Should your past pay cheque define your future salary?
You must have gone through rounds of interviews, liked the role, cleared the process, and then the question turns to your previous CTC, and suddenly the new offer falls flat. That is the question at the centre of the salary debate: should your next pay depend on what you earned before, or on what you can do now?
Vedant Singh knows exactly how quickly an exciting job can lose its shine.
Last year, he cleared every round of an interview process and thought the hard part was over. But when salary talks began, the numbers told a different story.
“Even though there was a hike compared to my previous salary, the salary components were structured in a way that my in-hand salary would have been lower than what I was already earning,” he says. He tried to negotiate. The company did not move. He walked away.
And Vedant is not alone. Candidates spend hours clearing tests, interviews and evaluations that are designed to measure their potential. But when it comes to salary discussions, all of that often takes a back seat to a single question: What was your previous salary? For many professionals, that answer ends up becoming the foundation of what they are paid next, regardless of what they can actually bring to the role.
"Why should my pay be based on what I earned in my previous job when I can bring so much more to the table?" says Aman, a Mumbai-based software engineer, adding that the moment salary discussions begin, it feels like my skills and experience no longer matter.
Looking from a broader perspective, it is not just about money. It is about whether a candidate is being judged for their present value or trapped by their previous payslip.
What if the previous pay was unfair? What if it was not paying the employee what they deserve? The same trap continues: the job role increases, work burden goes up, but the salary does not, it crawls.
WHY DOES THE PREVIOUS PAYSLIP BECOMES DECIDING FACTOR FOR THE NEXT ONE
For a long time, companies treated previous salaries as a neat shortcut. It helped them decide quickly, avoid overpaying, and, in some cases, keep candidates from inflating their worth.
Anil Agarwal, co-founder and CEO of InCruiter, says the old rule was really about convenience. In his words, companies once used previous pay as a proxy for capability.
But that system was built for a different job market, one where people stayed for years and career moves were less frequent. Now, job switching is far more common, and skills age faster than old compensation norms.
Deepti, a frontend engineer with two years of experience who is based in Bengaluru, says she has already turned down an opportunity because the pay did not match the responsibilities.
“The role seemed good, but the compensation did not match the responsibilities and effort required,” she says. She would rather want employers to assess her “skills, experience, and market value” than her previous CTC.
The World Economic Forum says the jobs market is being reshaped by technological change, economic pressure and shifting skills needs, with employers expecting 39 per cent of key skills to change by 2030.
That makes the old logic look increasingly shaky. A salary earned two or three jobs ago does not always say much about what a person can do today.
WHY ONE LOW SALARY CAN FOLLOW YOU FOR YEARS
This is where the previous salary trap becomes more troubling.
Agarwal says the problem is not just that the previous salary is outdated. It can also keep underpaid workers stuck for years. "This is the cruellest part of the current system," he says.
"Someone is underpaid at Company A, gets 20 per cent raise at Company B, still underpaid. Gets another 20 per cent raise at Company C, still underpaid relative to the market," he explains, adding that it takes years to correct a single bad decision made early in their career.
In his view, that hurts everyone, but especially women and marginalised groups who may already have started from a weaker negotiating position.
That is not just a hiring-room complaint. It connects with broader pay transparency debates globally. The Organisation for Economic Co-operation and Development's (OECD) 2026 report, 'Pay Transparency in Progress' says bans on asking jobseekers about salary history can help ensure wages are attached to the work being done, not the worker’s past pay, and may help break patterns of underpayment for historically underpaid workers, many of whom are women.
Gaurav Sharma, CHRO at True Balance, makes a similar point. He says previous compensation can offer context, “but it should not be treated as the sole decisive factor of pay.”
What matters more, he believes, is interview performance, skills, knowledge of the role and the actual value a person can bring now.
That is the part many people keep asking for but in different ways: Pay me for what I can deliver, not for what someone else once decided I was worth.
WOULD PEOPLE TAKE A LESS-PAYING JOB?
Many professionals argue that previous salary should not determine what they are paid next because an old pay cheque does not always reflect their true market value. In many cases, candidates switch jobs not for big hikes, some are just trying to reach the market rate after being underpaid for years.
Harshita, a backend engineer with four years of experience, says she has also declined an offer for the same reason. The role involved critical backend systems, but the package did not feel competitive. She says previous salary can be misleading because it may reflect the habits of an old employer, not the worth of the person sitting in the interview.
Bhawana, a collections and operations manager with eight years of experience, says the same thing in slightly different words. She has turned down roles where the salary was “not in line with my experience, responsibilities, and market standards.”
When recruiters focused too heavily on her past CTC, she responded by pointing to her achievements, team handling and business impact.
Then there is the other side of the story: the employees who stay longer.
Sneha, who has been working with a media house in Delhi for more than 10 years, now finally wants to change her job. But, her loyalty to her workplace has brought her nothing, not even a decent saving.
"I am not even earning double of what the freshers are getting paid in my company after working for 12 years of my life in the company," she says, adding that this now impacts the new job roles she is trying to take.
This is the trap many employees are already in, especially the ones who are loyal to one company.
Agarwal argues that long-tenured workers are often punished by the old system.
He says that someone who remains with one company for a decade may end up earning far less than a peer who switches every few years. When that loyal employee finally looks for a new role, the new employer may still anchor the offer to that lower current salary.
At this stage, many employees start wondering, 'Why is my loyalty being treated as a weakness?' That thought is often followed by another pressing question: 'If I have dedicated so many years to the same company, why does my salary still fall short of my expectations or prevailing market standards?'
THE MARKET IS MOVING, EVEN IF HIRING HASN’T FULLY CAUGHT UP
The debate over whether previous salary should influence future pay is playing out against a changing job market. While many employers still ask for salary history, there are signs that hiring is becoming more transparent and market-driven.
Aon's Annual Salary Increase and Turnover Survey 2025-26 India found that salaries are expected to rise by 9.1 per cent in 2026, following an actual increase of 8.9 per cent in 2025. The survey also noted that fewer people are changing jobs, suggesting a more stable job market than the hiring frenzy seen after the pandemic.
At the same time, salary transparency is becoming harder to ignore. An Indeed India analysis found that more than half of job postings in India were disclosing salary information by early 2025, up from just 26 per cent in 2022. Nearly two-thirds of jobseekers said they prefer listings that clearly mention pay.
That shift could make the debate over salary history less relevant. When candidates know the pay range for a role, negotiations are more likely to focus on the job itself, the skills required and the value a person brings to the table, rather than what they happened to earn at their last company.
Candidates can compare roles more clearly. Employers can no longer hide behind vague “best offer” language. And workers can ask the more honest question: does this role pay for the work, or merely for my last job title?
SO WHAT SHOULD A FAIR OFFER LOOK LIKE?
If there is one thing experts agree on, it is that the next salary should not be a mechanical extension of the last one.
Sharma says companies should move towards role-based and skill-based pay structures, especially because business and technology are changing too quickly for old compensation habits to keep up. He argues that organisations should pay for the impact a person creates, not simply the number printed on their previous payslip.
Agarwal is more direct. He says the future is skill-based compensation, where the company defines the skills required, tests them objectively and pays according to capability and market value. In his view, anything else is just “lowballing” dressed up as a process.
That may sound idealistic. It is not. It is practical.
Because when employees say the same thing in different ways, the message is hard to ignore. And perhaps if salaries were based on skills and market value rather than past CTC, Vedant would have known much earlier where he stood. Instead, he cleared the entire interview process only to discover that his previous salary mattered more than his abilities.
And maybe the real challenge for India's hiring system may not be whether companies can ask about previous salaries, but whether they should continue to do so.
Vedant Singh knows exactly how quickly an exciting job can lose its shine.
Last year, he cleared every round of an interview process and thought the hard part was over. But when salary talks began, the numbers told a different story.
“Even though there was a hike compared to my previous salary, the salary components were structured in a way that my in-hand salary would have been lower than what I was already earning,” he says. He tried to negotiate. The company did not move. He walked away.
And Vedant is not alone. Candidates spend hours clearing tests, interviews and evaluations that are designed to measure their potential. But when it comes to salary discussions, all of that often takes a back seat to a single question: What was your previous salary? For many professionals, that answer ends up becoming the foundation of what they are paid next, regardless of what they can actually bring to the role.
"Why should my pay be based on what I earned in my previous job when I can bring so much more to the table?" says Aman, a Mumbai-based software engineer, adding that the moment salary discussions begin, it feels like my skills and experience no longer matter.
Looking from a broader perspective, it is not just about money. It is about whether a candidate is being judged for their present value or trapped by their previous payslip.
What if the previous pay was unfair? What if it was not paying the employee what they deserve? The same trap continues: the job role increases, work burden goes up, but the salary does not, it crawls.
WHY DOES THE PREVIOUS PAYSLIP BECOMES DECIDING FACTOR FOR THE NEXT ONE
For a long time, companies treated previous salaries as a neat shortcut. It helped them decide quickly, avoid overpaying, and, in some cases, keep candidates from inflating their worth.
Anil Agarwal, co-founder and CEO of InCruiter, says the old rule was really about convenience. In his words, companies once used previous pay as a proxy for capability.
But that system was built for a different job market, one where people stayed for years and career moves were less frequent. Now, job switching is far more common, and skills age faster than old compensation norms.
Deepti, a frontend engineer with two years of experience who is based in Bengaluru, says she has already turned down an opportunity because the pay did not match the responsibilities.
“The role seemed good, but the compensation did not match the responsibilities and effort required,” she says. She would rather want employers to assess her “skills, experience, and market value” than her previous CTC.
The World Economic Forum says the jobs market is being reshaped by technological change, economic pressure and shifting skills needs, with employers expecting 39 per cent of key skills to change by 2030.
That makes the old logic look increasingly shaky. A salary earned two or three jobs ago does not always say much about what a person can do today.
WHY ONE LOW SALARY CAN FOLLOW YOU FOR YEARS
This is where the previous salary trap becomes more troubling.
Agarwal says the problem is not just that the previous salary is outdated. It can also keep underpaid workers stuck for years. "This is the cruellest part of the current system," he says.
"Someone is underpaid at Company A, gets 20 per cent raise at Company B, still underpaid. Gets another 20 per cent raise at Company C, still underpaid relative to the market," he explains, adding that it takes years to correct a single bad decision made early in their career.
In his view, that hurts everyone, but especially women and marginalised groups who may already have started from a weaker negotiating position.
That is not just a hiring-room complaint. It connects with broader pay transparency debates globally. The Organisation for Economic Co-operation and Development's (OECD) 2026 report, 'Pay Transparency in Progress' says bans on asking jobseekers about salary history can help ensure wages are attached to the work being done, not the worker’s past pay, and may help break patterns of underpayment for historically underpaid workers, many of whom are women.
Gaurav Sharma, CHRO at True Balance, makes a similar point. He says previous compensation can offer context, “but it should not be treated as the sole decisive factor of pay.”
What matters more, he believes, is interview performance, skills, knowledge of the role and the actual value a person can bring now.
That is the part many people keep asking for but in different ways: Pay me for what I can deliver, not for what someone else once decided I was worth.
WOULD PEOPLE TAKE A LESS-PAYING JOB?
Many professionals argue that previous salary should not determine what they are paid next because an old pay cheque does not always reflect their true market value. In many cases, candidates switch jobs not for big hikes, some are just trying to reach the market rate after being underpaid for years.
Harshita, a backend engineer with four years of experience, says she has also declined an offer for the same reason. The role involved critical backend systems, but the package did not feel competitive. She says previous salary can be misleading because it may reflect the habits of an old employer, not the worth of the person sitting in the interview.
Bhawana, a collections and operations manager with eight years of experience, says the same thing in slightly different words. She has turned down roles where the salary was “not in line with my experience, responsibilities, and market standards.”
When recruiters focused too heavily on her past CTC, she responded by pointing to her achievements, team handling and business impact.
Then there is the other side of the story: the employees who stay longer.
Sneha, who has been working with a media house in Delhi for more than 10 years, now finally wants to change her job. But, her loyalty to her workplace has brought her nothing, not even a decent saving.
"I am not even earning double of what the freshers are getting paid in my company after working for 12 years of my life in the company," she says, adding that this now impacts the new job roles she is trying to take.
This is the trap many employees are already in, especially the ones who are loyal to one company.
Agarwal argues that long-tenured workers are often punished by the old system.
He says that someone who remains with one company for a decade may end up earning far less than a peer who switches every few years. When that loyal employee finally looks for a new role, the new employer may still anchor the offer to that lower current salary.
At this stage, many employees start wondering, 'Why is my loyalty being treated as a weakness?' That thought is often followed by another pressing question: 'If I have dedicated so many years to the same company, why does my salary still fall short of my expectations or prevailing market standards?'
THE MARKET IS MOVING, EVEN IF HIRING HASN’T FULLY CAUGHT UP
The debate over whether previous salary should influence future pay is playing out against a changing job market. While many employers still ask for salary history, there are signs that hiring is becoming more transparent and market-driven.
Aon's Annual Salary Increase and Turnover Survey 2025-26 India found that salaries are expected to rise by 9.1 per cent in 2026, following an actual increase of 8.9 per cent in 2025. The survey also noted that fewer people are changing jobs, suggesting a more stable job market than the hiring frenzy seen after the pandemic.
At the same time, salary transparency is becoming harder to ignore. An Indeed India analysis found that more than half of job postings in India were disclosing salary information by early 2025, up from just 26 per cent in 2022. Nearly two-thirds of jobseekers said they prefer listings that clearly mention pay.
That shift could make the debate over salary history less relevant. When candidates know the pay range for a role, negotiations are more likely to focus on the job itself, the skills required and the value a person brings to the table, rather than what they happened to earn at their last company.
Candidates can compare roles more clearly. Employers can no longer hide behind vague “best offer” language. And workers can ask the more honest question: does this role pay for the work, or merely for my last job title?
SO WHAT SHOULD A FAIR OFFER LOOK LIKE?
If there is one thing experts agree on, it is that the next salary should not be a mechanical extension of the last one.
Sharma says companies should move towards role-based and skill-based pay structures, especially because business and technology are changing too quickly for old compensation habits to keep up. He argues that organisations should pay for the impact a person creates, not simply the number printed on their previous payslip.
Agarwal is more direct. He says the future is skill-based compensation, where the company defines the skills required, tests them objectively and pays according to capability and market value. In his view, anything else is just “lowballing” dressed up as a process.
That may sound idealistic. It is not. It is practical.
Because when employees say the same thing in different ways, the message is hard to ignore. And perhaps if salaries were based on skills and market value rather than past CTC, Vedant would have known much earlier where he stood. Instead, he cleared the entire interview process only to discover that his previous salary mattered more than his abilities.
And maybe the real challenge for India's hiring system may not be whether companies can ask about previous salaries, but whether they should continue to do so.
