The official blog of Abacus Group — a place to share our knowledge and thoughts on trends in recruiting

April 13, 2012

The Counteroffer: Why and How to Avoid This Losing Proposition

counteroffer-losing-proposition

When an employee announces their resignation, they are sometimes confronted by what is known as a counteroffer—their employer’s “rebuttal” in the form of a proposed salary increase, promotion, or other benefits. Many misinformed professionals won’t hesitate to consider counteroffers. In fact, many will reason that salary increases resolve difficulties or concerns they have in their current roles. While a counteroffer may seem like a tempting, even flattering, quick fix for many employees, it’s best avoided to protect long-term career interests.

If you are among those professionals who, following the announcement of your resignation, would consider a counteroffer, you may want to reconsider your decision. The list below details the most important reasons why, once you have stated your decision to leave your current organization for a new opportunity, you should not back down, even if tempted by higher pay:

You’ve Wasted Your Time

You have already applied considerable effort in obtaining a better opportunity, motivated by some particular dissatisfaction with your current role. Why give that up? By accepting a counteroffer, the only “benefit” you’ll enjoy after all that effort is a higher salary (or title increase or additional perks). Meanwhile, you’ll remain unhappy with your manager, colleagues, responsibilities, the organization itself, or whatever it is that initially triggered your decision to leave. Plus, any future raises or promotions will probably be diminished or dismissed.

Professional Relationships Will Suffer

You will significantly tarnish your relationship with your supervisors and managers. Management may feel as though you pressured them into offering a higher salary, especially if your continued employment with the firm was important to them for the accomplishment of certain key objectives. As a result of these strained connections, you’ll be placed at a disadvantage in terms of receiving recommendations or referrals in the future.

Poor Implications for Promotions

The acceptance of a counteroffer implies that you are willing to take on additional responsibilities that you may be unprepared to handle. Unlike an organic promotion, your salary boost won’t be prompted by a display of outstanding performance or someone else’s resignation. Furthermore, you most likely won’t be considered by management for other promotions if the only way that you are able to obtain one is to admit that you have been offered a job at a higher salary.

You Won’t Be There Much Longer

Statistics show that employees who accept counter offers won’t remain in their current positions for more than one year.  In fact, according to US News, between 70 and 80 percent of those who take a counteroffer will leave the organization within nine months. In this case, you’ll need to begin your job search all over again.

Keeping in mind the rationale for counteroffer rejection, learn to avoid the proposition in the first place. Before you even approach management to let them know that you are going to resign, you have to be absolutely grounded in your decision to take the offer at the new firm. Any doubts will leave you vulnerable to the temptation of a counteroffer, so be sure to constantly remind yourself of why your decision to leave is the best path for your career. To solidify your decision about leaving your current position, put it in writing for management in the form of a resignation letter. The letter should include your intended last day with the firm, as well as a statement of the fact that your decision is final. Finally, you must reiterate the definitiveness of your resignation in person. If the inevitable counteroffer is made, you can politely decline while stressing that the opportunity—not the salary—offered by the new position is best for your career. 

Clearly, the resignation process will sometimes be difficult for professionals given the frequent use of the counteroffer tactic by employers. The bottom line is that accepting this type of proposition will only amplify your original job dissatisfaction and lead to your eventual resignation or termination.

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