March 31, 2022

Counter-offers – Why they’re not a positive outcome

By Jacquie Varkony and Kim Florence

Most of us can cite a memorable search – when the finalist candidate went through several interviews, references, background checks and has even received a written offer, only to be counter-offered by their present employer.  We’ve seen this happen numerous times, and it rarely has a positive outcome.

We’ve summarized some of our experiences with past narratives as a quick resource to give you insight on why a counter-offer situation isn’t often an advisable strategy for either side.

1. You risk placing a target on your back

When your employer knows that you’ve actively been looking for somewhere else to work, it’s not uncommon for their treatment of you to change. These subtle changes can slowly, or more overtly, create a level of friction between you and your company, and ultimately lead to an unpleasant experience — namely that you already wanted to leave before the offer was presented.

2. The same reasons for wanting to leave will likely resurface

Accepting a counteroffer means falling right back into the same situation you were trying to leave, only with higher pay or a different title. While your present employer may provide a clear path for career progression, improvements in job satisfaction, or solving underlying culture issues, there are a lot of levers in a company that need to be moved to change all this.  Increases in salary increases and promotions are only temporary solutions. In time, you’ll be starting your job search all over again looking for greener pastures.

3. Your future employer sees your potential

Making the effort to leave your current company in hopes that your employer will suddenly recognise your value is not a positive strategy. If more money or a promotion is offered to try to make you stay, then why weren’t you worth that before you resigned? If your future employer is willing to invest in grooming you and growing your potential and future, why not seize the opportunity?

4. The negative impact on your team dynamic

On average, around 80% of those who accept counteroffers reignite their job search within 3 months. This can lead to a negative effect surrounding morale, productivity, and loyalty to the company and your team. Imagine planning a multi-month work project with a co-worker while knowing in the back of your mind that you will not be around to help see it through.

5. Irreparable damage to your reputation with the company you were going to join and the recruiter that you were working with

When declining a formal offer due to a counteroffer, you can forget being approached again by this company or its affiliates for any future opportunities. By entertaining a counter offer, you have put the new company far behind in their timeline in replacing a pivotal role in their organization.

The reputation of the search firm that brought you in as a candidate is at risk, as is the hiring Executive at the company when you accept a counter-offer from your existing employer.

You’ve likely eliminated your chances of being included in a search with this recruiting firm in the future.

6. Great things never come from staying within your comfort zone

You may feel familiar and comfortable with your current employer, but will it bring you the career potential that you desire? Often, a change will invigorate and inspire growth and transformation.

7. Your compensation has been capped

If your employer is willing to adjust your salary when you “threaten” to resign, then not only is your employer acknowledging that they are underpaying you for your talent and efforts, but you will likely be capped at that compensation for a while, to justify the large increase.

8. Your employer may question your convictions knowing now that you can be “bought”

People who accept a counter offer often feel that they have been bought rather than rewarded for the work they have done. This dissatisfaction will eventually affect your sense of belonging to the company.

9. Counteroffers can be a stalling tactic to give your employer time to find your replacement at a lower salary

Often motivation for a counter offer is to give a company time to find a suitable replacement for the disloyal employee, and eventually replace you with a more loyal and reliable employee or hire.

Before actively getting involved in search process, consider your first interview as a barometer of your interest in leaving your present company, and reach out to your boss to enquire about your career path and where they expect to see you in 2-5 years. After this type of conversation, you can have a clear conscience about accepting an offer, should it be presented.

Some excerpts gleaned from articles written by Wendy Phan, Bell Ward, and Michael Lemmer.

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