Counter Offers: Good or Bad?

As a recruiter, I encounter many job seekers who are willing to explore the job market but may not have any apparent reasons to leave their current jobs. These group of job seekers are the most likely to drop-out from a hiring process, even at the offer stage, because they are more likely to accept a counter-offer from their current employer. However, is it a wise decision to accept a counter offer? Will the underlying issues that prompted a person to passively explore job opportunities disappear or improve with the counter offer? Or is it all due to fear of change?

Having spoken to many job seekers and understanding their motivation and needs, these are some common reasons that prompted people to seek new job opportunities, either actively or passively:

• Feeling underpaid or unappreciated
• Slow or no career progression
• Long working hours
• Bored with the job scope
• Political culture
• Bad boss
• Distance to work

Whatever the reasons, as a job seeker, you would have attempted to resolve some of these underlying issues. But certain things are beyond your control, so would the problem disappear after accepting a counter offer from your current employer? Very highly No. 

Many job seekers who accepted counter-offer would, for various reasons, return within months to start their job search again, because counter-offer is a short-term solution to long-term underlying issues. Statistics have shown that four out of five people who accept counter-offers are gone within the year.

Here are five good reasons to accept a counter offer:

1. You do not expect to stay at your current job for a long time — for example, because your spouse is in grad school and you know you'll be leaving the area within two years. You want a higher salary or something else from your job (a bonus or a schedule change, e.g.) and it takes a competing offer to get your manager to do the right thing.

2. You weren't job-hunting, but a recruiter contacted you. You went on the interview to check it out and you got an offer that's much more competitive than your current pay and benefits package. You don't really want a competing job. Why not bring the offer to your manager? It is ammunition for him or her to help you get paid what you're worth.

3. Your company is in flux and your skills are needed there more than ever — but salary increases are also on hold as a matter of policy until the transition (a merger, e.g.) is completed. Only a competing offer will get you a pay increase now! If your managers are miffed that you used a counter-offer to get them to wake up, that's okay — they don't need to love you, only to respect you and value you appropriately. No job is forever. All of us use successive jobs to ratchet out way up to the salary and position we deserve.

4. Your job description is so unique that nobody knows what the job should pay. You conduct your own research by surveying the talent market, talking with recruiters and going on job interviews. You get a job offer that pays significantly more than you are earning now. Why not use the offer to educate your boss about prevailing salary rates for folks like you?

5. Your gut says "Take the counter offer." Your trusty gut is your best guide!

Now that you're re-committing to your job, why not take the next step and lay out a road map of projects you're going to tackle over the next year, the career progression, the team growth? That road map will be helpful to you and your boss. You are growing new muscles — the very best thing for every working person to do!

So, here are the 10 reasons why you should NOT accept a counter offer:

1.     Nothing changes except your salary. The underlying issues that prompted you to consider other job opportunities will remain there – things and people don’t change overnight.

2.     Your future employer sees a potential in you that your current employer does not see. Taking on a new hire is a risk, for both the employer and employee. If your future employer is willing to take the risk to groom and grow your potential and future, why not seize the opportunity?

3.     Great things never come from staying within your comfort zone. You may feel familiar and comfortable with your current employer, but does it bring you the job satisfaction that you desire? Often, a change will bring growth and transformation.

4.     You have not been paid what you are worth for. If your employer is willing to adjust your salary when you “threaten” to resign, then your employer is knowingly underpaying you for your talent and efforts, an indication of non-appreciation of their employees.

5.     Are you bringing forward your bonus/promotion/pay rise now rather than when it’s due? Most companies have strict pay scales for each level and position, so you might end up having a lower adjustment when your next pay revision or review is due. Would you be happy then?

6.     Trust likely be broken between you and your current employer. Often, resignation is seen as “lack of loyalty”, and your current employer may now question if they can count on you, which will limit your future growth.

7.     Your employer may question your convictions knowing now that you can be “bought”. People who accept a counteroffer 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.

8.     On average, around 80% of those who accept counter-offers to reignite their job search within 3 months. You may genuinely still do your best for your current employer, but your employer and co-workers may treat you differently now that you have shown a “lack of loyalty”.

9.     Your “lack of loyalty” may likely put you at the top of the pile when they are looking to reduce the number of employees when times get tough.

10. Counteroffers are usually just a stalling tactic to give your employer time to find your replacement at a lower salary.

In the end, if you decide to accept the counteroffer, my advice is to get everything you want in writing from your current employer, discuss the future projects, see your scope in the company for the long term, have a goal to move to next level. It is also important to be professional and end things gracefully with your future employer and recruiter that worked with you on the new job opportunity – it’s a small industry, you never know when you will cross path again.