Summary: You just accepted the offer for a new job and your bags are packed, ready to go. However, your first employer counter-offers. Here are the pitfalls of your first employer’s counter offer – and the potential dangers should you choose to stay.

The Pitfalls of Accepting Your Employer’s Counter Offer

Your job search was successful!

You have an offer and are ready for the long-awaited day of handing in your resignation.  

Offer in hand, you confidently stride into your boss’ office, expecting to part ways.

Then your boss does the unexpected.

He offers you a better offer. (Be it more money, a bigger title, or more benefits). Usually all of the above. So long as you stay.

Now you’re in a tough spot.

 

Should You Stay or Should You Go?

You have two offers on the table.

Do you take the first offer and move on to a (potentially risky) new job?

Or do you go back to your desk? (With a higher paycheck and a feeling mixed of triumph and resignation. Triumph because your employer finally sees your true worth. And resignation because you had your bags packed, but something is now holding you back).

Before making a decision, it helps to understand your employer’s motivation.

Understanding Your Employer’s Motivation: Why Your Employer May Counter-Offer

Above all, your current employer does not want to lose you. He or she may realize the value you bring, and so will offer additional incentives to stay. Additional benefits, flexible hours, and additional pay are all a part of this incentive package. You may even be surprised by how much they are willing to do to keep you.

But ask yourself: “Is this effort on their part genuine?” “Do they really appreciate me now – or is this an enticement to keep me around longer until they (eventually) find someone better?”

Understand that to keep an existing employee is more cost-efficient and easier to train than someone new. On the surface it may feel fine, as you are ushered back to your desk with a polite smile. But realize that internally, he or she is scrambling.

Behind closed doors, the first call you manager may very well make is to a recruiter or outsourced HR firm – in order to find your replacement. You’ve been identified as a flight risk – and your passport may soon expire. Your manager’s task is to keep operations running as smoothly as possible. Regardless of whether he or she can keep you there, they will most likely be looking for a new candidate that day.

“Counter offers have become more prevalent given the low unemployment rate and the scarcity of talent. Usually, there is something more than just compensation that is driving your decision to leave. Perhaps it is your relationship with your boss or your colleagues, opportunities for advancement or you just need a change. It is important to know the true facts around what was communicated to you in the counter offer. Money is easy to see immediately but some of the other issues you may be having with your employer may not change as rapidly. If you trust what is being communicated and you see things changing for you then maybe it will work out and you will remain with your current employer. If you are not going to be engaged and enthusiastic then it does not make sense to stay.” – Tammy Klein

 

The Dangers of Staying When Loyalty is Broken

“The home-company has reason to doubt the loyalty of the employee, which will be reflected in future advancement decisions. Long-term advancement for the employee diminishes because trust has been broken.” – Marcia LaReau, Ph.D., Career Intelligence [#1]

Additionally, accepting a counteroffer can potentially burn two bridges. The first is with your new employer, who may not consider hiring you again. The second is with your old employer, whom you have lost massive loyalty points with as a result of your actions.

Should You Decide to Stay

Should you decide to stay there are a few benefits you could expect to reap.

On the positive side, you will be paid fair market value for your services. If compensation is your primary complaint then it will work in your favor if you stay. (Provided of course, that you can guarantee that you’ll remain).

However if the problems are deeper (lack of challenge, toxic work environment, or burnout) then an additional $10,000 a year will likely do little to solve your happiness.

After the initial honeymoon “let’s work to make things better” period, you may find yourself in the old rut. The underlying problems that caused you to look for a job in the first place most likely will not change. However, we do recognize that in some extreme cases flexing your muscle by looking at a competing job is the only way to get employers to start paying more attention to you.

 

Should You Decide to Leave

Should you decide to leave, you will be acting in accordance with your original agenda. Your new employer will be glad to have you. You will be able to start fresh and grow into a new, hopefully more positive role.

 

What Your Offer Letter of Employment Creates

-It signals to your boss that you have been flirting with the idea of jumping ship

-It may split the relationship between you and your boss

-It puts the management team on high-alert

-It puts your solidarity at risk. Management, HR, and IT will need to take measures to limit your access to information and communication. In jobs with access to sensitive information, (like finance), measures must be taken to mitigate the damage a rogue employee can cause. Don’t be surprised if you are un-invited to meetings, left out of community water-cooler-talk, and have your account access privileges suspended. Your boss is only doing his or her job of protecting the assets of the company.

-You show that you are not committed to the company

The Dangers of Half-Hearted Measures

As Human Resources professionals we’ve seen too many unhappy employees make career blunders. Being half-hearted in your measures can lead to a “one-foot-in, one-foot-out” scenario. This scenario plays itself out when employees are too timid to move forward. They are not able to land both feet in either role.

 

Final Words of Advice

Make certain that you have discussed the issue with family and friends, weighed the pros and cons, and are fully prepared to leave your current employer.

Expect the counter-offer. Your boss’ immediate reaction will be to meet you halfway in salary, or even give you a better offer than the one you presented. However, this counter-offer is a tactic on the part of your current employer to keep you happy in the short term.

“Ask yourself: “Why is my manager offering me a raise now that I’m resigning?” Most likely, it is not because you’ve suddenly become a more valuable employee. It’s because your manager doesn’t want to deal with the work disruption your departure could create.”  -Lisa Quast, Forbes writer [#2]

Receiving a counter offer is tempting, but our experience shows in most cases you’re better off sticking with your decision to leave.

Once it’s “Go time, it’s GO time.”

And be warned! Using an external offer-of-employment as leverage to get a higher raise with one’s current employer is a strategy that backfires more often than it succeeds.

For more career tips, visit the Klein HR Solutions blog. Wishing you the best on your career path! 

Founder and Owner Tammy Klein at her launch event in 2018
Founder and Owner Tammy Klein at her launch event in 2018

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