XPG Insights

Staffing industry recruiting news, advice and thought leadership.

XPG Insights

Staffing industry recruiting news, advice and thought leadership.

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A Counteroffer Might be Counter to Your Best Interests

When we talk to a potential candidate at XPG Recruit, we spend a significant amount of time on why they’re looking for a new role. We ask questions so we can get a feel for what they’re looking for – and for what they’re hoping to leave behind in their current job. We hear a lot about opportunity, growth, building skills, and taking on new challenges.  We sometimes (not often) hear stories about why they’re leaving, as well: dysfunctional teams, toxic bosses, and companies who don’t seem to acknowledge or appreciate their workers’ efforts. 

We end by asking them a question they may not have considered before: What will you do if your current employer makes you a counteroffer?  

Counteroffers have always been part of some companies’ efforts to retain talent. And as the current labor shortage continues and intensifies, more and more companies will consider counteroffers as a last-ditch strategy. They’re almost never a good idea for either party. Here’s why. 

Employee surveys indicate that only 12 percent of people resign with money as the primary motivation. It’s rare, but workers have been known to apply for jobs to “test the market,” using the offer to try to leverage more money from their current employer. Even if the idea never occurred to you, it may occur to your employer or your coworkers. They may also resent seeing your pay increase after threatening to leave, when those who are staying are not rewarded for their loyalty. It can make for uncomfortable working relationships. 

Executive search firm Heidrick & Struggles conducted a national survey of over 700 HR professionals about resignation best practices. Asked to check off negative consequences of accepting a counteroffer, nearly 80% of senior executives and 60% of HR leaders cited “diminished trust and compromised reputation” among the executives of the employee’s current company. And 71% of senior executives and 67% of HR leaders said that “superiors in the current company would question the employee’s loyalty going forward.” 

Their reasoning is sound; if you were willing to leave for a better offer today, what would stop you from accepting one tomorrow? Almost all HR professionals agree that counteroffers only delay the inevitable; most employees who accept them leave within a couple of years anyway. In fact, in a survey of our clients, they reported that 60% of employees who accepted a counteroffer left within six months. 

Even if you agree to stay and you’re making more money, you may eventually see opportunities for challenging assignments and promotions drying up, going instead to workers who haven’t tendered a resignation. Once your manager’s trust is broken, it can take a very long time to rebuild.  

And your current employer won’t be the only one with trust issues. If you have accepted and then reneged on the new company’s offer, your reputation with that company will be tarnished as well. They’ll wonder whether you were sincere in your intent to work with them, or if they were just being used to make your current employer to come up to scratch. They feel like the rebound girlfriend you dated to make your ex jealous. Intended or not, it’s not a good look for you. 

We always say it’s better to never let it get to the point of a counteroffer. If you’re thinking it’s time to move on, ask for a meeting with your boss to talk about your career goals and what you’re hoping to achieve in the next few years. Then ask if they think your current company or role will provide what you need. If the honest answer is “no,” you’ll have clarified your reasons for making a change, both to yourself and your manager. You’ll also have laid the foundation for moving on with grace and honesty. 

 

About the Author:

Rich Thompson, CEO of XPG Recruit, is an expert on staffing, human resources, training and leadership development.  For consulting to increase engagement and/or retention, check out the services of our sister company, Xtra Point Group.

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