offer-compensation-negotiation

---
name: offer-compensation-negotiation
description: "Build compensation bands, design offer packages (base, bonus, equity, benefits), plan negotiation strategy, and draft offer letters. Use when the user asks to create salary bands, make an offer, handle counter-offers or negotiation, price a role, or write an offer letter."
---

# Offer, Compensation & Negotiation

## Purpose
Close candidates with fair, internally-equitable, market-aligned offers — and handle negotiation without overpaying or losing the hire.

## Compensation band design
1. Define levels (from leveling framework) → per level set band: min (80%), midpoint (100%), max (120%).
2. Anchor midpoint to market percentile (P50 typical; P65–P75 for scarce skills) using survey data (Radford, Mercer, Levels.fyi, local surveys — always date-stamp the source).
3. Position-in-range rules: new hire typically 80–110% of midpoint depending on experience; >110% needs exception approval.
4. Review bands annually or when market moves >5%.
5. Internal equity check: new offer must not invert existing team pay (compa-ratio comparison vs peers in same level/location).

## Offer package components
- Base salary (within band, documented rationale)
- Variable: bonus target % + metrics, or commission plan
- Equity (where applicable): amount, vesting (4y/1y cliff standard), strike/grant price, refresh policy
- Benefits summary: insurance, leave days, allowances, remote budget, learning budget
- Sign-on bonus: use to bridge lost unvested comp — with 12–24 month clawback clause

## Negotiation playbook
- Never lowball expecting to negotiate up — damages trust and acceptance rates.
- First offer = best credible offer within band, with room ≤5% for one move.
- Negotiate the package, not just base: equity, sign-on, remote days, title scope, start date, review-at-6-months clause.
- Counter-offer handling (candidate's current employer matches): redirect to non-comp factors — growth, scope, manager, mission; >50% of counter-accepted employees leave within a year anyway.
- Deadlines: give 3–5 business days, never exploding offers <48h.
- Walk-away discipline: exceptions beyond band max need compensation-committee sign-off and documented reason.

## Deliverables
- Band table (levels × min/mid/max, currency, location adjustments)
- Offer letter draft (legal review required before use; include at-will/contract terms per jurisdiction)
- Negotiation brief: candidate motivations, levers ranked, walk-away point, approval chain
- Internal-equity impact note