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The Trouble with Counteroffers

A situation that is sometimes expected, a counteroffer. You try to give notice to your current employer, and they respond with a counteroffer to try to entice you to stay.  It seems like the right thing for the employer to try to retain top talent, and the employee is tempted to stay with the idea of a promotion or other benefits and perks.  The reality is that it may not work out for either party in the future, here are some reasons why.

  1. Trust is broken

Assuming the employee took the counteroffer and is still with the organization, they are there after they secretively interviewed and nearly accepted a position.  Managers now question the longevity and loyalty of that employee.  Also, the employee sees the company differently, they were only willing to make changes and step up to keep the employee when they were halfway out the door.  “counteroffers are rarely a long-term solution for an exiting employee. Many recruiting websites assert that nine out of 10 candidates who accept a counteroffer end up leaving within a year anyway.”

  1. Counteroffers don’t address underlying issues

There are many motivations for an employee to look for a new opportunity.  Compensation and benefits might be one reason but other reasons include looking for a more fulfilling position, a new industry, shorter commute, work from home opportunities, career development and the list is endless.  By accepting a counter offer none of these other potential motivators are being fulfilled, leaving you to still want more after the luster of extra money to do the same work will eventually fade.  The other problem is when it comes time for the company to do reviews or layoffs, the employee that is making more money is now at risk for being one of the first to be let go.

  1. Pay people what they’re worth

Companies that pay what the employee is worth based on their performance and what the market bears will be less likely to threated to leave in order to get a raise.  Counteroffers are a way that companies are also admitting that they might have been underpaying their employees to begin with, which is a reflection of poor leadership.


While counteroffers may be the company’s knee-jerk reaction when a valued employee is ready to give their notice, it may only be effective in the short term.  A better approach would be to address problems before they become the reason for someone to leave.  And if someone gives notice respectfully part ways and hire someone new, who is eager to fill the new vacancy.

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