The subject of the counter offer is a very highly debated topic. If you are in a job search while currently employed and in fact entertain a new offer, it is a safe assumption that your current employer will do what it takes to keep you. And while having two companies fighting over your professional services can feel flattering, it is incumbent on you to fully understand the situation and not just take the highest offer.

This article is not written to persuade candidates to not take counter offers. To make that claim would assume I know every detail of every position for every candidate. And here is a secret: I don’t. So as far as I am concerned maybe that counter offer is the best thing for you.

However the point of this article is to make sure that regardless of your situation that you are making the most informed decision for your career. If you are just looking at the dollar signs and making a decision from there you are sacrificing your long-term career goals for quick results.

So my attempt in this article is to break down the anatomy of what makes a counter offer. By better understanding a counter offer, it will hopefully lead to more enlightened conversations, and in turn making the best decision for your career long-term.

First we need to understand that counter offers are typically made from a reactionary position and not of what is in your best interest. Meaning, a counter offer is only being made because they are reacting to keep you; whereas if they really wanted to reward you for your performance, these conversations would occur without you having to threaten to leave. So while offering you more money may seem like having your best interest in mind, what your employer is really doing is just buying your loyalty for a little longer. Are you really that cheap?

Now let’s dive into the counter offer conversation itself. There are a plethora of questions to ask when the topic of a counter offer arises. If you’re not asking informed questions during that discussion, beyond “how much money can you offer”, than you are only hurting yourself. Below I highlight some of those important questions you should be asking.

  1. You just got a salary increase. Where is this money coming from?
  2. Since you are getting this money now, will you be eligible for any scheduled bonuses in the future?
  3. Why are you only receiving an increased compensation now? Why weren’t you worth this money before telling them you were leaving?
  4. With an increase in money, are there now greater responsibilities being placed on you? Are you expected to perform at a level above you even though you may not be ready?
  5. Occasionally it’s not just money, sometimes you may ask for an increased level of responsibility. Would these increased responsibilities be available if you didn’t threaten to leave?
  6. How does this affect the working relationship? Will you now be the first one let go if the company starts experiencing layoffs? Does management no longer trust you?

If your employer cannot confidently answer these questions, the red flags should be waving frantically. Remember, counter offers are made from reactionary points of view, so if they are really just trying to buy your loyalty, than that’s all it is, they are just purchasing you. You aren’t necessarily looked at as an asset as much as you are holding a seat they cannot afford to be empty. If they really do not want to lose you and would like you to be a valuable member of the team, these questions should be easy to answer. And in those cases I cannot fully say the counter offer is a bad thing.

There are many statistics out there about how long employees last with their employer once a counter offer is made. The majority of the time people do not last 6 months to a year after a counter offer because the trust is gone and they have already began looking for a replacement. The reasons vary on why this is the case, but the root cause is because trust is broken. So it is important that you have a well thought out conversation to determine your future rather than take whatever money is being thrown at the higher number.

As I mentioned earlier this article isn’t to tell you to take the offer or not. It is merely informing you of what you need to be asking if the subject comes up. Because ultimately this is your career, which by normal standards should last a few decades, so you should not be looking at the quick fix as much as what makes sense in the long run.

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Comment by Linda Ferrante on April 16, 2014 at 9:08am

Money generally isn't the issue/concern behind a counter offer.  The most important thing is to ask yourself WHY you wanted to leave and IF your current employer can rectify any if those issues.  Most likely, the answer is no.

Management isn't going to change other management because you don't like them.  They aren't going to change your hours, they aren't going to move closer to where you live, they aren't going to pay for more of your benefits or implement a 401k plan, they aren't going to make you a VP because you want it. 

IF they offer you more money, it's most likely to buy time to straighten things out for WHEN you do leave.  Bottom line, if you are thinking about accepting the counter offer, it's more than likely a short lease on that extra cash. 

Make a wise decision BEFORE you go to your current employer with your notice.  

Comment by Keith D. Halperin on April 16, 2014 at 10:19am

Well said, Linda.


Comment by Steven Guine on April 17, 2014 at 10:15pm

Crises management 101. Throw money at the probl errr... employee in order to buy time in order to replace them. It is a time tested strategy which works more often than not. The employee which falls for it has only themselves to blame when they are jobless and the company they turned down ignores their calls/e-mails.

Of course there is a reason an employee looked for a job outside their company. It's because they are unhappy. The savvy recruiter gets to the heart of the reason why in order to make their close easier (and their counter close conversation with the candidate airtight) later on.


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