describes the two questions you need to ask to prove the candidate is both competent and motivated to do the work.
Sometimes candidates ask about the salary before they even know if the job represents a significant career opportunity. This also makes no sense. Even if the job initially being discussed is not a fit on salary and opportunity, there might be something else available that is.
So when candidates ask me this question, I say the compensation doesn’t matter if the job doesn’t represent a true career move. Then I suggest we first determine if it does and then we’ll see if the compensation is a fit. The recruiting principle underlying this approach is to shift compensation from a filter to a negotiating factor by first determining if the person is performance qualified – meaning he/she can do the work – and, if so, if the job represents a career move.
When I find candidates who meet this dual criteria, I just ask about their salary needs. If they see the job offering as a better career move than their current position or others they’re considering, their requirements are typically pretty reasonable. If they’re too high, I ask if they’d be open to consider it with a much more modest increase if it was offset by a more significant job with more growth and more satisfaction. Few people opt-out at this point.
No one needs to filter candidates on salary history or by a laundry list of skills and experiences. Prohibiting all of these factors would be a better law since it would open up the talent pool to the truly qualified. You won’t even need to filter out the unqualified since they’ll self-select out by simply asking interested candidates to write up a few paragraphs about what they’ve accomplished that best fits the performance requirements of the job.
While this is a different approach, I asked a top labor attorney from Littler (one of the top labor law firms in the U.S.) to validate it as part of my book, The Essential Guide for Hiring & Getting Hired. Here’s a copy of his whitepaper, but his summary comments pretty much say it all:
By creating compelling job descriptions that are focused on key performance objectives, using advanced marketing and networking concepts to find top people, by adopting evidence-based interviewing techniques, and by integrating recruiting into the interviewing process, companies can attract better candidates and make better hiring decisions.
Because the Performance-based Hiring system does differ from traditional recruiting and hiring processes, questions arise as to whether employers can adopt Performance-based Hiring and still comply with the complex array of statutes, regulations, and common law principals that regulate the workplace. The answer is yes.
Recruiters need to become advocates for improving quality of hire. Unfortunately your ATS vendor is holding you back.
Advocacy starts by recognizing that there are two talent markets. One targets candidates who are willing to take lateral transfers and endure the demeaning nature of the traditional hiring process. This is the job market. It’s about volume, speed, avoiding mistakes, and efficiency. But it comes with a cost: It puts a lid on quality of hire. The ATS vendors have built their systems to efficiently process all the data management requirements of this job market.
The other market targets strong people who are interested in career moves. This is the career market and it’s the key to improving quality of hire. The process used to hire people in this market – and this is a bigger and more talented group – is much slower, more intense and more competitive. Some ATS vendors have begun addressing these differences, but I believe recruiters need to push them to accelerate their efforts. With this in mind, here are some ATS product design ideas that actually will improve quality of hire. (Contact me if you’re interested in learning which ATS vendors are moving in this direction.)
1. Implement a “Scarcity of Talent” strategy.
This strategy involves attracting people in rather than weeding them out. This requires that the UX (User Experience) for the career path option is based on how the best people change jobs. One big difference: Most people will be open to discuss the potential of a job switch if it represents a career move, but this is a much slower give-and-take process.
2. Don’t force candidates to apply.
Instead, offer people two options: one for careers and one for jobs. Eliminate the apply button for the career path option. While the career path is slower and requires a persistent recruiter and a fully-engaged hiring manager, time to fill and cost per hire is the same since you’ll be spending more time with fewer people.
Be overt about this. As you begin your discussions with those in the career market, tell them that a career move is the sum of a bigger job, faster growth, more satisfying work and more important work. Some candidates will balk at this, wanting to know the compensation right away. Tell them it won’t matter if the job isn’t a career move.
4. Redefine the job description.
The 30% non-monetary increase is determined by comparing what you need done and where the job could lead, to what the candidate is now doing and where he or she is going. That’s why you need to develop a performance-based job descriptionthat defines the core challenges in the job and the upside potential to make the comparison. This step is the tipping point for opening the door to more top tier prospects.
5. Consider the job posting marketing collateral.
Do not publish your internal skills, experience and competency-laden job descriptions for either market. There is no law requiring you to do this! Published job postings need to describe compelling customized career moves without the generic boilerplate. You’ll push your referred and direct sourced prospects to this posting to get them to instantly see the career opportunity inherent in your opening.
6. Let candidates disqualify themselves.
Your new compelling postings will attract a lot of people who are unqualified, but you can add a simple pre-step into your process to eliminate these people. As part of this, require interested prospects to submit a half-page write-up of a major accomplishment most related to the big challenge in the job instead of a submitting a resume.
7. Shift to a “small batch, high touch” process.
Done properly, you only need 10-15 direct sourced candidates and 3-5 referred prospects to hire one great person. The key is to cherry pick the people you target using “Clever” Boolean to pre-select people who would naturally see your opening as a career move. For example, an award-winning marketing manager at a big company would be open to discuss faster career growth at a mid-size company.
8. Metrics really matter.
Since you’re dealing with just a few people, you need to track why people aren’t responding to your messages and why they opt out. This instant feedback is critical for both process control and process improvement. As you’ll discover, most people opt out before fully understanding the 30% career move opportunity, or never engage in a conversation because it wasn’t clearly spelled out in your messaging.
9. Measure Quality of Hire pre-hire.
This Talent Scorecard measures quality of hire pre-hire using my two-question Performance-based Interview. The key is to evaluate the candidate’s major accomplishments most related to the performance objectives of the job. This is comparable to a pre-hire performance review. You need to measure quality of hire for every hire to ensure your process is actually improving quality of hire. If not, start over again with step one above.
If you look closely, you’ll discover that this “career” process is comparable to the one that’s historically been used to find and promote people internally or rehire people you’ve worked with in the past. It’s not a big leap in logic to suggest that you should find and hire people you don’t know the same way. What’s surprising is that the ATS vendors built a process to efficiently hire strangers at scale. It’s time recruiters and hiring managers stand up and fight for a better point of view: Hire for quality, not for cost or efficiency.
Take a look at this image:
This represents the total talent market for any given job. The “A” represents a small group of qualified prospects, mostly passive -- about 25% of your prospect talent pool. Most will call you back right away because they were referred. Most of the rest will call you back because they see your opening as a possible career move.
These are the prospects I call “Recruiter’s Gold.” And, it takes some skill to find these golden nuggets. Before we dive into how to find them, lets consider the other groups of talent.
The breakdown of talent tiers
As you examine the treasure map, note that the best prospects are represented by the blue upper quartile. The teardrop represents the typical distribution of people who apply to a job posting. Note that just a few are in the upper quartile.
Group 1 represents a subset of applicants who possess all of the criteria on the job description and have been filtered on compensation, location and title. Rarely will you find A-level talent responding to a job posting for a critical job.
Group 2 represents candidates who have been direct sourced (searching through resume databases like LinkedIn and contacted via email) using Boolean in combination with LinkedIn Recruiter’s filtering system. The reason this group isn’t comprised of more top quartile candidates is that they have been selected based largely on their level of skills and experiences. Given this as the criteria, few top people respond to the messaging since they’re not interested in considering jobs that represent lateral transfers.
Group 3 represents a highly talented group of direct-sourced candidates. The reason there are more top tier prospects in this pool is that the search criteria used to find them is based on performance qualifications and achievement terms, not skills and experiences. As important, when the messaging emphasizes career growth and an opportunity to discuss the opportunity rather than applying directly, response rates are far higher.
Group 4 is the “Recruiter’s Gold” group of prized candidates. They’re preselected, highly referred and performance qualified prospects who would see the job as a career move. The reason they’re golden is that they always call you back.
How to recruit the top 25% of the talent market
Given the above treasure hunting guidelines, I suggest recruiters implement a 40-40-20 sourcing plan. Basically this suggests spending 40% of your time networking to get names of gold tier candidates, spending another 40% of your time direct sourcing performance and achievement qualified candidates and spending the remaining 20% writing job postings and recruiting messages that will appeal to gold tier candidates. The reason the postings are important is that you’ll drive all of your direct sourced candidates to these jobs so they need to be compelling.
While all of this sounds great, these four tipping points represent the difference between success and failure:
1. The big shift
You must get the hiring manager to shift from a skills and experience qualification criteria to one based on performance, achievement and potential. Performance qualified means they can do the work. The big point of this is that if they can do the work they must have all of the skills necessary or learn them quickly, but often this is a different mix than what’s on the job description.
2. Guerilla marketing
You need to use a multi-pronged marketing campaign to get at least 50% of the Group 3 direct sourced candidates to respond to your message. This requires a combination of emails, tweets, videos and voicemails that are customized for the job describing compelling job-branded opportunities.
3. The 30% solution
Once on the phone, recruiters must convince more than 50% of the Group 3 and Group 4 people who respond that the job represents a career move. If the job turns out not to be a good fit, the recruiter needs to obtain at least one referral of another gold tier prospect.
It’s important to tell these prospects that a career move requires a minimum non-monetary increase of at least 30% consisting of some combination of a bigger job, faster growth, more impact and a richer mix of more satisfying work. This is often all that’s needed to get the person to explore the opportunity.
4. Networking wizardry
It’s easy to get great referrals from your co-workers. Just proactively search on their connections for top tier people and ask if the person is worth contacting. You can use the same approach with any of your first degree connections and those Group 3 prospects who aren’t perfect fits. Just connect with them and search on their connections and also ask, “Who’s the best person you’ve ever worked with doing this type of work?”
There is golden talent out there. However, you need a great map and a skilled prospector to find and recruit them. If you’ve ever worked with a gold tier person you know it’s worth the hunt.