What you’ve heard from your friends is true - companies are offering counter offers to employees who are considering a new job opportunity in a bid to retain them.

Counter offers are often considered a last-ditch effort by employers to keep their people from leaving the company. It usually come in the form of a significant increase in salary offer, employee benefits or both.

While counter offers may seem flattering and tempting in the first instance, the push factors that have led to your initial decision to leave still exist, and are very likely to persist in the future.

Before you use the counter offer as a bargaining chip, make sure you understand the pros and cons, and the potential downfalls of accepting it.

why employers counter offer

As a general estimation, the cost of replacing a middle-level employee is around one-fifth of their annual salary. This turnover cost will only increase with each progressive level of management. Such hiring costs include recruiter’s fees, time and resources spent on interviewing and onboarding the new hire, as well as offering a competitive offer to match the increasing candidate’s demands and salary expectations.

Taking all of that into consideration,  it’s no wonder that many companies find it more worthwhile to pay a little more money to retain their existing staff to minimise the cost and disruption to their business.

why accepting a counter offer is a bad idea

Even if you have accepted the counter offer, there will always be this feeling that your employer might hold it against you for having expressed your desire to leave.

Some employers might even see those who ’wanted out’ as a problem, or even question your loyalty, especially now that they are aware of how unhappy you have been.

The irrevocable damage to the trust and relationship you’ve had with your employer could have a knock-on effect on your future career prospects. This may be evident during promotion period or when there is an opportunity to expand your portfolio for career growth.

The working environment can suddenly become a very uncomfortable place to be. Research have shown that 90% of those who have accepted a counter offer end up leaving the company within six months of doing so. It is important to remember that the problems which have led to the intention to resign are not likely to  go away overnight. Very little will actually change, which could potentially lead to increased resentment on both sides.

implications of counter offers

Another important factor to consider is how the current employer intends to fund the offer that has been made. The rise in salary could just be the next pay rise being given early. When the actual salary review comes around, you could find yourself stuck with a salary you were meant to receive in the first place.

While accepting a counter offer can bring about satisfaction in the short-term, it comes with undesired consequences and disadvantages.

before you resign from your job, always ask yourself three questions:

  • What am I unsatisfied or unhappy about?
  • If I speak to my line manager about what is making me unsatisfied at the job, will he or she be able to help turn things around?
  • Does my current employer offer me the opportunities that I am seeking, or do I have to leave to attain my career goals?

If you are already on a lookout for new and exciting job opportunities to further your career, our advice to you is to follow through and move on.

looking for new, exciting career opportunities? Reach out to us and send us your CV!

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