Counter-Offers, And Why They Are Baaad, Very Bad!

Recently, a candidate approached me to help him find a new job. The company that he was currently working for was cutting back his responsibility level and his take-home pay was dwindling. The candidate, “Bob”, knew that the company was in bad financial health.

I liked Bob. Thought he was a great candidate to market. So, I worked on his resume, tweaking it to perfection. Coached him on interviewing. And once he was all polished and ready for presenting, I began marketing him to some hiring authorities. Got a hit! A client company was looking to hire and was very interested in Bob’s qualifications. My client was very thankful that I called them about Bob’s candidacy and the first interview was scheduled, lickety-split. After three interviews completed, Bob was given a super offer. How smooth was that? Wait. There’s more!!

Bob called me the next morning. He declined the offer. What the heck? You got it. DECLINED. And here is why:

The failing company that Bob felt strongly was going close operations any day, came back to Bob with a counter-offer. The offer was, in Bob’s words, “Too good to be true.” Tripled his salary, plus a cash bonus of $5k. Bob drank the Kool-aide and accepted the deal. When I asked Bob the most obvious question, “Where did they get all of this money to pay you that salary, not to mention the bonus?” He replied, “They re-worked some of the numbers and *snap* found they could pay me more.” The snap sound was my neck popping.

Lesson learned: I should have prepared for this on day one. Alas, my failure to do so really cost my client a lot of time and effort. I am disappointed in myself, but ready to make it right with my client. Already I have sourced two candidates for the position Bob declined to accept. All better.

Here’s what I know: This is the last time I will make that mistake. Going forward, here is what I want you to know:

1). Before you resign from your current position, arm yourself with reality. Remind yourself of all the reasons why you were looking for a job in the first place. Lofty promises and cash thrown at you will never change the fact that the reason you were looking to change jobs still exists. And,

2). Your employer now sees you as a disloyal member of the team. You lost any at-a-boys collected with past achievements because you looked for a job on company time. You focused your time and energy on interviewing while being paid to work. Traitor! You are scum. And, more importantly

3). However long it takes your current boss to find your replacement is how ever long you have left at the company. That is a promise. You are no longer in control of your career destiny.

Bottom line, counter-offers are 95% empty attempts to “band-aide” the situation. You are being bribed to stay. And by staying, you provide the company plenty of time to find your replacement. Trust me, they will use the time wisely and probably will find a BETTER you. Then you, dahling, will be summarily fired without that sweet two-week notice you were prepared to give.

If you are that concerned about taking the counter, ask yourself this, “Why didn’t you get that kinda cash/promise before looking for another job?”

Maybe I will post again when Bob calls me saying that the “too-good-to-be-true” counter-offer was just that…too good to be true. Maybe not. I need to move on. *smile*

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Comment by Sneh on October 19, 2011 at 6:08pm: Bill Schultz - I like the idea of the ''resignation package' you share with your candidates. Great idea and I can see the value of it...specially educational when shared at reference check stage than after the fact.

Would you please email me a copy via my profile page or directly to me on sneh.paul@actright.com.au

thanks

Comment by Gavin Chase on October 20, 2011 at 11:29am: As a recruiter you should always deal with the 'what will happen when you resign' question in the 1st conversation with a candidate. Qualify the question by asking 'what normally happens when someone resigns'? Its at this point you can outline the negative affect on someones job at their current employment.... revisit the question at least twice more during the process with all candidates. Assume nothing with candidates. Get them to tell you that the counter offer will never happen with them. You will have less failures via the old headache of counter-offers.

Comment by Roy Tapia on October 20, 2011 at 3:33pm: Hi SeSee, I am new to the blog and the first article I read was yours. I've been recruiting nearly 20 years and found your article to be absolutely spot on. I go through this with EVERY candidate from the get go and unfortunately, there are those who just don't get it. The only thing I can think to add to your great observations is this: what makes candidates think that, in accepting a counteroffer, the reasons they were looking to get out of a company in the first place...will go away. Their income may change, but the reasons for the misery won't. Thanks SeSee and look forward to contributing to the site and hearing different perspectives from industry colleagues.

Comment by Ben on October 21, 2011 at 10:32am: I have a read a few posts like this over the last 12 - 18 months. The pattern I notice is that "how to handle counter offers" coming from people with only agency-side experience is always the same i.e. DON'T ACCEPT THEM! I used to belong to this school of thought in my agency days. From a consultants perspective they are flippin' annoying when they happen. Oh I remember the feeling of utter frustration (boardering on rage) when they used to happen.

All recruitment consultants are trained (or should be) on how to head potential counter offers off at the pass. It doesn't matter how folks try and suger coat this, the main reason consultants do it to protect their commission. Often it isn't with the candidates best interest at heart.

You know what... Following my first few months as an in house recruitment manager for a large brand by attitude towards counter offers shifted dramatically. They are NOT all bad. And candidates SHOULD accept them if a number of variables are in place. I won't go in to too much detail hear as I wrote a post about it on my blog a while ago. If anyone is interested in another perspective from someone who had 12 years agency-side and 5 years client-side read here - I'm Gonna Make You a Counter Offer you Can't Refuse:

http://www.trecknowledgy.com/interview-advice/im-gonna-make-you-a-c...

Hope you enjoy

Comment by Mitch Sullivan on October 21, 2011 at 10:56am: I see this sentiment about counter-offers expressed on the Internet a lot. What I've never seen is any kind of data that backs it up.

Does anyone know if any exists?

Comment by Noel Cocca on October 22, 2011 at 1:36pm: @Ben - well said Ben. I have been agency only most of my career but have seen your side also.

Comment by Barbara Goldman on October 26, 2011 at 12:27pm: I have seen some very rough counter offers. Sometimes, it's hard for the candidate to grasp that playing golf with the president of the company is not going to be a daily event. Being invited along with your spouse to the country club, along with a small gratuity of a raise is hard to resist.

How about when your boss looks you in the eye and asks: Why didn't you come to me first?

This is a good one: I can't believe you are going to XYZ, I turned that job down a year ago.

I never fault the candidate when we lose to a counter. In every case, I knew in my heart that the candidate wasn't solid. Sometimes the emotional impact of the counter is so overwhelming, it's hard to resist. "They Love ME, They REALLY Love ME"

When I have the feeling that the candidate is on shaky ground, it's my fault to believe that the result will be a positive one for me.

One of the heartbreaks of the business. Good post! Thanks

Comment by Sean Malek on November 1, 2011 at 8:42am: Good post SeSee. Thanks for sharing it.

@Bill S., I am interested in looking at your resignation package offer and how I can improve at this. Please feel free to send me a private message via my profile page so we can exchange addresses. Thanks in advance.

-Sean

Comment by Martin Perinne on November 1, 2011 at 12:53pm: Great post, I have been recruiting for the past 7 months or so with Metric-X, http://www.metricx.com/services-and-solutions/talent-placement, and things similar to that has happened a couple of times. Biggest lessoned I have learned from this is the placement is still open until the candidate starts!

Comment by Mike Auton on November 17, 2011 at 9:17am: We have all been here, it hurts like hell, but we get stronger for the experience. Learn from this and in the long term you will profit ten fold.

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