The Pitfalls Of The Counter Offer – And How To Respond

Business Insights

Grant Nisbet, Operations Manager for Jonathan Lee Recruitment, discusses the potential pitfalls of the counter offer for employers, and what employees should do if they are the one being counter offered.

In this candidate-led market, when a valued employee intends to move on, it's no surprise that many employers consider making a counter offer in order to retain their services.

But how do you decide whether making a counter offer is the right thing to do?

Understand the why

Firstly, it is important to understand the employee's motivations for looking for alternative roles.

A recent snapshot of the information provided by engineering professionals to Jonathan Lee Recruitment showed that there are a variety of factors that influence the decision to move on. Salary is rarely the sole driver. Employees can be enticed away by job content and more challenging work, benefits, greater recognition of skills, abilities and contribution, better personal and career development opportunities, dissatisfaction with a manager or the business culture.

Unless you understand the key drivers for the employee, it’s impossible to know whether a counter offer will truly address the underlying reasons for the move.

Avoid empty promises

Experience shows that more than 80% of people who accept a counter offer still leave the business within 12 months of their initial resignation.

The explanation for this is simple. Most people are anxious about change and therefore when a current employer offers more money and tells them that they are really wanted or that the things that frustrate them will change, they are often tempted to stay with the familiar.

However, if the employer can then not deliver on the promises made, or addressing the issues was not reasonable or achievable in the first place, it may well be best to part ways sooner rather than later.

Get ahead of the game

However flattering, a counter offer is often regarded by the outgoing employee as a belated recognition of their value and contribution in response to the threat of losing their skills. This can often leave a sour taste. Why does it take a third party to recognise their worth before you do? Make sure that any counter offer is perceived positively and will not cause future problems.

You also need to consider the effects on other employees; if they see a colleague receiving a promotion, pay rise or increased benefits as a direct result of handing in their notice, might they follow suit?

In a sector as competitive as engineering, if you have great people that you want to keep, make sure you have a plan! Regular communication, succession planning, career development plans and new reward schemes are all ways in which a supportive employer can ensure staff feel motivated, understand their motivations and ambitions and keep them engaged for the long term. Action is always more positive than reaction...

What if it’s me being counter offered?

How do you decide what to do? Here are some questions to stop and ask yourself:

  • Will the situation here really improve just because I said I was leaving?
  • If I stay, will my loyalty be suspect and affect my chance for advancement?
  • The pay rise makes me very expensive for the job I am now in. How will that affect any future rises or external prospects?
  • I received this counter offer because I resigned, will I have to do that the next time I think I am ready for a pay rise or promotion?

To find out more, please speak to Grant Nisbet:

About Jonathan Lee Recruitment

Jonathan Lee Recruitment has been supplying the engineering and manufacturing sectors with exceptional people for 40 years.

As many of our consultants come from engineering backgrounds, including the automotive, aerospace, defence, manufacturing and electronics sectors, we pride ourselves on our in-depth understanding of the skills, experience and personal attributes required for specialist roles.

We are committed to fostering a culture of continuous improvement so we can bring you the personalised attention and quality service needed to become your most trusted recruitment resource.

Jonathan Lee is ISO 9001:2015 accredited and a full business member of the REC. We operate across the entire UK with offices in the West Midlands, Warwickshire