The Counteroffer

A few months ago I got a frantic call from a client asking for advice. Out of the blue, a key manager had just given their notice. My suggestion was, as long as they are not going to a direct competitor, to wish them well. From the silence on the other end of the line, I could tell that is not what they expected. This was confirmed when, in a direct tone, they responded with “I was calling to discuss what our counteroffer should be.” My response was simple and direct, “Don’t do it.” After a difficult back and forth, my client went against my recommendations and made a counter to get them to stay. Both parties settled on an amount that equated to a raise of 28%. 

Now there are times when you should do whatever possible to keep a key employee. However, these situations are few and far between. In most cases, the reason is because the employer has been painted into a corner because the employee (and they alone) have gained certain expertise or knowledge that walks out the door when they leave. If this is the case you should do whatever you have to do in order to keep it. However know that this is a temporary situation and that expertise needs to be captured in the next 3-6 months.

Why? Because study after study show that they are going to leave anyway.

In my experience, it is not uncommon for the company to get a case of “buyer’s remorse.” If we are paying them more, we expect more right? So we add to their plate and, since we don’t want to be in this position again, will expect them to cross train others in key aspects of the job. Mostly, it is an emotional response to the feeling of being betrayed. For the individual, the extra money has not changed the reasons that made them look for greener pastures. In fact, they might think that since the company was so quick to offer more money, they were being underpaid all this time. Plus, now they are labeled a flight risk and, in most cases, are no longer in the inner circle.

The reason I bring this up is because I got a call from this client yesterday. Guess who just gave notice, again?