What is a Counter Offer ?
A counter offer or ‘buy back’ is quite self-explanatory. It’s a term used when a current employee hands in their notice at their current company, to perhaps join a rival. This in return is countered by the current company offering better terms than the new proposition.
Why do companies do it?
Current employers often counter the counter offer due to costs of replacing the want away candidate. The costs of replacing an employee can cost over £10,000 pounds, that £5,000 salary increase doesn’t see so much now does it?
The costs of replacing personnel are not just financial, take the position of an Account Manager or Account Director for example- these individuals are usually the ‘face of your business’- client facing. They may have won the new business; they may have liaised and developed a strong rapport and understanding of the brand. The loss of this key individual could eventually lose you a client.
Why would accepting a counter offer be bad for a candidate?
Short term this can seem a step in the right direction, a good reaction from your current employer- seeing your bosses scrambling around to offer you more money can, in a way be flattering. This can have detrimental effects in the long term however. You may find your relationship with your employer, and your standing with the company, has essentially changed. You’re now the one who was looking to leave.
There is a reason that you started exploring your options in the first place!
While more money is always a stimulus, more often than not, there are also other factors that have driven you to see what’s out there; personality fit, dislike of colleagues/key decision makers, boredom with the work, lack of recognition, unrealistic deadlines etc. Those factors aren’t going change, and will likely start unsettling you again as soon as the glow from your salary increase wanes.
Even if you get more money out of your company now, think about what it took to get it. You needed to have one foot out the door to get paid the wage you wanted, and there’s no reason to think that future salary increases will be any easier
How to deal with buy back
A good recruiter will always introduce you to buy back in the initial stages of contact-even before you go for interview. This helps hammer out your exact reasoning for exploring fresh opportunities. Being introduced at an early stage will also reduce the temptation to accept a counter offer –if you weren’t aware of the reasoning of buy back and you are only talked through by a recruiter after the counter offer has been presented to you, your thoughts may well be irrational. Is the recruiter only trying to talk you out of accepting it because they will lose commission? At least if you, as a candidate is introduced at the beginning of the process then you will have a better understanding of why counter offers happen and the recruiters real intentions.