Should You Accept a Counteroffer?
If you’re considering resigning from your position for a better opportunity, understanding what really happens behind the scenes, could help you avoid a bad situation. Before we extend offers, we ask candidates how they will handle it if their employer makes a counter offer. Most of the time we hear, “Well, that’s not going to happen,” and frequently it does happen. If you’re a competent professional, it is a matter of time before you experience a counter offer dilemma. If you aren’t prepared in advance, you’ll certainly make mistakes. So if you want to resign without burning bridges, or disrupting your career path, consider the following advice. Gaining a realistic perspective on the reasons employers make counteroffers will prepare you to handle your decision appropriately.
Turnover is Costly:
Today, it is more difficult and costly to replace the departing employees than ever before in history. There are many reasons we won’t go into here, but know there is a shortage of talent, especially in construction. As a result, it is much easier for an employer to convince you to stay than to recruit and train a new employee. It’s also more expensive than simply giving you a raise. Also, remember, your employer’s moral and practical obligation is to do what’s best for the company, and the team, not just for you. Your obligation is to do what is in the best interests of you and your family. Only you are qualified to make those decisions.
Managers Look Bad When People Resign:
When an employer makes a counter offer, it’s almost always a selfish move on their part. Business owners, Presidents and CEO’s don’t like turnover, and they hold managers accountable for retaining top people. So it shouldn’t be a surprise to you that your manager would want to keep you, but not for the reasons you might hope. While difficult for some of us to hear, your employer’s efforts to keep you are more about managing turnover than how much they want you, personally, to stay with the company.
When you resign, work load increases for co-workers, and often for the person to whom you report! Because it takes longer to find a replacement these days, a successful counter offer is a short term fix to prevent the pain. If you agree to stay, you can bet your employer will be keeping an eye out for someone who can fill your shoes. The trust is gone, and it’s nearly impossible to get that back. So every time you have a doctor’s appointment or take a vacation day, your boss will wonder.
Know the Statistics:
Research conducted by Wall Street Journal, revealed that 90% of candidates who accept counter offers were terminated or left their employer within 12 months. While that research was conducted years ago, we believe the numbers are still high. Over the course of a year or so, we rarely see a positive outcome for a candidate who says yes to a counteroffer. Why? The fundamental reasons most people switch jobs doesn’t change after accepting a counteroffer. Most people leave their jobs for reasons other than money, and if money is the ONLY reason, you should NEVER have resigned in the first place. Counter offers are typically a bad deal for you, but a good deal for the employer, because they “buy time” to find a replacement by keeping you a little longer.
Be Prepared for Your Boss’ Reaction:
When you resign, your manager will first be concerned about how your resignation reflects on them. They will attempt damage control with a very predictable reaction. First, they will say they are shocked, or couldn’t see it coming. Second they will express their sadness to see you go, and they may reflect on what a great friend you’ve been to the company. Next, they will start questioning your thought process. They may say something like, “Have you really thought this through? Do you really know what you’re getting into at XYZ company?” Fourth on the list is the “hidden promotion or special project. “Wow the timing is terrible on this. I was going to wait, but I guess I should tell you now, we were going to move you into the Director role you’ve been wanting.” Finally, they will use the stalling tactic. “Can we keep this confidential? Can you give me a few days, before we announce this? I’d really like the opportunity to discuss this with the President, and get back to you.” Also, they may ask you for details on your financial offer. Take it from an executive we placed recently, never ever provide this information. It may feel good at the time to brag about your increase, but resist the urge. If you’re a wise decision maker, you don’t need your boss to second guess your decision and try to match your offer. Worse yet, they may criticize you for taking such a “small increase,” when its really just a tactic to get you to consider their counter.
Accepting a Counter Offer Means Accepting the Negative Consequences:
Finally, understand the consequences of accepting a counter offer. Honestly, it’s a big boost to your ego when your employer tries to keep you. If you felt unappreciated before the counter offer, it is very rewarding to feel sought after and valued, but I assure you it doesn’t last. Even if you improve your employment status with more money or promotion, you’ll deal with other negative dynamics. Your employer may feel “blackmailed,” and your co-workers will resent that you got a bigger paycheck for being disloyal! We see many examples where employers actually make up these increases by cutting your bonus or reducing increases in the following year. You could also run the risk of being demoted, after a period of time, or worst case, terminated, once they’ve had a chance to replace you. A great example of this is a tax accountant I knew who resigned during busy season, the firm gave him a huge bonus to stay with the firm. A few months later, when the annual bonus was paid out, he got ZERO. To add insult to injury, he was terminated a few months after busy season, so the firm had plenty of time to replace him.
Most of the time the original reasons you made the decision to make a job change are still there, and they don’t change just because you accepted a counteroffer. More money is rarely the reason people leave professional roles. You should have more faith and trust in your own judgment. There were good reasons you accepted the new position, so it’s highly likely the best decision is to follow through. Remember, it won’t take long to regret your decision, if you allow your ego to take over. Don’t let money cloud your judgement about the reasons you wanted to resign in the first place.