Counteroffers: Just Say No!

March 1, 2010 at 6:54 am 31 comments

I recently posted a blog called “The Proper Way to Quit a Job.” Towards the end of that article, I mentioned that the most typical response by any boss who doesn’t want to lose an employee who is quitting is to come up with a counteroffer (more money, a promotion, more responsibility, a modified reporting structure, etc.) Most recruiters are trained to discuss this issue with their candidates from the very first conversation … and keep bringing it up over and over. That’s because one of the most common reasons for placements falling apart at the last minute is a candidate foolishly accepting a counteroffer. I say “foolishly” because it is considered Career Suicide by almost all Staffing Professionals. Why is that? The following information was published in the Wall Street Journal:

Fact: 80% of all people who accept a counteroffer leave their company or are terminated within six months. (Source: National Employment Association)
Fact: 90% of all people who accept a counteroffer will re-start their job search within six months. (Source: Business Week)
Fact: Decent and well-managed companies don’t make counteroffers … EVER! Their policies are fair and equitable. They will never be subjected to counteroffer coercion, which they perceive as blackmail.

And needless to say, you will have burned a pretty major bridge to the company whose offer you turned down by accepting the counteroffer. Once you’ve “left someone at the alter,” you can almost never go back. That other opportunity will be gone forever. Word gets around – and when you do inevitably end up back on the job market, that burnt bridge might come back to bite you. [Read “The Golden Rule for Business: Don’t Burn Bridges” for more on why this issue is so critical.]

So why do some companies make counteroffers? Think about it. When someone quits, it’s a direct reflection on the boss. Employers don’t like to be “fired.” In most cases, the boss will look bad for allowing you to go. It’s an implied insult to their management skills. Bosses are judged in part, by their ability to retain staff. They probably don’t have a contingency plan for your departure. Your leaving may jeopardize an important project, increase workload for others or even foul up vacation schedules. It’s never a good time for someone to quit. It may prove time consuming and costly to replace you. In the short term, it’s much cheaper to keep you – even at a higher salary. So their gut reaction is to do whatever has to be done to keep you from leaving … until they are ready to fire you on THEIR timetable! That’s human nature.

The following list is not new – it’s been published in many different forms, has appeared in numerous magazines and newspapers, and has been floating around the internet for many years. Still, it’s absolutely on target … and each of these points is totally true. They all add up to one inescapable conclusion: Just Say No to Counteroffers!!!

The TOP 10 Reasons Why NOT to Accept a Counteroffer:

Reason No. 10: Once the word gets out, the relationship that you now enjoy with your co-workers will never be the same. You will lose the personal satisfaction of peer group acceptance.
Reason No. 9: Accepting a counteroffer is a bribe – an insult to your intelligence and a blow to your personal pride. You will always know that you were bought.
Reason No. 8: Statistics compiled by the National Employment Association confirm the fact that over 80% of people who accept a counteroffer are no longer with their company six months later.
Reason No. 7: The same circumstances that made you consider a change in the first place will repeat themselves in the future, even if you accept a counteroffer.
Reason No. 6: When times get tough, your employer will begin the cutbacks with you. Your position will be much less secure going forward.
Reason No. 5: When promotion time comes around, your employer will remember who was loyal and who wasn’t. Which list do you think you will be on?
Reason No. 4: You have now made your employer aware that you are unhappy. From this day on, your loyalty will always be in question.
Reason No. 3: Your company will immediately start looking for a new person at a lower salary.
Reason No. 2: Where is the money for the counteroffer coming from? Is it your next raise, early? If you were worth “X” yesterday, why are they suddenly willing to pay you “X + Y” today?
Reason No. 1: What type of company do you work for if you have to threaten to resign before they give you what you are worth?!

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Entry filed under: Advice for Job Seekers. Tags: , .

The Proper Way to Quit a Job Face-to-Face Interviews: Secrets, Tricks and Tips

31 Comments Add your own

  • 1. Robin Bectel  |  March 1, 2010 at 3:16 pm

    Good point. The lesson internally is don’t make counter offers. I was forced to make a counter offer once to someone I thought highly but didn’t think she was yet worth the salary she had been offered elsewhere. She accepted the counter offer, everyone else at her level heard about it and demanded higher salaries to0 – and she left 3 months later. Not worth it at all. We should have just let her go gracefully.

    Reply
  • 2. Terry Schultz  |  March 1, 2010 at 6:00 pm

    I liked it. I especially liked #9 and #7. Thanks Michael. Very good points made.

    Reply
  • 3. John Hadley  |  March 1, 2010 at 6:02 pm

    I agree that in the vast majority of cases, making or accepting a counter offer is not a good idea. However, as with anything, one must carefully weigh their own specific situation in making the decision – and it is a good idea to talk it through with a disinterested party who can help you see it from all angles.

    I once had an employee who came to me to turn in her resignation, and was clearly very unhappy about it. I sat down and talked with her for an hour about what was really going on, and she knew that had I believed the move was the best for her, I would have been the first to congratulate her enthusiastically. When we got to the underlying issues, I found I was able to solve them, and she continued to work for me happily for several more years (until our company went through a merger).

    A client of mine went in to his CEO (with whom he had a very good relationship) to turn in his resignation, with a very nice offer from another company that would move him into the sort of position he wanted. He had not anticipated that he could get that type of position at his company, so he hadn’t even pursued it. The CEO sat him down, heard him out, countered the offer and created the role my client really wanted, even adjusting the organizational reporting structure to accommodate him. My client was very happy with the result, and continued to thrive at his company.
    John
    ____________________________________________
    John West Hadley
    Career Search Counselor

    Reply
    • 4. Victor  |  July 29, 2014 at 2:24 pm

      John.
      This is more interesting comment than the article itself. The reasons for making decisions like resigning, making a counteroffer and accepting or rejecting a counteroffer are personal in nature.
      If you understand your deep motivations for those decisions and understand your company, you should be able to make and informed decision.
      Looking from a macro perspective at statistics (80 / 20%) could influence your decision making and you may loose the opportunity to come with a better career path for yourself.
      That being said, the key is to make an informed decision taking into account all factors involved in this decision.

      Reply
      • 5. Michael Spiro  |  July 29, 2014 at 3:22 pm

        I would only add that in both of the examples that John sited, the employees seemingly did not voice their concerns or discuss their career desires, objectives and goals with their bosses in advance of resigning. One should not have to wait until they are giving notice to have those important conversations!

  • 6. Angela  |  March 1, 2010 at 6:44 pm

    Thanks, Michael. This was interesting.

    Reply
  • 7. Alberto Malerba  |  March 1, 2010 at 7:23 pm

    I must admit it’s purely the truth, at least in my experience. Interesting to read that it has a high statistical value.
    I must admit that most points are valid, but your statements on loyalty are the key ones. I doubt there are many employers who will not take a resignation letter as a lack of loyalty.
    Alberto

    Reply
  • 8. Marian Herz  |  March 1, 2010 at 7:35 pm

    I fully agree. Luckily I had an excellent recruiter who pretty much predicted (almost verbatim) what my manager would say when I told him I was leaving. Because I was prepared, I was able to easily turn him down (and he wasn’t able to come close to the offer I had anyway).

    Reply
  • 9. Zoltan Puskas  |  March 2, 2010 at 11:21 am

    Michael, good advice. A boss once asked if I would consider a counteroffer, and my response was: “Why am I now worth more now than yesterday?” I took the position with another company.

    Reply
  • 10. Michael Smith  |  March 2, 2010 at 3:07 pm

    Michael, I completely agree! “Just Say NO”

    I’ve witnessed it countless times through-out my career as friends and co-workers have been enticed to accept the counter-offer only to find themselves “handcuffed” to the very job they were trying to “escape” – moreover the executive recruiting community is a fairly small and tight-knit group and word travels fast amongst them. They are reluctant (in the current glut of candidates) to work with someone who breaks their commitment to accept the new position.

    Reply
  • 11. Larry S  |  March 3, 2010 at 9:21 am

    I agree. A counteroffer should never be accepted. It makes you look like a mercenary, and it is an insult to senior management because it makes them feel like you pushed them around. They never forget about it, never give you any more opportunities, and often find a way to eventually boot you out.

    Reply
  • 12. Dirk Gerber  |  March 5, 2010 at 3:41 am

    That’s a nice article Michael.
    Thank you.

    Dirk

    Reply
  • 13. Terry Schultz  |  March 5, 2010 at 10:33 am

    By the time a counteroffer is a possibility, the person has most likely received an offer. Also, the person has already decided, for whatever reasons, that it is time to leave. The mind set is already there. And, the person probably is leaving because the line manager didn’t care about their contributions and skills and has allowed that person to stagnate in the position.

    I think once a person has decided to leave, if a counteroffer is made, they should not accept because of that mind set that has happened. I don’t believe it would be good for either party short term.

    Just a thought.

    Reply
  • 14. Darrin Grella  |  March 5, 2010 at 11:57 am

    Thank you Michael for the post. Obviously your point is pretty clear that counter offers are simply unacceptable, no matter the reason.

    One thing I have witnessed over the past 15 years is that if a person is with a company less than 2 years the counter offer tends to be money, when someone is with their company more than 2 years the counter offer is loaded with more emotional power. The title, the perks, the promotion, the corner office. Things that stroke the ego more. On my blog I have been following a gentleman that unfortunately accepted a counter offer. It has almost been one year now and he is miserable. Probably a time for an update on his story. http://www.theinterviewgurus.com/theblog

    Thanks again for your post!

    Reply
  • 15. Claudio Brandt  |  March 8, 2010 at 7:18 pm

    Hey Michael, what an excellent post—and an excellent blog as well. Having had professional experience abroad before I moved to the U.S. in 2000, I’ve witnessed many cases where what you say is not corroborated by experience. I’ve seen many people leverage their careers by negotiating a new job only to accept a counter offer of either more money or promotion, many times both—all while being respected and valued for being perceived by the “market” as a hot employee. This may be though something specific to my field (editorial/broadcast/publishing). For me it was illuminating to see an insider’s view with a totally different approach than what I’d expect.

    Reply
  • 16. Jeff Williams  |  March 8, 2010 at 10:21 pm

    Agreed! It is usually the fact that the reason(s) and circumstances that caused someone to start looking for a new position still exist after a counteroffer is accepted. Unless the counter offer completely resolves long term issues and positions the person to continue and flourish in their career it is wise to just keep moving on.

    Reply
  • 17. Shana Ellis  |  March 12, 2010 at 7:58 am

    I worked for a recruitment agency who always advised candidates not to accept counteroffers for exactly the same reasons given by Michael Spiro. When I handed in my notice after working for them for a period of time I was offered a counteroffer. Bizarrely they were shocked when I declined the offer.

    Reply
  • 18. Kathryn Buer  |  March 13, 2010 at 4:36 am

    Maybe I can weigh in from another side. In past positions I have had people quit and in a few cases decided to “counteroffer”. You can rest assured that THE COMPANY had a very good reason for doing so. It generally has nothing to do with what’s best for the employee. It has to do with the immediate circumstances FROM THE COMPANY PERSPECTIVE.

    Some times it has worked for a short period but generally it is just a band-aid. The employee has 1) proven to him/her self that they can move on and 2) convinced themselves that it is time to do so. Once those mental hurdles are crossed, the path is set and I find that they eventually do.

    It definitely influences how the company/manager feels about the employee. It is impossible for it not to affect the relationship if for no other reason than that no one likes to be pushed into a corner. So don’t expect the company to feel a lot of loyalty to you once you’ve done it and know that you have no future bargaining power.

    Bottom line, from a job-seeker point of view I would have to agree with Michael. If the issue could have been sorted out it should have been before you went to the leaving point. Once you’ve crossed that line – keep going!

    Lastly, in search mode you need to play all the cards you can and recruiters – love ’em or hate ’em – are one of the tools for finding a new role.

    NOTE: I am not a recruiter nor have I ever been but more than half my roles have come to me via recruiters.

    Reply
  • 19. Fred V  |  September 27, 2010 at 10:50 pm

    Unrelated question: What if you are forced to leave a company on bad terms. For example, they close their city office, where you worked for about 10 years–and working in the city was a term of your employment–and expect you to relocate about 50 miles away, into the wilds of the suburbs, a distance you’d have to drive, which you can’t because one) with traffic, it takes anywhere from 2-3 hours each way; two) because you have a painful back condition and three) it wasn’t the agreement. They won’t let you work from home even part of the week. You even have a doctor’s note. But they won’t budge and you are forced to resign. They fight your attempt to collect unemployment, but you win and collect anyway (you are in the right, obviously). Is there any way to mitigate any harm the company may do when future potential employers call them?

    Reply
    • 20. Michael Spiro  |  September 28, 2010 at 5:44 pm

      Fred:

      Wow … that’s quite a story and question! In your particular circumstance, I would think there’s not much you can “do” at this point to improve your standing with your former company. I think what you are asking about is regarding what they might say about you during a reference check. If you are forced to provide a reference from that particular company – I would suggest using someone who is sympathetic to what happened to you there (if such a person exists.) I also think it might be wise to be proactive and tell your potential future employer what happened there (but in a less detailed and inflammatory manner than your comment here) before they check your references.

      Michael

      Reply
  • 21. Gel Pen :  |  October 30, 2010 at 4:11 pm

    just be careful with some recruitment agencies because some of them are scammers too ~

    Reply
    • 22. Michael Spiro  |  October 31, 2010 at 1:22 pm

      I’m not sure who you think is “scamming” you. Employers who try to offer counteroffers are not “scammers” – they are simply acting in their own best interests rather than their employee’s. And yes, some (but certainly not all) recruiters are less reputable than others. However, that has nothing to do with the general advice to not accept counteroffers.

      Reply
  • 23. Anonymous  |  January 5, 2012 at 2:22 am

    Great post, useful and uncomplicated to comprehend. I will take advantage of your advice!

    Reply
  • 24. Sof  |  July 30, 2014 at 10:41 am

    Thanks for this advice. I had no idea this was such common practice- it’s insane! And I see this coming!- it’s been implied a couple of times by my employer who knows I’m looking to leave. And it happened just yesterday to my colleague- she stayed! I think it’s their assumption that this will all fall into place and I’ll stay. I’m actually really offended by that thought, so I keep a note on my phone to remind myself…I would rather be committed to a company who sees the value in me as a relative stranger and is willing to invest, rather than a company that knows me well but needs to see another company want to invest in me first.

    Reply
  • 25. Matthew  |  July 30, 2014 at 12:51 pm

    If there are many layers of administration, and you are being pushed out to leave because of horrible bullying and harassment, without being bitter, shouldn’t one at least be honest and say the reason why one is leaving, that is, without ranting or giving details, just “due to X and Y.”? I don’t want to seem naïve, but maybe you want to let people know what’s going on before leaving…

    Reply
    • 26. Michael Spiro  |  July 30, 2014 at 1:29 pm

      Matthew:
      Forgive me if I’m the one who sounds naïve now … but bullying and harassment sound like serious issues that should have been brought up to your company’s management long before deciding to quit. If they were, then there would be no need to re-hash the topic when giving notice. If not, well — it’s your call if you want to stir up the pot during your own exit. Yes, it’s good to “expose” such wrong-doing. However, you do run the risk of burning your bridges on your way out.
      -Michael

      Reply
  • 27. Michael  |  July 31, 2014 at 11:33 am

    Thanks for the post! It explains some of my bosses attitude toward me for the past year. Yes I probably will be part of the statistics you cite, and thanks for the letter and how to answer my bosses questions in your other post. The 10 reasons crystallize my decision this time.

    Reply
  • 28. Anna  |  August 1, 2014 at 11:23 pm

    Good articles. I have a little unique spin to this though…I was involved in a social services part-time job. I had been there for just over two years. I didn’t need the job, but did it because I enjoy helping others and making a difference. I simply have too much on my plate and a busy life style now. I gave two weeks notice a couple months back and it was denied. They know I’m talented and skilled in that area and have good relations with clients, families, and coworkers. I wasn’t moving on to another company, just looking out for my own interests and time. I was offered a raise, and to pay for a portion of car washes due to having to drive on gravel for my job. The family begged me to stay, my coworkers did, and so did my boss. I hated to leave and felt guilty for my decission to quit, and it felt nice being valued and appreciated. Yet, I’ve still felt guilty and time crunched for staying and not sticking to my guns and quitting originally.
    Now, I’ve turned in permenent two week notice again as my full-time work will be starting back up and I simply don’t have time for everything. I haven’t felt management treat me different, or under valued with what I was doing before. I felt honored they were willing to fight to keep me. However, I also feel stressed and guilty for not looking out for myself. Just a different perspective on this concept, but I’m now part of the statistis quoted. I wish I’d found this article a few months sooner. I’m not burning bridges, and I think they are understanding, yet struggling to find a replacement.

    Reply
  • 29. eduardo  |  August 3, 2014 at 8:22 am

    Hi Michael, great articles!
    After several years working in project management and continuous improvement in a manufacturing company, I just started last week working as a product manager in a oil & gas company. It was a conscious movement into an unknown field to me, as I want to get more exposure to the commercial side of business.

    During the job hunting I was lucky to get a few proposals, some of them even after I had signed a contract with my current new employer. But last week I got a very tempting proposal, to establish a project management department in a huge pharma production site, with a higher salary and very challenging position reporting directly to the local CEO, which all sounds great but it seems to me quite a risky move as it will be very very demanding, and also will need to move from the city to the country side (which is 4 hours away). Also I will not mind getting 2-4 more years of management experience before such a role, but the opportunity is there NOW!

    So I’m considering different scenarios:
    A- to stay in my current new job, learn a lot for a few years before moving into a higher management position
    B- in case of a counteroffer from the oil company to accept it
    C- to explain the situation to my new boss, and see if there is any chance to freeze the position for a few months (I know it sounds like to much asking…), as in the pharma I will have a probation period of 1 months and a 2nd probation period of 6 months
    D- “jump in deep waters” and follow Richard Branson saying— ‘If somebody offers you an amazing opportunity but you are not sure you can do it, say yes – then learn how to do it later!’

    any recommendations or ideas?
    A, B C or D with a short explanation why

    Reply
    • 30. Michael Spiro  |  August 5, 2014 at 1:27 pm

      Edwardo: You’ve done a nice job of laying out the pros and cons of each choice you have. I can’t really advise you on which one will work out best for you. It’s up to you to figure out how much risk you are willing to assume. I will say that it’s nice to have choices, though, isn’t it?!
      -Michael

      Reply
  • 31. Kyle  |  March 10, 2016 at 11:04 am

    So their gut reaction is to do whatever has to be done to keep you from leaving … until they are ready to fire you on THEIR timetable! That’s human nature.

    This is the truth, over the next 6 months bosses will readjust responsibilities and priorities and all of the sudden “efficiencies” will be found.

    Reply

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Michael Spiro

About the Author:

Michael Spiro has been a 3rd-Party Recruiter and Account Executive for over 15 years. He is currently the Director of Recruiting / NE Ohio Region for Experis Finance, a dedicated business unit of ManpowerGroup. Other recent positions include President of Midas Recruiting, a boutique head-hunting firm, Director of Talent at Patina Solutions, and Executive Recruiting positions with two of the largest search firms in North America. Before his career in the staffing industry, Michael was a manager in a large non-profit social-services organization. And in a former life, Michael was active in the entertainment industry, with extensive road-warrior experience as a touring performer (singer-songwriter / guitarist / comedian) and as a recording artist, producer and booking agent.  [More...]

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