Ask for More Pay and Get Penalized, Stay Quiet and Fall Behind

Michele Gelfand has studied and taught negotiation for years. A professor of organizational behavior at Stanford Graduate School of Business, she sees negotiation as a skill it’s imperative for everyone to learn. “It’s not something we’re born with,” she says. “It’s something we learn over time.”

Increasingly, she’s been curious about how factors like gender and class affect who feels empowered to advocate for themselves. In a new paper in Proceedings of the National Academy of Sciences coauthored with Ying Lin of Hong Kong University and Jackson Liu of MIT’s Sloan School of Management, Gelfand finds that people from lower socioeconomic classes are not only less likely to negotiate their salaries but also more likely to be punished if they do ask for more money.

“This study is showing not only that there is a difference in who gets to the negotiating table, but also that when they do negotiate, there seems to be more backlash,” she says.

Gelfand wondered if differences in people’s willingness to negotiate emerge along class lines. She also wondered whether lower-class people’s fears of backlash are justified. To investigate these questions, she and her colleagues conducted five studies with different methodologies.

The first study examined data from over 7,800 Australian workers. Using education as a proxy for class, the researchers found that lower-class employees were less likely to report that they negotiated their salaries, even when controlling for many factors. This difference mattered: Those who negotiated ended up with higher wages.

Recognizing that education isn’t a perfect indicator of class, since workers may have had specialized skills or training, the researchers then set up a negotiation study with over 600 recent MBA graduates from a top U.S. business school. All students came in with the same skills, but their parents’ educational attainment was used as a proxy for class. Although all the graduates received the same education and professional training, lower-class graduates were more likely to accept the salary they were given. Many said they didn’t negotiate because they didn’t want to “damage this new relationship.”

Upper-class graduates generally only negotiated a slight pay bump — about $6,450 higher than their fellow alums. It’s not a lot, but over the next four decades, that difference compounds. By the time they retire, those who negotiated earned nearly $800,000 more than their lower-class counterparts, simply by asking for more money all those years ago.

A third study tested the paper’s hypothesis in a controlled setting. Nearly 700 participants were asked to complete a simple task and told they would get a performance bonus between 50 cents and $3. Although all the participants were offered 50 cents, participants from high-income groups were more likely to negotiate their bonus up.

The “Double Bind” of Negotiating

In another study, the researchers investigated the psychology behind this reticence to negotiate by sending a survey to nearly 1,000 U.S. workers, asking whether they had negotiated their starting salaries, benefits, or raises and if they hadn’t, why not. The results showed that lower-class respondents were hesitant because of a mix of fears about backlash and a reduced sense of power.

Gelfand acknowledges that the average correlation across these studies was relatively small but consistent. “We had all these different methods and samples, and we got the same pattern every time,” she says. “That gives us more confidence in our conclusions.”

She’s also encouraged that the pattern emerged in the Australian data. “It gives us confidence that the theory isn’t wedded to a specific sample as of yet,” she says. That means these trends may exist in nations that are culturally similar to the U.S. However, she says, “More research is needed to replicate the findings across many diverse cultures.”

In their final study, the researchers looked into whether fears about backlash to negotiation are grounded in reality. They showed HR professionals four scenarios involving job applicants who did or didn’t negotiate their salary. Although the HR people perceived applicants who negotiated as uncooperative for both lower- and higher-class candidates, they viewed lower-class negotiators as less cooperative and less hireable.

Gelfand describes this outcome as a “double bind.” If lower-class applicants don’t stand up for themselves, they won’t get the same pay as their higher-class peers. “But speaking up carries a higher social penalty,” she says.

She also sees these results as a message to employers. “Encouraging people to speak up isn’t the whole picture,” Gelfand says. Instead, she argues that organizations need more transparency around pay, raises, and advancement. Without clear structures that spell out how much people make, why they’re getting promoted, and what those promotions entail, these inequalities will continue.

This work is part of a broader research program aiming to make social class more of a focus in organizational behavior and psychology research. In another recent paper, Gelfand demonstrates that people from lower social classes follow stricter cultural norms characterized by less tolerance for deviance. “They feel rules are really important to keep them safe,” Gelfand says. In the workplace, this may translate into a fear that if they rock the boat, they’ll hurt their job prospects or damage their relationship with their employer.