When you leave a job, you’ll typically receive a counter offer. This is becoming increasingly common as businesses try harder to retain talent at a time when more people than ever are leaving roles.
Research suggests that as of September 2022, around 40% of workers believed they’d leave their job over the next 6 – 12 months, with most people citing a better work-life balance as the key reason. But should you accept a counter offer if you receive one?
Below we explore what a counter offer is, why they’re becoming more popular and whether you should consider taking it.
What is a counter offer?
A counter offer in recruitment is a package provided by an employer in response to an employee resigning.
Counter offers are usually a bid to keep high-ranking or overperforming employees from leaving and made in response to a worker handing in their notice.
They’re specifically designed to make an employee reconsider their resignation and generally offer some sort of benefits in return for staying.
So why do employers offer counter offers? The short answer is that it’s cheaper in the short-term than replacing the worker wholesale. Other reasons for counter offers include:
• The business wants to retain the employee’s knowledge of the company and operations
• The business wants to avoid adding extra workload to a team during stressful periods
• The business wants to maintain morale or avoid breaking a good company culture
• The business is unsure they’ll find a suitable replacement due to market conditions
Why are counter offers now widely used?
Since the pandemic, the UK recruitment market has seen ebbs and flows, with many employees reluctant to change positions and focusing more on job security.
This has created a highly competitive, candidate-led market and when a good employee does leave, employers are struggling to replace them. This is particularly true of roles that require more technical knowledge or a specialised skill set.
One of the industries most affected by these evolving market conditions is the professional services sector.
Because firms in this sector generally require candidates to have previous experience in the market – alongside technical qualifications – it’s becoming increasingly tough to recruit in a market where top-level candidates are staying put elsewhere.
With this in mind, it’s easy to see why counter offers are being used by firms that want to retain their staff. This change in attitude also means that counter offers are no longer just for senior members of staff. Research suggests that around 50% of candidates that resign from a role will be counter-offered. But should you take a counter offer?
Get help with your job search.
Should you accept a counter offer?
While it can be flattering to receive a counter offer and you may have some loyalty to your current employer, it’s always important to consider whether a counter offer is actually good for you.
Although the final answer to this question entirely depends on you and your circumstances, here’s some questions you should ask yourself and why you may want to decline a counter offer.
Why were you leaving in the first place?
Some of the most common reasons for leaving a job are salary, career progression and challenge. All of these factors may influence your decision to leave and in most cases, a counter offer will only solve one of these issues – usually salary, as it’s the easiest to provide in the short term.
While you may be happy with a pay rise, it’s much tougher to completely restructure for better career progression or add challenge to a role without adding new responsibilities outside of your remit. This means you’ll still face problems going forward.
Will a counter offer really solve your issues?
History suggests accepting a counter-offer rarely solves the problem. According to data from Eclipse, 80% of people that accept a counter end up leaving their current employer within 6 months anyway. 90% end up leaving within 12 months.
This reinforces exactly what we mentioned earlier – while a counter offer may paper over the cracks, there’s often a multitude of factors at play that are impossible to solve in a single swoop.
When you consider a counter offer, you have to think about the long-term picture, not just the short-term gain.
The other thing you have to consider is how your relationships in the business will change following the resignation and subsequent counter offer. While it’s unfortunate, your employers will always know that you were looking to leave and may use the counter offer as a way to temporarily meet your needs whilst preparing for the inevitable departure.
Why are you only receiving these benefits now?
If you’ve been performing well as an employee, hitting targets and overachieving, you’ll probably have spoken to your employers regarding new responsibilities, titles or a higher salary.
If you’ve not had any change in these areas until you handed in your notice, why are you suddenly getting them now? More importantly, will these fix the issues you had in the lead-up to the resignation?
Also remember that if you do receive a promotion as part of a counter offer, you’ll still need to justify why you deserve this better position and will be observed closely by the business – despite the fact you wanted to leave in the first place.
Is your new role ‘real’? How will it affect salary increases in the future?
In some instances, an employer may create a role as a way of appeasing you. Unfortunately, this may not always be the career progression you were after, especially as the employer probably didn’t have time to properly restructure the team in a way to suit this new role.
Always ask what the responsibilities are in your new role and where you fit into the overall hierarchy of the business before you accept a counter offer based around this benefit.
Similarly, ask about how this counter offer will impact future salary reviews. Some companies may use the pay rise in your counter offer as a way of avoiding increasing your pay during your annual pay review.
Would you regret not moving on?
Ultimately, a large part of accepting or declining a counter offer depends on ‘what if’. If you feel like you might regret taking the leap and moving to a new business or trying a new challenge, these feelings may turn into resentment towards your current employer.
Remember the statistic about people moving on post-counter offer. Regret is often just another factor that adds to a growing list of issues and all you’ll have to show for it is a lost opportunity and a return to the job search process
How to handle a counter offer
Regardless of which way you’re leaning in terms of accepting or declining a counter offer, here are some tips for dealing with the issue:
Speak to your manager immediately: If possible, talk with your line manager and determine why they want to keep you. Is it because you’re valued or are they simply looking to avoid replacing you?
Ask about the terms of the counter offer so that you’re totally aware of what it means and what that looks like for you. Finally, take some time to process and consider the offer. There’s no need to rush into anything.
Compare your counter offer with your new job: When you take the time to consider the counter offer, compare it to every other aspect of your new job. What is the culture like at the new place? Which company is more likely to help you progress? Does the new company offer better training or learning opportunities? Which company best aligns with your values? Don’t just blindly look at short-term benefits such as salary or bonuses. Think about what works in the long-term.
Speak to your recruitment consultant: If you’re working with a recruitment agency, let them know about the counter-offer as soon as you receive it.
They’ll have seen this situation hundreds of times and can provide a professional opinion on what you need to consider and what to do.
It’s always in their best interest to ensure you make the right call as they’ll want to maintain a good relationship with both you and the client you applied for.
Revisit your reasons for leaving the job: While money is a motivating factor for getting a job, it’s not usually the main reason a person leaves.
Most people leave a position because they don’t click with the team or a manager, because they want more responsibility and challenge or they’re seeking a better work-life balance.
Think about what issues you had with the original role, why it didn’t align with you in the first place and whether the counter offer will fix that entirely.