Is It Ever A Good Idea To Accept A Counteroffer?
Karen Young Kreeger

Employees receive counteroffers in two ways, notes Gary Cluff, a recruiting strategist and consultant, and principal of Reston, Va.-based Cluff & Associates. The employee who gets recruited away gives notice, and the current company responds by issuing a counteroffer unexpectedly. On the other hand, an employee could be testing the water externally with the hopes of getting some offers to come back and negotiate for a counteroffer. The second scenario, he says, is frowned upon because if the current employer recognizes what is happening, that employee's place at the current company may be at risk.

Counteroffers primarily take the form of more money and possibly a promotion, says Barbara Bruno, president of H&R Search, a search firm based in Chicago. For example, whatever the employee's next raise and title would be, that's what the counteroffer could be. "The funny thing that happens--and the reason that it's negative to take a counteroffer--is that most people don't leave their company because of money," she says.

Taking a counteroffer can also send the wrong message to future employers. Ten years ago if an employee had more than three positions in ten years, Bruno's clients would not interview them, considering them job-hoppers. Currently if she presents a candidate who had been with the same firm for 10 years to a client company, that hiring company would react by asking, 'What's wrong with them? They've never taken a risk.'

"It's totally flipped now," says Bruno of the perception of job stability by hiring companies. By her estimation, employees are changing jobs every two-and-a-half to three years. What's more, companies expect that, especially at higher levels.

It's Not About the Money
If you're contemplating taking the counteroffer by your current employer, experts agree that you should ask yourself: Why did I begin to look in the first place? Analyze whether the counteroffer really fixes any of the issues or problems that prompted your search or your serious consideration of a new position.

James Burke, who recently retired as the manager of technical recruiting at Rohm & Haas and presents career workshops for the American Chemical Society, suggests that employees considering counteroffers also ask themselves some questions about their current employer: Where's this company going? What's in the product pipeline? What are my feelings about the future of the company? After an honest assessment of these issues, he advises that if the employee has a trusted mentor inside the company who's not their supervisor, have a long talk with this person to hash out your concerns out loud.

In Bruno's experience employees might take a counteroffer because the increased salary intrigues them, but she has found that there's always something else going on that would make the employee go through the stress of changing jobs. Some of the reasons that people cite to her for seeking greener pastures include the current company doesn't keep up with technology; upper management doesn't interact with the rank and file enough; and the lack of a 'real challenge.'

If an employee takes a counteroffer, Bruno sees two scenarios emerging: the company now knows the employee's been interviewing elsewhere, so when it comes for future promotions and raises that usually doesn't happen. And, the candidate now asks him or herself: 'If I were worth this raise, why did I have to threaten to quit to get what I was worth in the beginning?' Which in turn makes the employee realize that their initial reasons for the search weren't probably about money.

But to Burke the question of loyalty and showing your hand in negotiating a counteroffer is passé. Companies, especially larger ones, due to repeated downsizing, will be looking out for their own interests no matter what happens to the individual employee. "And employees seem to understand that," he notes.

In presenting a counteroffer, the motivation behind some companies is that they have been remiss in managing employee retention. "The company making the counteroffer is very often trying to create a temporary stopgap to the loss of an individual, hoping that they can find someone to replace him or her in the near future," says Cluff.

If you do take the counteroffer, however, Burke advises that it should come back in writing. "It should be basically an offer letter," he says.

Other Considerations
The art of negotiating a counteroffer can be tricky. Here are some pointers:

• The length of time needed before getting back to the offering employer depends on the urgency of the job. "I think if they really respect you, you can negotiate more time. They have an urgent need to fill the job, but you also have an urgent need to make sure for them and for you that you are the right person," says Burke.
• Research the salary range and responsibilities of the new position before telling your supervisor about the new offer. Make sure the new company has a good financial position and a product line that will keep it in business. Additionally, ask if the new company is likely to be acquired, in which case you might be out of a job sooner than you think.
• Don't 'nickel and dime' during the negotiations. Be prepared with what you will accept before going into your meetings.
• Noncompete agreements can come into play when taking another job. These allow for assurances, generally in writing, that the area in which the employee will be working for the competitor will be outside what the person was doing at the current employer. This holds true for about two years.

Dealing on a Good Note
You can't demand a counteroffer. And, don't put your boss on the defensive. If you go in with a set of demands, the chances are they'll turn you down. When talking with your boss about a counteroffer, be forthright but fair, explaining calmly and honestly why you are job seeking in the first place. One possible approach: "I'm sharing this with you because I respect you. What do you think? Is there something that can be done internally? Or is the best thing for me to do is leave?"

"Don't ever burn your bridges," adds Cluff. "If you get an offer that you just can't refuse, and you do get a counteroffer, the person should be prepared to respond in such a way that if the new opportunity doesn't work out there's always the possibility of coming back." He says that an employee could say something like this in an exit interview or other appropriate setting: "This is an opportunity I can't refuse. I like the people here. I like the job. I know I'm taking a little risk, but I would like to think that I have a good relationship here, and if it doesn't pan out to be all I expect it to be, perhaps we can talk about getting reconnected someday." Try to keep the door open on behalf of both parties.

No matter what you decide about taking a counteroffer or not, Burke suggests that all jobseekers should take a five-year career outlook, asking themselves, "Where will it lead?"

Karen Young Kreeger is a freelance science writer based in Ridley Park, PA.

Related Sites:

The 2001 Randstad North American Employee Review reports the results of a survey of over 2,600 Americans and Canadians, ages 18 to 65, to learn what they want from their work experience.

From CareerJournal.com:

Why Counteroffers Are Lose-Lose Propositions.

Should You Accept Your Employer's Counteroffer?