I have heard a lot lately about counteroffers and started wondering if it’s a good idea to seriously entertain one if it’s offered when you announce your intention to leave your current position.
The first thing I learned is that counteroffers have become pretty common. According to a survey by Robert Half, 58 percent of senior managers extend counteroffers to keep staff from leaving.
“The market for skilled professionals is tightening, and companies are focused on attracting and retaining top talent,” explains Marilyn Bird, district president of Robert Half in Chicago. “The primary reason is to prevent the loss of institutional knowledge — and because they don’t want to spend time or money hiring a replacement.”
And these offers can be tempting to take.
“Counteroffers can be attractive because professionals can remain in a familiar work environment while making more money,” says Bird, who stresses that any counteroffer should completely address the reason you want to make a move. “For example, if a professional loves everything about his or her job but needs to move with a relocating spouse, the opportunity to work remotely full-time may be a reason to consider the counteroffer.”
But the cons can outweigh the pros, according to Bird and Steve Docter, an executive recruiter with Paladin in Milwaukee.
“When an employee is unhappy in their current role, accepting a counter offer will do nothing to change the situation,” Docter says. “They’re just being paid more to stay in a company where they feel unappreciated.”
“Employees need to carefully examine whether the counteroffer will truly enhance their long-term job satisfaction before accepting it,” Bird adds.
In addition, accepting a counteroffer may indicate you’re only interested in making more money and will always be waiting for the next better offer, Docter warns. “Now you are walking around the office with an “X” on your back as your current employer is calling ME with a confidential search to replace you.”
Bird offers the following list of cons to consider before accepting any counteroffer.
–Most counteroffers don’t address the root issues that prompt an employee to want to leave. “According to a recent survey by Robert Half, professionals who accept counteroffers typically end up leaving the company in less than two years,” Bird says.
–The counteroffer may be a quick-fix. However, as Bird notes, employees who accept counteroffers often realize that the same elements that led them to look for a new job in the first place still exist. “For example, if an employee feels a lack of challenge or has outgrown his or her position and the company, a better compensation package won’t remedy the situation. And that employee may end up leaving a few weeks or months down the road,” Bird says.
–There may be resentment from colleagues who didn’t receive a raise or promotion.
–You could damage your credibility with both your prospective and current employer. “If you back out of a commitment with another company, you’re burning a bridge with that company,” Bird says. “Moreover, your current supervisor may question whether you’re using the [new] offer as a strategy to secure a raise or promotion.”
(Article written by Kathleen Furore)