The Counter Offer

Companies have been known to successfully reclaim an employee who has accepted a job offer elsewhere.

The employer refuses to accept the resignation. He bends over backwards to understand the source of her discontent, agrees to solutions, raises her salary, shows concern.

The employee is overwhelmed and flattered at her employer’s dismay and eagerness to exceed the job offer. Finally, her contribution to the company is being acknowledged.

And so she forgets momentarily why she wanted to move on – all those opportunities and new challenges that were absent in her workplace. She stays. Chances are, she’ll remember them again soon.

Chris Laubitz, partner of the executive search firm Caldwell Partners, believes that counteroffers are counterproductive to both parties.

“Organizations are learning the hard way that counter-offers don’t work in the long run,” Laubitz says. Part of the reason is that counter-offers rarely solve the employee’s dissatisfaction, the very same dissatisfaction that caused the employee to search for another position in the first place.

Another unfortunate aspect of successful counter-offers is that they implicitly require unprofessional behavior on the part of the employee.

If a counter-offer is accepted, the employee is obliged to renege on his commitment to the other employer, who usually vows to close the book on that candidate forever. And if that is not bad enough, the employee must also live with the implication that he used an employment offer to lever his position with his current employer.

And despite the employee’s good intentions, the implication holds some truth. When the dust settles and the employee is once again ensconced behind the desk, his or her reputation has been scarred. This is an employee who broke stride, left, was wooed back with effort and money, breaking a promise to another company in the process.

Despite the no-win premise of counter-offers, they continue. Companies pursuing high-calibre candidates can mitigate the possibility of a successful counter-offer by frankly discussing its possibility, meaning and response with the candidate. To reduce the chances of an offer being used to obtain a counter-offer, companies can also extend a verbal offer for acceptance before providing a written one.

Once the candidate has verbally accepted the offer, the hiring officer should meet with the candidate to discuss logistics like start date, and help the candidate prepare for the possibility of a counter-offer.

Job offers are not opening gambits for discussing one’s future with a current employer. Offers of employment should be evaluated on their own merits by the individual, then accepted or rejected. A counter-offer should be graciously acknowledged as part of the kudos that presages the next step in a professionally managed career.

Employers are not impartial career counselors, nor are their needs always aligned with those of the employee. In many cases, counter-offers are emotion laden personal appeals. To counter this, it must be appreciated that employers operate in the best interests of the company and that, despite all protestations, they will survive the employee’s departure. The timing seldom suits the employer and therefore every effort is made to buy the necessary time. Research by the Wall Street Journal has shown that the vast majority of employees accepting counter-offers, left within 10 months, seldom of their own accord.

Counter-offers require the employee to break an employment agreement with another company. If this is unprofessional, then surely both the employer and employee should share this indictment. It is unethical for any company to expect an employee to behave in an underhanded manner.

Source: Live Asset Management Services (LAMS)
Sandton, South Africa