The pros and cons of a counteroffer in today’s market
Receiving a counteroffer is now more common than ever before and it seems law firms will do their utmost to retain good employees. This is especially true of practice areas where talent is in short supply.
However, in today’s candidate-driven market, does a counteroffer still hold the power it once did? How can you make the distinction between an offer that should be declined and one that may be worth taking?
What is a counteroffer?
A counteroffer is an offer intended to persuade someone to continue working for their current employer, often following a resignation. Counteroffers can include promotion, improved benefits and, in most cases, an increase in salary. A ‘bidding war’ can often ensue.
The pros of a counteroffer
One of the most common reasons employees accept a counteroffer is the promise of a salary increase, closely followed by the security and comfort of staying with a company they are familiar with. The realisation of losing a good employee may also trigger the employer to recognise and reward the individual more, which in turn makes them feel more valued.
Acceptance of a counteroffer offers numerous benefits to the employer who is able to retain the knowledgeable employee, whilst saving on the time and cost of recruiting, onboarding and training someone new.
The cons of a counteroffer
Counteroffers do not guarantee job satisfaction. After all, there must have been reasons the employee sought a new role in the first place. Are the terms of the counteroffer enough to improve the original job or will they just paper over the cracks of dissatisfaction?
Research shows that while many professionals receive counteroffers following resignation, a high percentage of those who accept return to the job market within just 12 months.
While the existing employer may now be showing their appreciation, could it be a case of too little, too late? You may have been offered more money to stay but if company culture was a key motivator, can your current employer really promise an impactful change?
Salary is not always the leading motivator behind a move, but more often than not it is the driving force behind the counteroffer. It’s therefore important to remind yourself of the reasons you wanted to leave in the first place before making a final decision.
Along with the obvious financial incentives, job satisfaction, career progression, work-life balance and general well-being are all important factors to consider when comparing offers.
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