I heard this week from two former students who are anxiously waiting for job offers after surviving intensive interviews and reference checking. Their questions range from “Should I negotiate a higher salary?” to “What are the typical benefits that I should ask about?”
Shortly after those conversations, I received a great guide from Pat Morgan at Affordable Colleges Online that is jam packed with tips on how to navigate job offers and negotiations. It took me a couple of career moves to grasp many of the nuances and job-related terms detailed in this valuable guide, Careers After College and Job Offers.
The guide will be invaluable to my former students as well as others eagerly awaiting job offers. The guide breaks down questions to ask while evaluating a job offer, terms to know before accepting a job, an extremely informative Q&A with career expert Dana Manciagli, a checklist for both accepting and declining job offers, and additional resources that can help recent graduates with their journey toward building their careers.
Below are 18 key terms you should know before accepting a job offer:
The salary workers receive based on a specific unit of time, such as an hour, day, week, month, or year. Base salary does not include overtime pay, incentives, commissions, or benefits.
A payment that workers receive in addition to their base salary. Performance-based bonuses are often given to workers for completing a specific task or achieving a goal. Bonuses can also be non-performance based, and are typically given to workers at the end of the year.
Benefits are the compensation workers receive in addition to salary. Benefits can include health insurance, disability pay, life insurance, retirement plans, and tuition assistance.
Paid time off
Paid time off is part of an employee’s compensation package and can include sick days, vacation, bereavement time, and personal days.
An employment contract is the agreement that an employer makes with an employee regarding salary and benefits. Contracts can be issued in writing or verbally.
Direct deposit is an alternative to receiving paper checks, and is required by some employers. Wages are automatically electronically transferred into an employee’s bank account.
This common retirement plan allows workers to make deposits directly into a tax-advantaged investment account. Some employers also make matching contributions to these accounts (up to a certain amount) on their employees’ behalf.
Employers offer different types of insurance plans as part of their benefits packages. The following are some examples of the insurance that workers may have access to through their jobs.
Health insurance is provided to employees to help them pay for routine medical care as well as major expenses.
Dental insurance operates similarly to health insurance, but is offered under a separate plan.
Allows workers to receive reduced fees for vision exams, glasses, and contact lenses. Some plans cover the entire cost of these services.
Life insurance is designed to give workers’ families financial support when they die.
Disability insurance is for workers who have suffered an injury or illness and are unable to work. People with this insurance receive a portion of their salary. COBRA (Consolidated Omnibus Budget Reconciliation Act) allows workers to extend their health insurance coverage after they have left a job.
Also known as an Employee’s Withholding Allowance Certificate, a W4 is designed to furnish employers with details about a worker’s tax situation, including how many exemptions they have. Generally, workers claim themselves as the head of household if they are unmarried, and list any children they have as dependents. Those who are unsure of what to claim can get help with this IRS calculator.
FSA or HSA Plan
Flexible Spending Accounts, or FSAs, are a type of employee benefit that allows workers to set aside pre-tax funds that can be used for dependents’ day care or eligible health-related expenses. Health Savings Accounts, or HSAs, also allow you to set aside pre-tax money for qualified health expenses, but there are a few differences. For instance, with an HSA you can invest the money in the account, and take the money with you if you leave that job.
Some employers pay for their employees to earn a degree or get specific training. Assistance may cover full or partial tuition, as well as books and supplies.
Stock Grants, Stock Options, and Profit Sharing
Some workplaces have ways to allow employees to invest in or be compensated through ownership in the company. There are many varieties, but some common forms include Employee Stock Ownership Plans (ESOPs, which allow employees to invest in the companies they work for under favorable tax terms), stock options (which allows employees to buy stock at a reduced price), and stock grants (which gives employees shares of stock as part of their compensation package).
During this period—usually 30 to 90 days—workers are not considered regular employees, and do not have access to the same benefits as regular employees.
This pay is given to certain employees when they exceed 40 hours in a single workweek. Under the Fair Labor Standards Act, employers are required to pay one-and-one-half times employees’ regular wages for all hours beyond the 40-hour mark – but this only applies to “non-exempt” employees, meaning non-salaried workers.
Payments workers may receive for traveling for work purposes.
Company culture refers to the unwritten workplace rules regarding beliefs, attitudes and values to which employees are expected to conform.
Non-disclosure agreement (NDA)
An agreement that prohibits workers from sharing their employer’s confidential and proprietary information with anyone else.
A severance package describes the pay that people may receive when they have been terminated from their job.