As Talent Acquisitionist’s we follow procedure to procure information that can help us sell the position better and on board the Talent with the credentials and calibre we know are perfect for the role. Questions like current CTC, the profile the potential Talent is looking for are a few examples of procedural questions asked. Having said that, have you ever thought of its relevance in Candidate selection? If not then here’s a chance to find out for yourself and add to your knowledge.

We @SourcingAdda are constantly striving to assist our fellow Talent Acquisitionists to remain updated with the current trends and practices that are followed. More importantly we are able to do that due to the efforts of our group members; one of them being Vineeth from the Pune group. As per his suggestion our discussion topic was on, “Relevance of Recruiters asking Candidates about their CTC in the selection process, in reference to the article, “HR why? They need current CTC “Cost to company” To view it visit – https://www.linkedin.com/pulse/hr-why-need-current-ctc-cost-company-gagan-malhotra on 2 parameters namely,

1. Should Recruiters ask candidates about their CTC?
2. How will this information help them?”

As always we’ve received an outpour of responses, and we’re sure you’d like to know more so we’ll be sharing the discussion shortly, meanwhile do remember to view the key take a way pointers that are highlighted right after. So here goes…

Well the informative discussion ends with a lot of views expressed, inputs to take back and add to your learning; especially, when the discussion addresses important and sensitive aspects like the CTC of the Candidate. Although asking a potential Candidate for their current CTC is procedure how relevant do you think it is? So here’s a chance to find out by reviewing the key take away pointers, so let’s begin…

Accept certain facts

• If you have something to offer it comes with a price and shopping for Talent requires a careful thought process.
• Realise that it’s the business that calls the final CTC especially if it’s a billable resource
• Sometimes companies have to go beyond their budget to on board a good candidate in the organization.
• Ultimately money is what interests the candidate for a switch
• Having CTC discussions are of prime importance but at a later stage for certain
• Even if in the early stages prospective candidates claim otherwise, money is a great motivator because it’s an important aspect.
• You always need to respect that and play your cards accordingly and you’ll come across several candidates that ask about the salary they’ll get up front.
• For a candidate there is at least a max of 10 options or companies available where the candidate can join after clearing the interview.
• For a recruiter they might have 50 odd options for just one position
• Realise that you’re dealing with a human and not a machine so respect that
• Recruiters simply cannot afford to ignore CTC or leave it out of discussions
• HR or Recruiters have a budget within which they have to hire; hence, asking current and expected CTC is absolutely fine and an expected norm.
• Recruitment is not just skill mapping
• Cost is one of the most important elements of selection
• The CTC offered depends on which industry you are hiring for like service industry or product and everything has a budget and numbers are what matter for the management panel.
• Recruitment is referred to as a job market where; in the job market a candidate has their individual skills, experience, talent, education etc… that are their USPs.
• Disclosing salary information to an entity which might not even associate with the organisation would just broadcast the core that’s meant to be confidential for multiple reasons including but not limited to market – competition, budgets, payroll parity.
• Businesses have certain operation costs and hence budgets have been allocated
• Recruiters cannot simply offer fixed compensation without calculating the percentage hike
• Passive candidate engagement is a different ball game all together.

Procedure to be followed

• Recruiters work as per the client’s requirements so it’s important for the company to understand the hiring scenario especially if they are to come to an understanding about the range for the budget.
• In an order to hire the right fit talent an organisation needs to have a right strategy of hiring
• You need to check which level the candidate is being shortlisted for provided that the HR, Recruiter and the Delivery Team are ok in hiring at this level.
• Check the Candidates Base Pay Target Ratio (BPTR) and it can create parity issues
• When comparing the Candidate’s current CTC take in to consideration the benefits that they get apart from money as considering only money doesn’t attract middle level and above Talent.
• Mostly the profiles we Source usually miss out information about the CTC, don’t have updated information, has vague figures and incomplete structures i.e. fixed, variable, benefits etc.
• It’s perfectly alright to confirm the CTC over a call but provided the Candidate asks a question related to the CTC.
• Although asking about the CTC may not be alright but having that information when you have a time constrain; asking for the CTC would be a good option as you’ll be able to make sure that you’re bringing in the right talent at the right cost besides your KPI is affected.
• In fact if one follows the theory of going by the mentioned profile information, chances are that you might select the candidate especially the ones that have gone through a number of rounds that involve time, cost, you’re efforts including the time spent by various individuals from different levels in an organisation.
• And as per your calculations you might offer the candidate something beyond market standards only to realise that their salary details were updated during the last appraisal cycle.
• On stretched compensation is where a corporate Recruiter has to understand whether the role they are hiring for is strategic or operational in nature.
• Recruiters need to consider the urgency, the available candidate pool and impact of a non-hire / late-hire has on business.
• On the basis of the above mentioned aspects you can recommend a stretched budget or not for a particular role.
• An initial budget of 15 lakhs that is closed at 28 Lakhs indicates poor research that went into the role definition, expectation setting (of hiring managers) and market research.
• It put’s Corporate Recruiters capabilities in a poor light meaning that they haven’t done their homework or they haven’t been able to communicate effectively with the hiring managers or there could be a trust issue.

Possible Solutions

• Rather than asking the Candidate about the CTC, let’s give the candidate the Job offer as well and if the candidate finds the offer appealing and meets their expectations they’ll take it else if they disagree then they’ll probably object and state their expectations.
• A simple, honest approach might get you everything you may need for a successful screening
• There are always other ways to find out the information; besides its essential that Recruiters make sure that there are not over paying the candidate than the company’s existing employees or the market standards.
• In general Hiring trends normally a passive candidate will not look only for the CTC or you’d find them on job boards; which motivates them for a change.
• Sometimes Passive candidates are found interested in the money; although they aren’t on, job boards.
• With the right connections made or if you are on the right track you’ll be able to get the CTC without asking if you –
  • have industry connections
  • you know how to fetch the band structure which reveals the required initial level information
• Irrespective of the budget, if you ask prospects of the CTC and assure them that you’ll try to get the best possible offer for them, it will give them comfort and confidence.
• There is a trust factor that you need to establish though as the success ratio will be better if we can establish that faith; it’s generic but works a lot of times.
• Expecting Recruiter’s to call every 50 candidate and tell them what they are offering as CTC to the Candidate is unfair.
• Recruiters have certain parameters to shortlist candidates on; when calling 50 candidates is unfair, such parameters can be based on the experience or money.
• CTC offer will depend on –
  • interview performance
  • how the profile is perceived which does not impress prospective candidates to present their candidature at least at entry level
• For senior positions candidates ask for the “budget” in a sophisticated or refined manner to ensure that they will not be wasting their time.
• While India doesn’t have a law against asking about the Candidates CTC a better approach is to ask the question; for this particular position, is it better to take a transactional approach to the selection process or should one take a strategic approach.

Relevant & Positive Aspects

• Asking details regarding whether a Candidate is perfect for the role are aspects to focus on
• Having information about Candidates current CTC helps in –
  • Negotiating the salary package, especially when there is a budget constraint
  • It also ensures that the replacement cost don’t exit opportunity cost
• If the salary range for a position is between “x – y”, unless the recruiter knows the candidate is not <x, it will be a waste of efforts to proceed with the candidature.
• A lot of countries have a role / experience based standard of benchmarking with the least disparity, data published online for everyone to see.
• Discussion regarding the CTC helps in understanding Candidates attitude and aspirations
• It’s important to ask about the CTC as it helps to decide about whether or not the Candidate is the best fit for the role.
• Hiring any external resource without having comparative analysis with internal resources creates disparity and a low level of engagement.
• Monitoring you potential Candidate’s digital footprints to gather content to take the conversation places is absolutely essential.

Irrelevant & Negative Aspects

• Asking details regarding personal information like Candidates current CTC is not needed
• India is the only country where Recruiters tend to ask so many questions about personal details
• Abroad asking personal information like Candidates current CTC can be considered as an act of discrimination.
• India cannot be compared with other markets
• Salary information of any HR department in an organisation is black box information

Well this brings our informative discussion to an end with a lot of inputs to take back and add to our learning and help us stay updated with the best practices of on – boarding candidates. This entire conversation has been summed up substantially well by the members in a saying, “Recruitment is referred to as a Job Market where, in a Job Market a Candidate has their individual skills, experience, talent, education etc… that are portrayed as their USPs. Thus, if you have something to offer it comes with a price and one doesn’t blindly shop for talent.  It’s pretty basic!”

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