A counteroffer is a tricky subject. It's only given to someone after he or she has RESIGNed from their employer. At first, it can feel somewhat flattering - that your boss would make an effort to try and keep you. And you feel bad not to take it because it may seem like you're rejecting them for the 2nd time especially after they made all this effort.
Yet, at the same time, if you accept the counteroffer, you will be going back on your word and your commitment to the other company that took the initiative to make an attractive offer to you first. And you have already accepted and signed it too, which will likely lead to burning the bridge.
So before you make this important decision, what pros and cons should you consider? In this article, I will break them down for you so that you can make the best-informed and most advantageous decision for your career.
After we have discussed the pros and cons, I will attempt to answer the question, "should you take a counteroffer?" so make sure you read until the end.
Let's start with the pros.
The employer likes you.
It clearly indicates that they like you and don't want to lose you. If they didn't value what you bring to the table, they wouldn't go through the hassle of coming up with a new offer and getting it approved so quickly.
Familiarity And the second advantage is familiarity. You already know your boss, colleagues, stakeholders, systems, etc. You don't have to build new relationships or get used to new environments.
Convenience: It's convenient. You don't have to fill in new forms, go through the transition, new onboarding process, etc. It's just much more effortless.
There you go, they like you, you already know the people, and it's convenient! It's perfect; why should I NOT take a counteroffer every single time?
Before you make up your mind, let's consider the cons.
The disadvantages are a bit more subtle but still require our consideration.
The first point is: do they really love you?
I get it. As soon as you said you resigned, they have not stopped asking you to reconsider, they arranged all these meetings with senior managers to tell you how much they appreciate you, your work, and they even bumped up your salary.
But let's think about it. If your employer genuinely appreciated you so much and valued you, why didn't they give you all these things earlier? Why did it have to take a resignation for them to express their appreciation? So what was going to happen if you didn't resign? Were they planning to keep lowballing you since you're not quitting?
Not only that, counteroffers are not uncommon. Even though receiving it could make us feel special, it's a relatively common practice that employers use when they do not want to lose someone to their potential competitor.
Also, from a purely financial and business point of view, it's much cheaper and easier to give a counteroffer and retain the person rather than to start a search from scratch.
The reason why you wanted to leave in the first place
The 2nd thing you may want to consider is what motivated you to look for a new opportunity in the first place?
Was it purely for monetary reasons? Or, were there other changes and factors you were looking for, such as growth, new opportunity, learning potential, etc. Chances are, though not always, accepting a counteroffer and staying at the same company, will not give you the changes you were looking for – the reasons you decided to search for a new opportunity in the first place – except for compensation.
Downturn
For me, this is the biggest concern or risk. And that is, what's going to happen during the downturn?
See, you have to realize. It was not their initiative when a company makes a counteroffer, regardless of what they tell you. Meaning, it was not their volitional decision; instead, they were, in a sense, forced to offer all these extra benefits – and quite suddenly at that too, because you told them you resigned.
Sure, they were willing to make special approval this time because they were desperate. But what's going to happen when the dust settles? You know, when they are not desperate anymore and they are going through their numbers and budget, they remember how they had to give you a huge increment to keep you. How do you think they'll feel about it, then?
And what about when the next downturn comes, and the employer has to reduce the budget and cut costs? Who do you think they will likely target? I'm not saying this is what they will do every time of course! I'm just saying what would a natural or likely choice be? What would be the logical decision if you were the decision maker?
In conclusion:
So should you take a counteroffer?
Well, at the end of the day, it's up to you. It depends on the specific situation you're in. My intention is not to convince you one way or another. Instead, I wanted to present to you what I believe to be the main criteria to consider (including the disadvantages that many people miss because of their subtlety) so that you can make the most informed decision. I had seen cases when a candidate took a counteroffer, and it turned out well. But I've also seen enough job seekers regretting their decision and having to start looking again soon after (with fewer options available, this time).
My general rule of thumb when it comes to counteroffers is this. It boils down to two requirements.
The first one is your relationship with your boss. Do you believe that your manager is someone who can guide and help you advance in the long run – someone who will stick around and who can support you for years to come? And are you reasonably sure that your manager or boss will stay long enough with the company to be able to do that?
And the 2nd requirement is: is the employer making an irresistible offer you can't refuse?
I'm not talking about the company simply matching the salary. What is the point of taking a counteroffer that is only as good as the other one? I mean, your employer has clearly not been paying you what they believe you're worth for all this time. And even now as they are giving you a counteroffer, they are only MATCHING the other salary? Come on! What is the prospect of you being properly compensated in an environment like that?
When I say irresistible, I'm talking about the employer going above and beyond and making an offer that you'd be a fool not to take. For example, are they offering you a title promotion, compensation that is way better than your other offer, or some other change that you simply can't live without.
If your counteroffer satisfies both criteria, it could be a worthwhile option. If not, however, there are probably too many disadvantages and risks that the counteroffer isn't worth it.
Thank you for reading!
Matt