The recent shortages of suitably qualified candidates on the market have increased the pressure on employers to ensure the company retains its existing qualified employees. As a result, counter offers have become an increasingly popular strategy in order to dissuade staff of accepting a new job elsewhere.
Counter offers can be confusing, but when considering whether or not to accept a counter offer it’s important to understand what a counter offer is and how this decision could impact your career further down the road.
When confronted with this situation, you will need to take a step back and ask yourself whether this new offer will truly address your original reasons for leaving. Furthermore, it is possible that your future within the company could be impacted even if you were to decide to stay.
"Our research has shown that 39% of professionals who accepted a counter offer during their resignation process returned to the job market within a year," said Els Van Der Veken, Senior Manager at Walters People. "This suggests that many employees who have considered leaving a company are not persuaded to stay on the long term.”
Reasons to keep you – the ‘buy back’
It is in an organisation’s best interest to retain their best employees whenever possible, so managers will often try to financially incentivise their employees to stay.
The fear of change can influence your decision to stay. Moving to a new employer where you have to prove yourself all over again can seem daunting, but while a rise in pay and increased career progression can be appealing, you should consider a couple of factors before deciding to accept a counter offer:
1. Has the trust in your relationship been damaged?
While counter offers are a popular strategy among employers to retain staff, 39% of professionals who accepted returned to the job market immediately within a year.
Your new post-resignation life is not going to be easy, it is possible that your loyalty will always be in question.
"Once having expressed your desire to leave and having looked for another job, your employer may see you as a less trustworthy employee and could view any dental or doctors appointments suspiciously, which might cause a little uneasiness for you at work."
2. Is the counter offer in your best interests or your employer’s?
Retaining staff, even if it means increasing their salary or bonus, is usually cheaper than hiring and training a new employee. These factors may be what drives your employer to make the decision to encourage you to stay.
"While it is clearly in your employer's interest to retain you, this doesn’t change the fact that you have been unhappy enough at work to not only look for another opportunity, but to go through the recruitment process of interviews and to subsequently receive an new job offer." Says Els Van Der Veken.
3. Has the real reason you resigned been adequately addressed?
Counter offers typically involve an increase in salary or non-monetary benefits to encourage staff to stay. While a pay rise may be tempting, our research shows that employees would much rather accept a lower fixed salary in order to receive more career growth opportunities or to have a better work-life balance.
Remember that accepting a counter offer purely for the financial benefits may not address the issue which motivated you to consider leaving in the first place. Ask yourself if accepting would enable you to further develop your career and fulfil your ambitions.
4. Did your employer value you before you considered resigning?
It is worth considering whether you would have received the pay rise or promotion in your counter offer if you hadn’t handed in your resignation. If not, are you comfortable working for a company that doesn’t reward its employees until they have decided to leave?
"In some cases employers will offer an increased salary as a counter offer at the direct expense of a bonus payment," added Els Van Der Veken. "Particularly for professionals in fields where their bonus accounts for a significant part of their annual income this can significantly interfere with their financial plans."
Don't hesitate to contact one of our offices.