Google the word “counteroffer” and you’ll see plenty about the supposed potential impact. As is typical on the Internet, everyone who wants to will weigh in with their five cents. For recruiters, counteroffers resemble what a baseball player experiences when they’re tagged out at home plate.
It’s no secret that a recruiter’s goal is to fill a position. Ideally, the candidate is jazzed with the offer and the hiring firm is eager to welcome the candidate. The recruiter is paid. (Note: this is true for a recruiter working on contingency vs. retainer.) And everyone lives happily ever after. But any recruiter who has worked on a mess of searches knows that sometimes things won’t end well.
No matter how many times a recruiter establishes with a candidate what they’re seeking and how successful they are in securing their asks, a counteroffer is still a possibility. Candidates may claim they’ve no interest in a counter. And they may say they want to give their current employer a chance, but are ready to leave. That doesn’t mean they’re being genuine. And perhaps it’s because recruiters aren’t always responsible and trustworthy, some candidates are more comfortable not being forthcoming. So, a recruiter can ask a candidate for their wish list as it relates to compensation, title, vacation, etc., and a hiring firm can knock themselves out to meet every single ask. At that point, it may appear that things are moving forward and everyone’s on the same page. The recruiter can question the candidate a dozen times: will you take a counter if your asks are met, and the candidate can assure the recruiter, never ever. And then, take the counter. Recruiters who’ve had this experience often think they shouldn’t bother to mention the topic. Others mention it and think they’re throwing a monkey wrench into the equation. While still other recruiters will ask a dozen times, hoping they’re not being misled.
The outcome of accepting a counteroffer can vary. Just as the reasons candidates accept them can. For example, one candidate worked with a recruiter for approximately 16 months and ultimately accepted a counter. The explanation: permission to work from home once a week was offered to her by her current employer, and that meant the world to her. This decision was made, despite the compensation package, which was sizably larger than what was requested. Another candidate declined to leave her existing employer after all details were agreed upon, saying that she had been assured of a great future and that her current employer would consider her for more than one potential trajectory. A third candidate, who said about two dozen times that she’d never take a counter, lied. No real explanation. A fourth panicked because he was anxious about the future and wondered what would happen to him at another firm. In appreciation, he sent a fruit basket. One individual accepted counters twice, at the same firm; it was a clever strategy to increase his compensation. Ultimately, he left. A sixth claimed adapting to a new firm seemed unnerving.
What happens to candidates who stay? Some delight in the compensation increase and feel all is well. Others have a different experience. Often, they don’t stay for long. Some who do are mistreated by management that feels abused, or even tricked. Many are never trusted and find their trajectories stunted. While in the short term, their compensation packages may be increased, long term that’s anything but the case. Senior managers seldom recover from the experience. Typically they do all they can to make sure that the person who is now being paid more has more work. And if there’s a round of layoffs, well, no one is indispensable. Cutting a more expensive employee often happens. Sometimes the dynamics can be altered, either temporarily or permanently. It’s a bit like after a spouse learns that their husband/wife has cheated. The recovery can be long. If, indeed, there is real recovery. Moreover, the candidate may find they will be negatively impacted long term by the industry and/or the recruiter. Part of that is determined by how the candidate extracts themselves from the situation. An HR representative or a hiring manager may, themselves, move in the future. And the candidate who accepted a counter may turn up at the new firm, encountering these familiar faces, claiming to be interested in a role. Because folks tend to remember who accepted a counter, they may discourage their new firm from pursuing the individual, so as to avoid a repeat performance. In short, feigning interest in an opportunity to ultimately secure a counter may well catch up with the candidate.
Years back, several in a compliance department at a large bank pursued offers to secure counteroffers. The goal: find out their value in the marketplace and then convince their employer to raise their compensation. This generated a lot of resentment among those who were, as one person said, “loyal”. Around the same time, two other large financial institutions decided that they would identify anyone they thought was underpaid and increase their base salaries. This was unusual, in particular, because the salaries adjustments, some as much as 30%, took place in the months of July and September.
Candidates, after a first round of interviews, are allowed to excuse themselves from the process. And it’s OK not to explain to anyone their reasoning. Sometimes a candidate may sense the role isn’t a fit. The manager isn’t a match. Or the vibe of the firm isn’t comfortable. That’s for them to determine. But, if a candidate decides to proceed, and the hiring firm ultimately presents an offer that meets the candidate’s expectations, as they relate to compensation, benefits, vacation, starting date, title, then the candidate ought to accept the offer. Because if a company does produce an offer in good faith in a timely fashion, it suggests that the people who work there are reasonable and have been respectful of the candidate.
The best approach to counteroffers: avoid them. When a candidate goes to resign, they can simply tell their boss, they don’t want to consider a counteroffer because the next step makes sense for them. In short, decline one, before it’s presented. That’s the sign of a real professional.
In the small world that we live in, that may be the most reasonable way to navigate this component of the search process.