Negotiating Your First Salary: Know Your Worth
Medical residents across Canada know exactly what they can make—and what their peers are making. In British Columbia, medical residents will earn between $51,859 for PGY-1 to $83,033 for PGY-7 for the April 2017-January 2018 period.
Salaries are set out by a collective agreement (refer to Article 21) between the Health Employers Association of British Columbia and the Professional Association of Residents of British Columbia. Among same-year medical residents in BC, there’s no variation and no room for negotiation.
But once you move into practice, this level playing field soon changes. Your income will depend not only on your specialty, location and practice position but also on your negotiating skills.
Most people find negotiating their salary uncomfortable. Physicians, in particular, may not want to be seen as choosing medicine for the financial rewards. However, negotiating the best possible income and service obligations in your first practice position will serve as a sound foundation for the future. Keep in mind that your raises will be based on this starting income and the terms you accept will be factored in to negotiations for new jobs down the road.
From a financial perspective, a higher starting salary can make a huge difference to your net worth later. The more money you can save and invest—and the longer your time horizon—the greater the effect of compound growth.
Effective negotiating starts with your mindset
Before you start pursuing practice opportunities, take time to create a mindset that will help your salary negotiations go more smoothly. Here are three critical aspects to tackle.
1. Learn to be uncomfortable
What makes some people better negotiators than others? Are they smarter, less emotional or more confident? These are all good theories but here’s the real difference: the best negotiators are willing to be uncomfortable for longer.
Most people find the negotiation process and discussions about salary and remuneration so uncomfortable that they want to avoid the exercise or get it over with as quickly as possible. But if you learn to manage your discomfort, you’ll be able to take your negotiations farther, for a more satisfying end result.
2. Appreciate the value you bring
Medical residents—after years of medical school and training and having, in many cases, served in a support role—often undervalue their abilities and assets.
But today’s residents have more specialized skills than any previous generation of physicians. They are already making a significant contribution to patients’ health care.
Think about the value you would bring to any potential practice opportunity. Then make a list of the specific ways you would contribute. Review that list regularly.
Any offer that you receive should recognize your value. Settling for an agreement that’s less than favourable could be costly both personally and professionally.
3. Prepare in advance
Before you start investigating practice options, think about your priorities: what are your lifestyle desires, career goals and objectives, and workload and remuneration ideals?
Then, do your research. You can find information about potential gross billings and net income for your specialty through various sources:
- colleagues who recently started practice
- your program director
- the head of your department
- other staff physicians
- provincial and territorial medical associations that may have data on average annual billings for each specialty
Investigate both the monetary and non-monetary benefits that might be available. You should also learn about your negotiating partners and the specifics of the opportunity you’re considering—such as the likely number of applicants for the position, the specific professional needs of the group or institution, and the positive and negative attributes of the practice.
Doing your homework this way will give you an informed and objective perspective with which to negotiate and evaluate offers.
Other dynamics that will put you in the best position include always being professional and courteous. Also, before you sign any agreement, have your lawyer review the draft contract to make sure all of the terms and conditions you have negotiated are properly documented.
Having the appropriate mindset will serve you well as you negotiate your first salary and embark on your career and your future in general.
This article is courtesy of Lawrence Jarikre, a Financial Consultant with MD Management Limited in Vancouver.
Some content originally appeared in the Canadian Medical Association’s Practice Management Curriculum Module #9 – Principles of Negotiation. Reprinted by permission.
MD Financial Management provides financial products and services, the MD Family of Funds and investment counselling services through the MD Group of Companies. For a detailed list of these companies, visit md.cma.ca. MD Management Limited – Member – Canadian Investor Protection Fund