The Truth About Counteroffers
You’ve interviewed for a position with a new company. The company likes you!-and makes you an offer. You analyze everything: career development, growth potential, salary, benefits, and intangibles. After some thought, you decide to accept the offer.
You attempt to resign from your current company. Oops! It doesn’t go as smoothly as you planned. Your boss is upset about losing you and presents you with a counteroffer. A counteroffer is an attempt by your current company to persuade you to stay.
Why Companies Make Counteroffers
Some companies never make counteroffers. In others, it’s a fairly common practice. Consider what happens when an employee (like you) resigns:
First, morale is likely to suffer, particularly among your closest coworkers. Management will notice, and your resignation may be perceived as an unfavorable reflection on your boss. Your absence could jeopardize the progress of a big project, lead to increased workloads for colleagues who remain behind, and even mess up vacation schedules! Furthermore, it could be expensive (in terms of time, energy and money) to replace you.
A cheaper “solution” for the company is to make you a counteroffer. This may consist of a raise, a promotion, change in title or job description, or a combination of these factors. It may even be just a promise of change to come.
Be aware that this “solution” may actually be a stalling technique. By buying you back, the company has bought itself some time, perhaps to finish that big project, reorganize other team members, or search for a suitable replacement for you.
What Does a Counteroffer Sound Like?
Because your company wants to attract you to stay, a counteroffer will usually come cloaked in flattery. It may sound something like this:
- “But you know we’re right in the middle of a big project! And you’re much too valuable to the team to desert us now!”
- “We didn’t want to tell you until next quarter, but we were just about to give you a raise/promotion to show you how much we appreciate your work. Why don’t we make it effective immediately instead of having you wait any longer?”
- “Why, we had no idea you were unhappy with anything here. Let’s discuss this further before you make some rash decision. Whatever it is, we can work it out.”
- “You know we have great plans for you here! But the company you’re going to work for? What can they do for you?”
Counteroffers can be tempting and ego-inflating. You also may detect an underlying threat that by not accepting the counteroffer, you’ll be throwing away your entire career, future, life.
Why Counteroffers Don’t Work
It’s true: counteroffers very, very rarely work. There are several reasons for this:
- Trust. No matter what the company says, you will forever be a “marked” employee. You have demonstrated your lack of loyalty by considering another opportunity. People will feel jilted, even if you accept a counteroffer and stay. Trust and acceptance among your immediate colleagues may be irrevocably lost. Managers, too, have long memories, and won’t forget your lapse in loyalty –no matter how brief it may have been.
- Most likely, your basic reason(s) for thinking of leaving will eventually resurface. There are a myriad of reasons why you may have considered a change: perhaps something in particular bothered you about your position, or maybe you were presented with an irresistible opportunity. In any case, changes made as a result of a counteroffer may appease you in the short term, but rarely last for the long run. Statistics show that if you accept a counteroffer, it’s still extremely likely that you’ll voluntarily leave or be terminated within 6 months to a year.
- While it may be true that your current company values your work, your interests and career will always be secondary to your boss’s career and way down on the totem pole compared to the company’s profit or survival. Reconsider the flattery that makes up a counteroffer: is it really about you??
- If your counteroffer involves an increase in money, consider the source of the raise. Is this just your next raise, granted early? In that case, will the counteroffer simply prolong your review cycle? Remember that all companies have budgets which include strict wage and salary guidelines.
What You Can Do
Rather than setting yourself up for the feelings of confusion and guilt that may arise when a counteroffer is presented, be prepared.
When resigning…
- Avoid any possible misunderstanding by submitting your resignation in writing.
- Focus on the positive opportunity you’ve been offered with your new company. At your resignation meeting, don’t feel pressured into giving reasons for resigning. Simply state that you’ve been presented with an opportunity that you cannot pass up.
- Handle your resignation right the first time you do it. Be professional and courteous, not disgruntled or weak. Offer to help during the transition time, then follow up with your best effort.
Then, after you’ve done all that you can, move forward! Look ahead to your new opportunity, complete with fresh challenges and all the excitement that goes with the start of any journey.
Good luck!
