With record low unemployment and one of the tightest labor markets in years, we are seeing a significant increase in counteroffers. In many cases companies are throwing 20-50% salary increases at individuals to get them to stick around.
For a moment let’s not talk about the inherent issue with organizations only acknowledging your true value when you tell them you are leaving. If they have always felt you were such a valued member of the team, why did they wait until you resigned to pay you what you were worth?
Some companies have a strict no counteroffer policy. They understand that if an employee went through all the trouble of finding a new job, they obviously don’t want to be there. So, they work with you through a professional transition and wish you the best of luck with the next steps in your career.
But in many organizations, if you are good, you will probably get a counteroffer when you tell them you are leaving. Companies have very specific strategies for counteroffers and yours will fall in one of these categories. Keep in mind how convenient it is that all of these things happen JUST as you are ready to leave.
Love/Guilt Trip:
You can’t leave! We are family! They will literally try to guilt you into staying.
More Money:
This one is simple: You are so important to us! What will it take to get you to stay?
Promotion:
We hadn’t told you yet, but we have been considering you for a BIG Promotion and were going to announce it next week, next month or next quarter… Let’s just move the timetable up and give you more money and make you the Manager, Director or VP of whatever NOW because you are SO important to us.
Secret Project:
A lot like the promotion, there is a Project or Corporate Initiative we have been discussing that we want you to lead. It’s so secret we haven’t told anyone about it, but we will roll it out now because it’s so exciting YOU won’t leave if you know about it. And of course, more money comes with it too.
Any of these may seem great to you. Especially because inertia is in the companies favor. It’s hard to make a change and staying put is comfortable. But keep in mind that it is temporary. Most of the time, the company will be resentful after the dust clears in 3-6 months that they gave you so much to stay. The expectations for your performance change and are much higher. There won’t be another promotion in 12 months and your loyalty to the company may be questioned in the future.
Counteroffers sometimes work long term. And there are very real short term benefits. But the data shows that with 12 months you will likely be gone anyway. Often sooner than that. Keep these tactics in mind and weigh if the short term benefits are worth burning a bridge with the other company that thought you were great and made a strong offer to bring you over.
If you are interested, here are a few articles about why counteroffer’s usually don’t work and what to consider when you receive one.
Harvard Business Review: https://hbr.org/2019/01/if-youre-about-to-take-a-new-job-should-you-consider-your-bosss-counteroffer
Forbes: https://www.forbes.com/sites/jackkelly/2019/01/25/what-you-should-do-if-you-get-a-counteroffer/#dda8d119ce44
Even the Society for Human Resources Management indicates that Counteroffers are a short term fix at best and usually don’t work: https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/do-counteroffers-make-sense.aspx