The Dangers of Counteroffers

Written by:  Jessica Ingram

Posted: 9/6/2017

Location. Money. Culture. Leadership. These are the main factors driving employees to look elsewhere for employment. Frustrated with their situation, many of them find another job and submit their two weeks’ notice with mixed emotions. Did they make the right decision? Is the grass really greener on the other side? What about the good friends they will be leaving? In this vulnerable period, they may be influenced to change their mind by the counteroffer.

The Dangers of Counteroffers

Often, it’s a knee-jerk reaction from the company. Managers are afraid to lose good talent to a competitor so they are willing to do whatever they need to keep them happy---giving them the promotion they always wanted, throwing more money at them, promising other changes.

What sounds good on the surface usually has the opposite effect. Counteroffers rarely end happily.

A Wall Street Journal survey recently revealed that of employees who accepted counteroffers, 93 percent left their companies within 18 months.

According to other national surveys, 50-80 percent voluntarily leave their employer within six months of accepting the counteroffer because of promises not kept. The majority of the balance of employees that accept counteroffers leave their employers within 12 months of accepting their counteroffer (terminated, downsized, fired, laid off, or replaced).

At first, candidates may think: “oh great, they are throwing an extra $10,000 at me.” 

But later they realize all the reasons for wanting to leave still remain. Before jumping at a counteroffer, think through the underlying issues. 

Why wasn’t I chosen for this before? Are they really valuing me as an employee or just buying time until my project is finished or they can find a replacement? Do I really want to get a promotion this way or work for a company who reacts this way? 

Consider what it will be like when you return. Your coworkers will likely think “Hmmm, what did they get that I don’t have?” At the least, it will add an element of distrust to your relationships. At the worst, it could cause a ripple effect of corrosiveness among your colleagues, who will expect similar treatment in the future.

You have now made your employer aware that you are unhappy. The bond of trust has been broken. From this day on, your commitment will always be in question. Your boss may wonder whether your resume is still on the street.

One candidate told me all the reasons he wanted to leave. Looking for something closer to home. Looking for a pay raise. Unhappy with a few people on his team. I found him another job, closer to home. However, he accepted the counteroffer because it paid more. Then six months later, he came back to me to see if the original offer was still on the table. The company said, “no way.” He had burned that bridge.

The culture of a company doesn’t change overnight. And neither does the behaviors of most managers. So don’t think those things are going to magically change when you return.

If your complaints are purely about money, here’s a better approach before you seek another job. Have that conversation with your manager up front. Come armed with hard facts. Show them what the market is paying for your specialty in your market.

If you approach the issue that way, most companies are honest with their intentions about your role, and whether there is a mutually desirable future for you and them.  

If not, then take your career in your own hands, seek opportunities elsewhere, and don’t look back.

About the Author: Jessica Ingram

Jessica Ingram serves as an Account Executive in the DFW area at MATRIX. Jessica has been in the IT staffing industry for just over six years. She really enjoys helping her clients find the right people for their business challenges. She also loves traveling and is obsessed with Labrador Retrievers.

Read more of Jessica's articles

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