Source: White Horse Employment
You nailed it! You’ve gone through the interview process with flying colours and your new prospective employer has offered you the role. It’s time to make the decision of should I stay, or should I go?
Now cue the counteroffer!
What is a counteroffer?
The counteroffer is an offer made in response to another offer. In a recruitment situation, it refers to an employer’s response to retain a valued employee from leaving the business, typically occurring after the employee has given their notice.
A counteroffer can include a salary increase, a promotion (or at least a promise of one), more flexibility, additional opportunities or responsibilities. No matter how alluring a counteroffer may seem, it is crucial to remain objective before accepting or declining.
Let’s delve further into the counteroffer in this post and uncover why some individuals accept it while others do not. Given the significance of the decision, it’s not as cut and dry as one might think.
Source: OneStaff
Reasons to accept a counteroffer
Statistics show that 57% of employees accept counteroffers that are made to them. In a recent poll we conducted here at Prior and Hall Recruitment via LinkedIn, we found this percentage to be closer to 70%. Below are some of the reasons to support your decision to accept a counteroffer:
1.) Greater sense of worth within the business
Following the acceptance of a counteroffer, you may feel your worth within the business has been reinforced. It’s important for employers to regularly provide feedback and acknowledge the good work of their people. This comes from strong leadership as well as a good work culture. Remember, there will be situations whereby your manager doesn’t know what you’re thinking or truly understand your aspirations or goals. Through this process, you might learn to voice your thoughts, feelings, and goals moving forward as it will likely support future career growth.
2.) Avoid the 'Restart'
You can stay in your current job and/or employer when you accept a counteroffer. It likely means you don’t need to adjust to a new routine, work environment, build relationships with new teammates, or learn to work under a new leadership style.
There are many layers of anxiety and/or uncertainty that can come with changing roles and organisations. I know firsthand there are some environments where I have excelled and others I have not. Whilst you don’t want to be stuck by fear, you need to truly understand what you want out of changing roles.
3.) Progress your career
As your employer is now aware you’re actively looking for a new opportunity, they might offer you a promotion. This could make a huge difference in your career for the better.
4.) Increased productivity
Accepting a counteroffer may improve your motivation and productivity as it’s reaffirmed your value, you feel like you are part of something bigger and want to pay back your managers/employer’s decision to offer you the counteroffer.
Source: First State Community Bank
5.) Increased income
More than 1,000 employees and recruiting managers were questioned by LiveCareer HR specialists on what is included in a counteroffer. A 10% raise is provided to about 35% of people surveyed. More than 1 in 4 individuals are allowed to have more work flexibility, almost 1 in 3 are given more annual leave, and around 30% are given a 5 percent raise. Surprisingly, 18.9% of people receive a rise of 20%.
Reasons to decline a counteroffer
There are many arguments or opportunities an employer might use to try to get you to remain on after you resign, but as we can see, it’s not that straightforward. It can be complicated and many factors go into the decision of whether to accept or decline a counteroffer. Let’s look at some reasons why people decline counteroffers:
1.) It is not always about the money
Even if your counteroffer comes with a significantly higher income than the one you are now receiving, this may not fundamentally have a long-term impact on how you feel about the job or the firm in general. There may be a variety of other reasons outside salary including current management, long working hours, lack of flexibility or the culture to name a few. In fact, statistics show that almost 50% of employees who accept counteroffers quit their jobs and look for new ones within a year.
Just 12% of people quit their employment due to compensation; thus, it is very possible that you’re considering leaving your job for another reason. Because of this, you should consider if accepting a counteroffer with greater pay will change your feelings about your work and address the core issue(s) of why you started looking elsewhere in the first place.
2.) It negatively affects the dynamics of your team
The fact that you are considering leaving could suggest a “sinking ship” mentality among your teammates. Generally speaking, your teammates likely have a better understanding of your reasons to leave than your manager. This may have a variety of detrimental repercussions on employee productivity, loyalty, and morale.
Source: The Muse
3.) Career aspirations
When a person’s current role does not align with their career goals or they feel they have stagnated, the new opportunity may be more aligned with you progressing your career.
Given the amount of time we spend at work, we want to make sure our work fulfills our long-term goals, both now and in the future. Spending time and effort on something you do not intend to do for the rest of your life is pointless.
4.) You may not be appreciated at first
If you submit your resignation and your employer makes you a counteroffer, it can make you feel as if your value as an employee wasn’t completely recognised. I think this is a narrow view of the circumstances as we need to appreciate that you were happy to accept the salary on offer when you took the role and generally speaking, your ongoing performance will usually dictate your annual salary increases and bonus (if applicable).
But we do need to acknowledge the perception that if the only way you can get the business to treat you better is by threatening to resign, you may want to question the company’s approach to supporting its people.
5.) Reputational damage
Your new company has confirmed its interest by making you an offer and after careful consideration, you have accepted the counteroffer. Given this outcome, it may impact future prospects of working with that company.
6.) Stepping outside of your comfort zone can lead to great things
Your current job may feel familiar and comfortable to you, but does it really give you the fulfillment and success you strive for?
Sometimes, a move and a new challenge may bring about growth and enjoyment, especially if the new role is more closely related to your goals. Even while no one can foretell the future, at least you will not be left questioning ‘what if’.
Source: CEO Monthly
Closing Thoughts
So, is there a right or wrong answer to this question? No there is not. When considering a counteroffer, it can be a complex and usually very personalised decision. There are likely many layers to it, so I think it’s important to reflect on your values, reasons why you considered departing in the first place, and the future you want. You are ultimately the master of your own destiny and whether you decide to stay or to go, it’s important to feel comfortable in your decision.