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Counter offers can be confusing. Leaving a job, especially one you’ve held for some time, is difficult. Being put under pressure to stay, and having your reasons for leaving challenged or undermined, does not make it easier.
As enticing as a counter offer may be, it’s important to keep a clear head, take a step back and consider your options.
What is a counter offer?
A counter offer is an offer from your current employer to rival the one you have received from another employer. The aim of a counter offer is to convince you to remain in your existing job and decline your new job offer.
Counter offers can take many forms, from a straight salary increase to additional company benefits, a sought-after promotion, a new job title, additional responsibilities, a change in role, more involvement in projects that interest you or any combination of these.
Why did you want to leave initially?
People leave jobs for a range of reasons, from a lack of new challenges to career advancement and a desire to feel valued. After some careful contemplation, you concluded that, for whatever reason, you weren’t happy in your current role and decided to leave.
Why then would a pay rise, new job title or additional benefits be anything other than a superficial tactic to convince you to stay?
Remember, you wanted a change and your motivation must have been genuine since you not only looked for a new job but applied, interviewed and accepted one. These are not the actions of someone satisfied in their current role. Clearly, your decision to leave was made a long time ago.
Why employers make a counter offer
It’s flattering when your boss makes a counter offer upon hearing of your decision to resign. But if you look at the situation objectively, you’ll see that recruiting a replacement for a vacated role can be time consuming and costly. We are all time-poor, your boss included. They could also lack the budget to recruit and train a replacement. Or perhaps they’d rather you finish the project you’re working on or simply don’t want to lose a staff member right now.
Therefore, if there’s even a small possibility of avoiding interviewing, onboarding and training someone new, your boss will take it. Ultimately, it’s more cost and time effective to attempt to reverse your decision to leave that to find a replacement with the right skills and cultural fit.
Do counter offers work?
Statistics show counter offers rarely work. Our annual Hays Salary Guide consistently finds that of the staff counter offered in the previous 12 months, on average around 46 per cent leave anyway, 4 per cent accept the counter offer but stay less than three months and 21 per cent remain between three and 12 months.
Just 29 per cent, on average, stay longer than 12 months.
When to accept a counter offer
Those in the latter group have employers who actively seek to address the reasons that drove them to accept another job. Rather than offering a hollow new job title or a few additional benefits, they make real change that motivates, engages and develops the career of their employee.
Just ensure genuine action will be taken to rectify the issues. Counter offers typically include material perks, such as a higher salary or greater benefits. But they often don’t acknowledge the deeper reasons behind your motivation for looking for another role elsewhere, such as a lack of true workplace fulfilment, a passion for what you do, the opportunity for personal growth or a sense of purpose. These are the things that material benefits can’t make up for.
If you can agree to overcome the reasons you decided to leave, and your motivation for leaving is beyond just a salary increase, accepting a counter offer could provide a great opportunity for you and your career. However, this will only occur if your motivations for leaving have been indisputably dealt with. Otherwise, you’ll find yourself job searching again soon.
When not to accept a counter offer
There are many reasons not to accept a counter offer. In fact, most people who accept a counter offer find themselves resigning again within a year.
Why? Typically, their original motivations for looking elsewhere are not adequately addressed and their career sits in limbo. Engagement and motivation fall. Trust no longer exists with their boss. Furthermore, their employer demands more from them because of their new salary package, even though, in their eyes, the counter offer was a fair reflection of their performance.
Another factor is the organisation’s culture and your manager’s leadership style. Ask yourself why your boss didn’t offer you what you deserve before you resigned.
For these reasons, don’t accept a counter offer if you are not completely certain the above factors won’t derail your career. Remember, if you don’t trust that genuine change will occur, the counter offer is hollow. In this case, in the interest of your career advancement it might be best to thank your boss for the offer and move on.
How to negotiate a counter offer
Don’t be blindsided by a lavish counter offer. If your boss makes a counter offer, ask for a day or two to consider.
During this time, reflect on the reasons you looked for a new role initially. Write down what you are looking for. While salary and benefits are important, also look beyond the material perks. For instance, perhaps you want a better workplace culture, supportive boss or career progression. Think honestly about what you want from your career and what your current employer needs to do differently to achieve it.
Then, schedule a one-on-one meeting to discuss the practical actions your boss needs to provide to convince you to stay. You are in a strong negotiating position – you have another job offer and do not need to compromise. If your boss really wants you to stay, they’ll offer more than money. They’ll provide a genuine commitment to tackle the issues you raise.
For example, if your current role lacks long-term career growth potential or you feel unchallenged and bored, your boss will work with you to develop a long-term career plan and revise your duties and responsibilities.
If you and your manager cannot agree to the changes you want, move on while you have an exciting new opportunity open to you.
Look to your future
If you've handed in your resignation and received a counter offer from your current company, it's important to consider the pros and cons of accepting the counter offer.
While every situation is unique, consider your motivations for looking for a new job in the first place and question if the counter offer is really worth staying for.
If you still decide to leave, take the counter offer in your stride. Thank your employer for the opportunity and reaffirm your intention to leave. Stand your ground.
If you decide to stay, be aware that your resignation will not be forgotten. You will have to work extremely hard to win back your employer's trust. You might have to strive harder than your colleagues to prove your loyalty as a long-term employee. Your new post-resignation life with your old company will not be easy. Good luck.