Leaving a project for a better job

BrookieD · 12-06-2021 4:18pm #1

Mods feel free to move if in wrong section...
Background: I'm currently working on a project at a company. The work is good but the salary is less than satisfactory/comparable. I would be a senior manager and tech lead on the project. I have a decent salary but am paid 30% below market rate for my role.

While i was not looking for a new role via LinkedIn i was contacted and after initial push back i had several conversations and this moved to a formal offer. The offer is fantastic from the another company as they are willing to pay me 30-40K more than what I currently earn.

After talking to my manager the company came back a day later with a one off payment tax free payment (significant) paid after project go live as they fear if i leave the project go live is under serious threat due to my knowledge. However no salary adjustment being made to push me towards my new offer. While short term the cash would be nice i think long term its just way off the mark. And even if I negotiate, there's noway they will match a 30-40K bump (fact, not a rumor).

So, is it wise (or rude? - bridges will be broken) to leave a project (that will go live in the next 3-4 months) for a way better salaried job given that the current company would never match a huge salary bump from the offering company? Is it wrong to be selfish and not think about the greater good of the team/project/company?

Also, the offering company prefers that I join within a month or two and they can't wait for more than 3 months because otherwise I'd have seen my product go live and then switch jobs.

Would love to get/hear some advice/opinions. TIA.

Wildly Boaring · 12-06-2021 4:22pm

Are you happy with the new company?
Will there be more hours or a lot more pressure?

Basically look after yourself.
30 or 40k uplift is huge.
Grab it with both hands if you like the rest of the role.

Don't worry about the current project.

BrookieD · 12-06-2021 4:24pm

To be fair the new role seems excellent, great hours, numerous best work place awards, path to senior management already laid out, same hours and while faster paced its the same role i do so no more pressure than i face now

The Buster · 12-06-2021 4:25pm

you have to think of yourself first - so is it wise to leave? for a bigger salary and if you are happy to move the answer is yes. You are not been selfish. You are worried about breaking bridges - might take time but they can always be fixed.

They are offering a Tax free payement of 20k. Not so sure there is such a thing (unless you are looking at something like a pension contribution) so the net value is probably closer to 10k. If they really valued you they should be pffering you that to finish the project plus looking at salary rise (maybe not matching the other company but moving towrds it)

[Deleted User] · 12-06-2021 4:28pm

Without a doubt, take the new job.

A one-off €20k payment after 3 more months is an insulting offer, given the difference in salary vs market rate and the value they derive from your contribution.

It’s time to go now, without any hesitation. They’ve been underpaying you for some time now and want you to wait until the project outcome is secured before paying you anything, let alone addressing the salary.

As a veteran in the IT industry, an experienced HR manager and someone with a keen understanding of how little the response means in context, I tell you to make the move and don’t look back.

Any promise they make now is meaningless. If they meant it, wanted you to stay and be a happy and productive employee they would have fixed your salary, not offered a one time bonus. Do not stay. Go now while you’re in demand.

BrookieD · 12-06-2021 4:29pm

The Buster wrote: »

you have to think of yourself first - so is it wise to leave? for a bigger salary and if you are happy to move the answer is yes. You are not been selfish. You are worried about breaking bridges - might take time but they can always be fixed.

They are offering a Tax free payment of 20k. Not so sure there is such a thing (unless you are looking at something like a pension contribution) so the net value is probably closer to 10k. If they really valued you they should be offering you that to finish the project plus looking at salary rise (maybe not matching the other company but moving towrds it)

Agreed and while i know the offer cannot be matched i have been at pains to state that i don't expect a match but rather a decent salary uplift which has been denied.. so for me the fact there is no long term uplift as such whats the point? they want me to get the project over the line and then leave if you want to....

BrookieD · 12-06-2021 4:31pm

JayZeus wrote: »

Without a doubt, take the new job.

A one-off €20k payment after 3 more months is an insulting offer, given the difference in salary vs market rate and the value they derive from your contribution.

It’s time to go now, without any hesitation. They’ve been underpaying you for some time now and want you to wait until the project outcome is secured before paying you anything, let alone addressing the salary.

As a veteran in the IT industry, an experienced HR manager and someone with a keen understanding of how little the response means in context, I tell you to make the move and don’t look back.

Any promise they make now is meaningless. If they meant it, wanted you to stay and be a happy and productive employee they would have fixed your salary, not offered a one time bonus. Do not stay. Go now while you’re in demand.

Many thanks for that

Interested Observer · 13-06-2021 6:41am

I don't really think you should ever entertain a counter offer, it very much tells you you've been undervalued and the company know it.

You have to look out for yourself. Take the new job.

rn · 13-06-2021 7:01am

Counter offers do work and definitely worth it if the place is an excellent place to work for your circumstances. Moving every 2-4 years is the only way get your salary up to the market level. But the down sides of moving is that you don't build a network that helps you and may get it harder to get work life balance right as you've to keep reproving yourself. Plus if your current work is interesting, there's no guarantee the new work will be.

Op in this case the salary and package is too significant for you not to try it out. Definitely your old company will struggle without you but they will adjust project scope or deadlines and it will soldier on. They won't be happy and if they are not mature enough to wish you well, they are not a good enough place to be long term for you IMHO. There's no such thing as a one off tax free payment, unless they planning on paying the tax on your behalf. Putting it into a pension means you can't get access to it for years.

A salary increase in that order means over 1500 net into your pocket each month. That affords you a better lifestyle and less debt if you use it wisely.

BrookieD · 13-06-2021 8:50am

rn wrote: »

A salary increase in that order means over 1500 net into your pocket each month. That affords you a better lifestyle and less debt if you use it wisely.

Thats exactly my approach as it allows for real change possible house move and other lifestyle options not currently on the table

langer91 · 13-06-2021 9:38am

Weighing up the pros and cons, absolute no brainer to take the new job

Bandana boy · 13-06-2021 10:03am

If you can find a job that pays you 40k more today , what stops you finding a similar job in 4 months time ?

I would stay and finish the project , tell the new guys you feel obligated to close out the project . Your only asking them to wait 1 month more than standard notice for that salary range .

I suspect they accept , but if they don’t then decline their offer and start actively searching for a new role , while finishing the project and getting your bonus .

At a different salary point my advice would be different , but Ireland is small enough that being a senior manager who leaves companies in the lurch is a rep you do not want .
If the offer is genuinely market rate then somebody else will offer it to .

Iodine1 · 13-06-2021 10:16am

Small consideration: you cannot borrow (mortgage) using under the counter payments. The banks will only consider your actual salary so the rise in wages is way more valuable long term. So as I see it your company only want you to finish the project and then happy to get rid of you. Not much loyalty there. Think of yourself and do what is right for you. No one is indispensable, they will get someone to finish the project and the new company will take someone else if you don't take it. So which is right for YOU yourself.

JustAThought · 13-06-2021 10:47am

I’ve been f’d over totally when it suited them by companies I crucified myself working for - from bitter experience I’d say they will drop you when it suits then and get away with whatever they want to achieve their goals with little regard to you. And I mean that from BOTH companies perspective.

A 40k salary hike is huge and a no brainer - IF you get this into your paycheque and IF it dosn’t push you and your (combined) taxcredits into a more punative tax-bracket. I found that by taking a month (or two) between jobs that my tax credits accumulate and as well as the well earned headrest and break it accumulates your taxcredits and gives you an additional increased salary payments you wouldn’t otherwise get if you had just slid from one role to the next and never taken time off.

If your new role goes bellyup or dosn’t work you’ll have totally burned your bridges behind you. Thats fine until your reference check kicks in for the NEXT job (an issue I currently have) - now you are in a not so great position. Maybe your current employer only gives a date to date confirmed employment reference (Like Intel or many others) but there is always the ‘informal phone chats’ with no paper trail that can burn you and ruin your prospects - and are unprovable.

By all means move and try to get the
lump sum from your current employer (is this taxable) UPFRONT and for a time specific period - 2 or 3 months staying bonus - not contingent on ‘finishing the project’ as other variable in the chain could delay it or its completion could drag on for months - other vendors/ Covid delays / procurement/design flaws/Britexit issues etc. And then see if you can negotiate a 2 month lead into your new job - have your cake and eat it??

It used be that you could get a sum up
to X amount as a non taxable lump sum. You could only get so many under different circumstances - and they had a certain way of dealing with them via revenue when they wete from an employer. I got two - but it was a few years back and so the tax laws may have changed - one had to go into a pension as I’d already max’d out the employer lump sum payment one - but that lump sum paid ZERO tax. That was lucrative. Worth inquiring. And it a seperate calculation and tax treatment to lump sum inheritance tax or gifts from relations/bequests. (or it used be).

I worked a big job with a multinational and they promosed the sun, the moon & the stars - in writing - worthless when they wanted to move the function to Malysia & the UK - they can do whatever they want for the first year as you really legally have no real rights. I found when I worked out my hours and divided it into the salary yhat I was earning little over minimum wage - tax took half, my bonus was gobbled by revenue, and when you factored in regular 12 hour days, conference calls at 5am for 2 hours before ‘work’ started and the expectation of working most saturdays for underreaourced and unachievable workloads and goals and all the international travel then the salary was barely worth it.

I’d get onto revenue and discuss the real implications with them for your take home pay and look at your other halves tax credits in combination with the offer & see how it will affect your overall finances. You might be surprised.

Im assuming you’re on a decent salary albeit underpaid already. Max taxing kicks in at 100k.

ted1 · 13-06-2021 10:54am

Take the job, you are replaceable. If you can’t then the company will increase their salary till the find someone.

You are only an employee , you don’t owe your present company anything

Gerry T · 13-06-2021 11:04am

Sounds like you've reached the ceiling in your current role. The new co may have even further opportunities.
You could get sick tomorrow and not be able to complete your current project.
Your current employer sounds mickey mouse, no contingency plans, no idea of your value. I'd move, remember most employers will let you go if they don't have work for you think of yourself.

Finally, everyone that leaves a job leaves work half completed, their not sitting around doing nothing, so don't worry about that.

athlone573 · 13-06-2021 11:27am

I would hang on for the 4 months but get it in writing that they'll cover the tax, you can move then before Christmas.

Tax and prsi/USC at that level is basically half so 40k taxed equals 20k into your hand.

Iodine1 · 13-06-2021 11:29am

"A 40k salary hike is huge and a no brainer - IF ylu get this into your paycheque and IF it dosn’t push you and your (combined) taxcredits into a more punative tax-bracket."

This is a completely wrong yet common misconception. You do NOT lose any money by moving up to a higher tax band, you only pay the higher tax on the portion of income that falls into the higher tax band. Also "Minimum Wage " does not equal " Take home pay". Your overall annual income depending on your individual circumstances determine your tax liability and thus take home pay over the year.

Iodine1 · 13-06-2021 11:34am

Gerry T wrote: »

Sounds like you've reached the ceiling in your current role. The new co may have even further opportunities.
You could get sick tomorrow and not be able to complete your current project.
Your current employer sounds mickey mouse, no contingency plans, no idea of your value. I'd move, remember most employers will let you go if they don't have work for you think of yourself.

Finally, everyone that leaves a job leaves work half completed, their not sitting around doing nothing, so don't worry about that.

Absolutely, described the situation exactly as I see it too.

Iodine1 · 13-06-2021 11:38am

athlone573 wrote: »

I would hang on for the 4 months but get it in writing that they'll cover the tax, you can move then before Christmas.

Tax and prsi/USC at that level is basically half so 40k taxed equals 20k into your hand.

What? And then take them to court when they refuse? Under Revenue your tax is your responsibility and they will take it from you if they discover untaxed income. If the company is paying it, then pay the 40k through the books, tax deducted, and all clear and under your logic it doesn't cost the company any extra.

JustAThought · 13-06-2021 11:53am

Iodine1 wrote: »

What? And then take them to court when they refuse? Under Revenue your tax is your responsibility and they will take it from you if they discover untaxed income. If the company is paying it, then pay the 40k through the books, tax deducted, and all clear and under your logic it doesn't cost the company any extra.

There used to be a once off payment (or twiceoff!) that you could be laid by an employer that if it stayed under the (then ) designated threshold could be made TAX FREE - it was a legal thing and you didn’t have to siphon it into a pension to get the tax benefit. I think this may be what s/he is referring to. It may be changed now or be called something else. Worth calling revenue and discussing it with them. It was a totally legal tax thing - probably to accommodate civil servants getting their golden handshakes when they departed without it costing them half. Dunno if its there anymore.

They could also make the payment into your pension for which there are different benefits and tax implications that might be worth considering - assuming the pension fund survives the covid/britexit /global industry collapses.

I’d advise the OP to contact revenue with hypotheticals and ask them to do the take home pay calculations on different scenarios. I’ve always found them very helpful in doing that kind of thing. Really helps focus the mind if you find much of your new salary increase and company car will be swallowed in lost spouse tax credits, benefit in kind payments, increased USC and punative taxes on basic take home pay.

Especially if you might have a much higher stress job or longer hours or work hassle and unpredictibility for what turns out to be a paper raise and not much real monthly cash benefit.

M_Murphy57 · 13-06-2021 11:58am

JayZeus wrote: »

Without a doubt, take the new job.

A one-off €20k payment after 3 more months is an insulting offer, given the difference in salary vs market rate and the value they derive from your contribution.

It’s time to go now, without any hesitation. They’ve been underpaying you for some time now and want you to wait until the project outcome is secured before paying you anything, let alone addressing the salary.

As a veteran in the IT industry, an experienced HR manager and someone with a keen understanding of how little the response means in context, I tell you to make the move and don’t look back.

Any promise they make now is meaningless. If they meant it, wanted you to stay and be a happy and productive employee they would have fixed your salary, not offered a one time bonus. Do not stay. Go now while you’re in demand.

Couldnt have put it better.

The fact that you are such a key person to your current firm and they had no plan other than significantly underpaying you and hoping youd never leave? What a basket case that firm must be, get out the door for that reason alone nevermind another 30k!

athlone573 · 13-06-2021 12:03pm

Iodine1 wrote: »

What? And then take them to court when they refuse? Under Revenue your tax is your responsibility and they will take it from you if they discover untaxed income. If the company is paying it, then pay the 40k through the books, tax deducted, and all clear and under your logic it doesn't cost the company any extra.

I'm not an accountant
But I understood there was a way for the company to make payments and sort out the tax themselves end result being the same, 20k to revenue and 20k to OP)

If you want to see your take home at various salary levels in the new job there are lots of tax calculators out there, no need to be involving revenue.

helimachoptor · 13-06-2021 12:04pm

Take the new job, it's a no brainer

Iodine1 · 13-06-2021 12:05pm

I think what you are referring to is a "redundancy payment ". After that you can get a few hundred in vouchers as a bonus. There is no loophole that revenue will allow people to get €20K tax free on top of a any reasonable salary. You can pay a part of your income tax free into your pension at any time.

rn · 13-06-2021 2:44pm

There is an unusual anomaly in the IT market at the moment meaning salary models for existing staff are 30-40k off what new starters are being offered. It's not that OP company does not value their work intentionally and if they work in a moderately sized multi national, that company won't be able to match once employees engage a new offer.

It used to be case that ppl were moving for 10-15k pay rises, so counter offering was possible and benefited employee and employer.

I don't know how long present market conditions can last or be sustained once things return to normal

JustAThought · 13-06-2021 7:01pm

athlone573 wrote: »

I'm not an accountant
But I understood there was a way for the company to make payments and sort out the tax themselves end result being the same, 20k to revenue and 20k to OP)

If you want to see your take home at various salary levels in the new job there are lots of tax calculators out there, no need to be involving revenue.

I’m no fan of revenue but this can all be done as a hypothetical over the phone - and get the detail right. Better to check in advance than to
jump and them realise you’ll only be getting half or that you missed an opportumity to negotiate a better deal with a credit you didn’t know about or that the jump will take away credits from your wife and affect your joint taxation status, or that there might be a past tax free gift or inheritance or payment that pushed you past the threshold & now your payment is taxed to the hilt - or that was something you could have availed of that you didn’t know about & can’t tweak retrospectively. Revenue will hypothetical all of that for you without it going on your ‘record’ and before you make a decision based on finance alone.

rn · 13-06-2021 7:51pm

If the manager has mentioned the 20k, it's up to the manager to explain how it will be paid and that OP won't be taxed. I would not be going near revenue at all. The employee is a PAYE employee and company is responsible for collecting his tax from any money they pay him.

ted1 · 14-06-2021 10:14am

The Buster wrote: »

They are offering a Tax free payement of 20k. Not so sure there is such a thing (unless you are looking at something like a pension contribution) so the net value is probably closer to 10k. If they really valued you they should be pffering you that to finish the project plus looking at salary rise (maybe not matching the other company but moving towrds it)

They can just gross up. So they give you 20k + whatever taxes will be needed so you are left with 20.k

spaceHopper · 14-06-2021 10:27am

They have given you no choice but the take the job. No pay rise = after you go live with the project they will no longer need you. You both will know that you are under paid and you will probably me managed out or made redundant hence tax free paymeny.

The best thing you can do is hand in your notice, give them 6 weeks notice and start handing over to somebody internal or write a handover document so that the change goes smoothly.

Move on to the new job. Then poach all their best staff so that your next job goes smoothly for you ;-)

Chris_5339762 · 14-06-2021 10:40am

Its not all money, IMO, quality of life and commuting, stress levels, how good a company is to work for, etc etc etc. So think about that before saying yes or no.

30k or 40k is a biiig jump though, remember though what goes into your pocket will be half (or less) of that due to the higher rate of tax or the USC at higher wages (which I'm assuming you're on due to such a jump).

The first company saying a "20k tax free payment" is meaningless. 20k from your employer to you will be taxed (probably at the higher rate" as it will be treated as a bonus or wages, or benefit in kind or however they try to spin it. Thats approx 10k after tax. Your new job will be 15k per year or 20k per year after tax so you've made it back in six months - your old company doesn't know what its doing if they're trying to pull that off.

Might be worth asking the new company what they can do - say that your old company has offered you X amount more, see if they up their offer themselves.

Telling the new company "3 months I'll be there", taking the 20k cash from the old company and doing the project, then leaving, would be the hardcore option. Tempting.

Leaving a project for a better job

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