Q&A talks with Tom Borghesi, Northeast district president for Robert Half Technology, about the tricky art of the counteroffer.
Q: You›re of the opinion that counteroffers should never be accepted once an employee hands in a letter of resignation. Why is that?
A: It is almost never a good idea to accept a counteroffer. Counteroffers may appear flattering on the surface, but the drawbacks are significant. Remember why you looked for a new job in the first place. A salary bump won’t fix problems such as a poor work environment or a lack of growth potential. Professionals should ask themselves why it took their leaving for their manager to step up and make a better offer. Did the employer just now realize how valuable they are? More likely, the manager is in self-preservation mode and more concerned about the short-term disruption of the departure.
Q: What can an employer do to keep a talented employee? What›s the counter to the counter offer so to speak?
A: Retaining qualified employees is critical. A recent study by Robert Half Technology and HDI found that compensation and limited opportunities to grow or advance are the primary reason employees leave. To improve the likelihood of retaining top talent, organizations should institute training and development programs in addition to offering valuable perks such as paid time off and supporting the elements of a successful work culture, like work/life balance.
Q: Let’s look at this from another perspective. How should the prospective employer handle a potential hire who accepts a counteroffer from his or her current employer? Does the potential employer counter with yet another offer?
A: Offering a counteroffer to a counteroffer is not a good idea, even if the company is short staffed. The candidate who accepts the initial counteroffer is backing out on a job agreement, which not only puts the hiring manager in the awkward position of scrambling to find a replacement but also points out a lack of trust and dependence.
Q: By the way, is all this moot? In this difficult economy, why should employers even entertain a counteroffer? Can’t money savings be affected by hiring less expensive workers?
A: In this environment where some companies are short staffed, they may be even more willing to extend counteroffers so they can keep their best people. It’s easy to fall into the trap of making a counteroffer based on emotions. No one wants to lose a key staff member, but it’s essential to take the time to seriously consider the situation. Losing valued staff can have a silver lining. Often, it provides a good opportunity to reassess workforce allocation and make adjustments. For instance, a manager may realize instead of filling the position being vacated, they’d rather hire someone in another role.
Q: Some research claims that 70 to 80 percent of people who accept a counteroffer leave the job within a year, sometimes by being pushed out. Has that been your experience? Do people who take counteroffers end up being undesirable employees in the long term?
A: People who are completely satisfied in their jobs won’t even consider the possibility of quitting. Those that are willing to move on have the necessary motivation, such as escaping interpersonal conflicts or receiving a pay raise. Even if the employer goes to great lengths to improve the issues, they may just be applying a Band-Aid to a larger problem. Someone who is leaving for a promotion, for example, may be happy moving up in the company — but still resent the fact that colleagues advanced before them. They may remain unhappy staying at the company and ultimately quit again.
Q: By the way, what are some steps employers can take not to have to get to this whole counteroffer stage? What are some good ideas on employee retention?
A: Re-recruit your employees by talking to them about what might enhance their job satisfaction. Emphasis what your firm has to offer, whether it’s a great corporate culture, solid financial standing or a strong industry reputation. Compensation plays a large role in employee satisfaction, so employers will want to ensure salary is competitive. Companies should address burnout proactively by promoting realistic workloads, bringing in project professionals when full-time employees are at capacity, and tackling morale issues immediately to help prevent employees from feeling stressed and unhappy. Companies may also want to develop programs that support career growth and work life balance. The ultimate goal for employers is to create the type of work environment that will persuade their best professionals to stay regardless of economic conditions.
