The Other Side of the Negotiating Table

Salary negotiations are often discussed from the perspective of the person negotiating their own pay. But managers also have these conversations on behalf of their team members, usually with HR, their department head or even the senior management team.

It might be about a software developer who has received an offer from a competitor. Or a team leader in Controlling who has consistently exceeded expectations and taken on additional responsibilities for three years without receiving a pay rise.

Many of these conversations fail to achieve the desired outcome. Often, this is because managers slip into the role of advocate and lose sight of the actual decision-making criteria. Here are five key steps to help change that.

1. Understand the Constraints

An initial 'no' rarely reflects an employee's value. Instead, it usually reflects the constraints of the system in which the decision-maker operates.

Three factors often come into play simultaneously: the annual merit increase budget, the salary band for the role and the need for approval from senior management.

The first question should therefore be: What is preventing this decision from being approved?

If the budget has been exhausted, a one-off payment or an adjustment in the next review cycle may be an option. If an employee has reached the top of their salary band, a pay rise may require a new role or a higher grade. And if the necessary approval is missing, you may simply be speaking to the wrong decision-maker.

2. Set the Right Priorities for Salary Increases

Often, there is enough budget to increase salaries for a small proportion of the team, but not for everyone. The key is to allocate pay rises based on objective criteria.

A straightforward assessment matrix with four equally weighted criteria provides a reliable basis for these decisions:

• Gap between current salary and market rate
• Importance of the role
• Performance development over several review periods
• Risk of employee turnover

Each criterion is scored from 1 to 5. Employees with the highest total scores are prioritised for salary adjustments.

This creates a clear order of priority that can also be explained transparently to HR or departmental management.

3. Build a Compelling Business Case 

Once internal priorities have been established, the next step is to negotiate with the relevant decision-makers. Simply saying 'She does an excellent job' is rarely enough. To secure a salary adjustment for a team member, managers need to demonstrate not only the employee's achievements and contribution to business success, but also the potential cost of doing nothing. This is where replacement costs become particularly relevant, yet they are frequently overlooked.

According to the US-based Society for Human Resource Management (SHRM), the cost of replacing an employee can range from 50% to 200% of their annual salary, depending on seniority. For someone earning €70,000 a year, that amounts to between €35,000 and €140,000. Recruitment advertising and agency fees account for only a small proportion of these costs. The rest comes from the time a position remains vacant, onboarding and training a replacement and the institutional knowledge that leaves with the employee.

4. Make Your HR Business Partner an Ally

Many managers only involve HR when a decision is about to be made, treating the HR Business Partner primarily as a gatekeeper. In reality, they are often the person best placed to identify a viable route forward. They know the salary band for a particular role and where the employee sits within it. They are familiar with comparable cases and the risk of setting a precedent. They also understand which options are likely to receive approval in the current review cycle, whether that means an exceptional salary adjustment, a one-off payment, an accelerated review or a move to a higher job level.

The question should therefore not be 'Is this possible?' but rather 'What would be the best way to achieve this, and what do I need to provide to make it happen?'

5. Have an Honest Conversation with Your Employee Afterwards

The conversation with the employee following the negotiation is just as important as the negotiation itself. When the outcome is disappointing, it can be tempting to soften the blow with promises such as 'I'm sure it'll work out next year.' But statements like these only postpone the problem. A better approach is to be clear about what has been achieved, what has not and exactly when the issue will be revisited, ideally with a specific date.

Shifting the blame to senior management is not helpful either. Saying 'I fought for you, but the people at the top...' does little to move things forward. Instead, it is worth exploring what might be possible without additional salary budget approval. This could include a professional development budget, a certificate programme or greater responsibility for high-profile projects.

Conclusion: Fair Pay Is a Key Leadership Responsibility

Ensuring fair pay within a team is rarely taught as a leadership skill and is often overlooked in leadership guidelines. Yet it should be a fundamental part of every manager's responsibilities At least once a year, managers should review their team's salary structure using the assessment matrix outlined above and take proactive action where necessary.

At the same time, realistic expectations are essential. When hiring freezes and cost reductions are the priority, even a strong business case will not always succeed One pattern is particularly striking: many managers negotiate far more confidently on behalf of their teams than they do for themselves.

For those looking to change this and develop their negotiation skills further, the Frankfurt School Alumni Association is hosting an online session in English, 'Know Your Worth. How to Successfully Negotiate Your Salary', on 20 October 2026. The session will cover how to assess your market value, use the salary square framework and respond effectively to common objections. You can register on the Frankfurt School Alumni Association's event page