2597: Salary Negotiation

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Salary Negotiation

Title text: "We can do 0.33 or 0.34, but our payroll software doesn't allow us to--" "NO DEAL."

Explanation

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Ponytail's company would like to hire Cueball for a job, and she is telling him that their offer for his starting salary is $55,000.

When offered a new job, it is common to negotiate on aspects of the offer such as salary, and employers may offer below the market rate initially in the expectation that the final negotiated amount will be higher. Given that the bedrock of one's future income depends on the outcome of a one-time process requiring skills unrelated to the job one is hired for, it is advisable to take one's time and do as much research as possible.

Cueball realizes that he has ended up in this situation, but, in typical Randall fashion, he states the fact, saying out loud Wow. I guess I'm inside a negotiation! Ponytail comments that it's a weird way to phrase it, and would then probably have continued to say, but that is correct. Cueball, however, interrupts her by stating that I can do this.

Cueball has clearly done some research, but perhaps too much as he is flummoxed by this high-stakes situation and starts to ramble with decreasing coherence. First he gets completely confused about the numbers. He might have said I won't accept a penny below $60,000, starting out by putting a bit more on, letting now, that this might not even be the lowest he would accept. Instead he says he won't have a penny over $50,000, thus cutting $5000 of the initial offer, and saying he will not have more than that. He realizes this was completely wrong, and corrects to under, but is still 5000 lower. Then he continues to mess up the numbers. Clearly he meant to go for $60,000, but first says $60 then $600, 100 times below what he wishes to say. Then adds the word Thousand after a short break, and continues to say it as one word $600,000. That is of course 10 times more than he wished to try for.

Realizing that he is completely off he asks for "15% cut of the salary". Here, Cueball seems to confuse salary and commission. "X% cut of the salary" seems like what a recruiter/headhunter may get from their employer as a commission if they successfully make their person hired. This is not the phrase to be used when negotiating a salary, as is the case for Cueball here, since it's not commission based.

The next word he says is Raise. This could make sense if he already had a job, and wished to negotiate for a pay raise. But that is not the case. After this, he begins to think of raise as in a card game and starts rambling off mainly poker related terms, like raise, fold and pass. He throws in double down in between. This can also be a card game term, as in blackjack where double down means to double a bet after seeing one's initial cards, with the requirement that one additional card be drawn.

But in everyday speak, in a fairly dramatic rise in popular usage, to double down is to take a further risk in a situation or passionately re-commit one’s efforts to a cause or course of action despite clear and contrary revelations. This could make a limited amount of sense in a negotiation situation in which one is trying to establish the necessary self-worth. But of course not in Cueball's ramble, that finishes with him saying Fill it up with regular, something you would say at a gas-station, where they still had an attendant to operate the pumps. Likely something Cueball has only experienced when watching old movies...or territories and states where mandated by law.

At this point Ponytail tries to ask him something. Maybe, Are you OK?. But again Cueball interrupts her, saying he is sorry and that he would like to start over. At this time he takes out several sheets of paper and looks at some charts. But the charts are not clear enough, or only have a suggestion for what percentage he should ask for. He asks if he can borrow a calculator (something he would likely have on his smart phone) and then asks what's 20% of $55,000. This last bit seems like he is finally following a common advice^{[citation needed]} to take the initial offer and add 10-20%. That would be $11,000, so it would have been $66,000.

Once more Ponytail tries to give him some time to think, but once more he interrupts, as he eventually have settled on a number, $61,333.333.... He even states that the decimals of 3 should be repeating, as in forever. Thus exactly $61,333 + $1/3. He clearly states he will not take the job for less than that. The value he settles on is 11.51515...% larger, or exactly ¹⁸⁴⁄₁₆₅ times the asking price, closer to 10% than the 20% he just asked for. In classic Cueball style, he has made the simple problem sufficiently complex that one must wonder how he got there. However, the value does still fall within the band suggested by the common advice. A 2016 Harvard Business School study found that avoiding round numbers is a remarkably effective negotiation tactic.

Since this is not that much more than the starting offer Ponytail is ready to accept this and says Sure, $61,333 is fine. She is once more starting to say something, like That's actually a reasonable request, or That's actually within our limits. But for the fourth time Cueball interrupts her, this time almost yelling Point 3 repeating or I walk! Because what she just offered him was $1/3 less than he asked for, and thus more than a penny less.

This last outburst is just plain ridiculous as this would only lower his asking salary by 5 parts in a million. And for certain Ponytail would accept going to $61,334.^{[citation needed]}

In the title text it shows that this is not good enough. Cueball has now confused himself to the limit that he will not only not accept less than his asking salary, he will also not accept more. So when Ponytail tries to explain to him that the point 3 repeating cannot be paid in whole cents, and tries to let him know that their payroll software only can handle whole cents, and he thus can get either 0.33 or 0.34 (the latter actually being more than he asks for), he again shout out NO DEAL.

Since Ponytail cannot pay him out in a number with infinite decimals (1/3, pi or any other kind)^{[citation needed]}, it seems Cueball will let this job slip out of his hands, because he has completely misunderstood the concept of negotiation.

The situation could be resolved if he would be happy with an arrangement such as a leap cent every three years, but maybe Ponytail would at this point realize it was probably a mistake to hire such an easily confused person, and happily let him go.

This can be read as a cautionary tale about taking time to compose one's thoughts before responding to a situation. The confusion caused by the wad of papers also reminds us that more information does not necessarily mean more clarity.

For more interview-related xkcd comics, see for instance Category:Job interviews.

This could also be taken in series with Cueball (possibly as a stand in for Randall) misunderstanding classically "adult" ideas, see for instance 616: Lease, 905: Homeownership, 1674: Adult and 1894: Real Estate.

Transcript

[Ponytail sits in an office chair at her desk, with Cueball sitting in a similar chair on the other side with his hands on his knees. Ponytails has her hands on the desk and in front of her, there is a slim thing standing up. It could be a very small screen, but there seems to be no keyboard in front of her. Maybe it is a small tablet with a support for letting is stand up. Behind that there are what appears to be two piles of papers of different sizes.]

Ponytail: We'd like to extend an offer! The starting salary is $55,000.

Cueball: Wow. I guess I'm inside a negotiation!

Ponytail: I... Weird to phrase it like that, but-

Cueball: I can do this.

[Zoom in on Cueball's upper half.]

Cueball: I won't accept a penny over $50,000. Sorry, I mean under. Under $60. I mean, $600. Thousand. $600,000. I want a 15% cut of the salary. Raise. Double down. Fold. Pass. Fill it up with regular.

[The same shot, except Cueball is now holding three pieces of paper, and he is looking down on them. Ponytail is talking to him from off-panel.]

Ponytail (off-panel): Are you-

Cueball: Sorry, sorry. Let me start over.

Cueball: OK, my chart says...

Cueball: ...Can I borrow a calculator? What's 20% of $55,000?

[Back to the scene from the first panel. Ponytail has taken one hand down to her knee, with the other still on the desk. Cueball has put the papers on his lap and has raised his hand in the air holding one finger up. In his other hand he holds either a borrowed calculator or his own smartphone.]

Ponytail: Listen, if you need to-

Cueball: I won't take this job for less than $61,333 point 3 repeating!

Ponytail: Sure, $61,333 is fine. That's actually-

Cueball: Point 3 repeating or I walk!

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Discussion

The second panel is me every time I haggle for something, and I have to make sure I don't end up haggling the wrong way. Or starting above my desired price when I mean to start below so that I can meet in the middle at my desired price.

172.70.91.36 23:06, 23 March 2022 (UTC)

It's not a one-time negotiation, anyway. During an annual review I'd have to suggest any pay adjustments. Was useless at it, too self-effacing. I left one job after ten years and later on found my exact same old position (which I had felt now wasn't adding much to the team, part of the reason I left) readvertised with a suggested salary range starting at twice that of what I had actually departed with. Seems they needed me (or someone quite like me) more than any of us knew. That experience didn't improve my assertiveness, though. 172.70.90.211 10:25, 24 March 2022 (UTC)

They should offer him $61,333.33 plus a penny extra once every three years.162.158.107.198 23:31, 23 March 2022 (UTC)

The way a friend solved it was to cut a penny into six pieces (like a pizza), and then give me two of them. Ruffy314 (talk) 09:42, 24 March 2022 (UTC)

This raises more questions than it answers. Why was your friend giving you 1/3 of a penny? Why two sixths rather than one third? How did they cut it? --192·168·0·1 (talk) 13:34, 24 March 2022 (UTC)

I would imagine that it is significantly easier to slice a coin all the way through than it is to cut it halfway through. But I'm still wondering how: after making the first cut (presumably relatively easy given the right tools), the subsequent cuts would be against *parts* of a penny, not the entire thing (thereby decreasing the utility of making full slices). Once a penny is cut in half, the two parts won't stay together anymore, unlike a pizza where the entire thing retains its same shape the entire time. I also wonder about the utility: a fraction of a penny under 50% of the total volume is completely worthless. When someone has more than 50%, then it is worth the entire value of the penny. Cwallenpoole (talk) 14:16, 24 March 2022 (UTC)

You can clamp down the two parts of a now discected coin, for a further cut across-tye-cut almost as easily as you can clamp down the original. Harder to do the two ⅙ths and two ⅓rds (or just the latter two) to get the final four ⅙ths. Or overlay the cut halves (or thirds), perhaps, then cut through both with a powerful enough slicer.

But the way I'd do it (assuming 6 ⅙s is the target) is to make the cut across all but a sliver of one edge, realign, make a similar cut (liberating ⅙, having ⅓+⅙+⅓ still joined) then clean through at the third angle (two more ⅙s loosed), after which you just need to snip through the two cut-ends that you left to make the slotted ½ into 3 separate ⅙s.

Just snipping from edge to centre, three times, can mess up at the meeting point. Though it involves the same angles, getting them to meet (non-messily) in the exact centre is awkward, and it's easier to visually map six equilateral triangles with an edge-length equal to the radius (to execute three cross-cuts, fairly) than the three obtuse triangles (or one equilateral triangle with edges ≠2r) in planning where on the edge to start. Well, from my regular experience in actual pizza-cutting into three equal portions, before we get to the difficulty in cleanly cutting a much smaller coin made of metal. 141.101.99.154 14:44, 24 March 2022 (UTC)

Any idea how Cueball arrived at the figure of $61 1/3 thousand?--Troy0 (talk) 03:33, 24 March 2022 (UTC)

Arbitrarily non-round numbers are a really good idea as per [1] (which I just added), and Cueball's is one of the simplest in terms of algebraic fractional expression at the bottom of the 110-120% widely-accepted counter-offer range already mentioned (with which I agree and have heard repeatedly from associates, but rather uncomfortably is in the explanation without a source.) I would sincerely say he's being quite shrewd at that point, except for the haggling over cents and fractional cents. 172.70.214.185 03:20, 25 March 2022 (UTC)

Interesting. In the UK, I was taught to call them recurring decimals. Never heard of repeating decimals. --141.101.99.20 08:46, 24 March 2022 (UTC)

I just assumed the usual trans-Atlantic difference in terminology. In general I'd also say "point three three three recurring" to establish the (unvarying) pattern, or something like "point one nine one nine recurring" for a bistable pattern, etc, so that it doesn't look like all-nines to infinity. But, to be honest, I'd be glad if people didn't use "point thirty-three" or the like. ;) 172.70.90.211 10:25, 24 March 2022 (UTC)

I don't think the 15% is meaning a 15% cut in the (offered) salary, as the current explanation has it. I think this is referencing agent-type negotiations, where the agent might take 15% of the salary negotiated for the person they're representing.172.69.79.209 09:15, 24 March 2022 (UTC)

Fixed. Justhalf (talk) 10:51, 24 March 2022 (UTC)

Also inappropriately used/ill-formed, in this negotiation, but "15% of the gross" might be a given film-star's deal for appearing/cameoing in a movie, i.e. variable according to the success, tying directly into the money it earns the studio - potentially quite lucrative, without scaring off the studio by risking it (excessive) debts in the event of a flop or other failure to cash in. So long as the total percentages are not excessive!

A salary that is a set percentage (other than 100%) of one's own salary is, of course, nonsensicle and paradoxical (though one could suggest an introductive percentage 'discount' for the first year, as a wary employer's inducement/guarantee, perhaps in direct exchange for a corresponding bonus against the measure of productivity that is expected/hoped to be massively increased by being hired), but muddled Cueball seems to be grasping at apt-sounding fragments of such 'business language' yet mashing them together in various wrong ways. 172.70.162.147 12:47, 24 March 2022 (UTC)

Summary is way too long and overdetailed. It's more like a play-by-play of the comic than an explanation 172.69.248.145 02:06, 25 March 2022 (UTC)

Seconded. Apologies to whoever wrote the existing description, but you worked too hard. -mezimm 172.70.130.91 19:37, 25 March 2022 (UTC)

As others have pointed out, $61,333.33 1/3 is not an irrational number; however calling it a rational number (and linking the page for that term) seems pointless. Could we change it to say "irrational amount" to indicate Cueball's mindset and eliminate the link?

Why not just say that the 1/3 of a cent is paid in advance in 3 year cycles? The first year will get him $61333.34, then $61333.33 for the next 2 years. He can just save the 2/3¢ for the second and third years. :P 162.158.118.58 06:49, 20 July 2023 (UTC)