Salt’s APAC CEO Jacqui Barratt shares her thoughts on counter-offers and whether it’s the right move for you.
Recruitment costs time, productivity and financially — whether you manage this internally or utilise external expertise, so it’s natural when that resignation hits your desk to have an immediate desire to consider the counter-offer!
Tail spinning into a panic about losing an employee and throwing money at them to stay isn’t the answer (even though many employees may want to instigate this salary tug of war for their own benefit). In fact, we’d go so far to say that almost always, a counter-offer is not the way to go and typically the statistics show only has a lasting impact for about 6 months. This is why.
- Why do you want to hang onto someone who doesn’t want to be there?
It might be crunch time for your business and you might suffer somewhat by losing a key member of your staff, but hopefully you have built your team in such a way that the hole won’t be visible for long. A strong workforce structure should ensure someone can step in while you work to replace lost talent.
After all, even if someone incredible is leaving, you will survive. You will stay in business. If you clutch at straws and beg them to stay by throwing money at them, you’re suddenly in a precarious position and have set a precedent that may trigger similar behaviours in the business. If your role is incredibly niche and is business critical, speak to your recruitment specialists internally or externally to understand current market dynamics and the reality of being able to secure this talent, so you can make a considered decision.
- C’mon, you know it’s not a long-term solution
If recruitment and retention has taught you anything, it should be that in order to fix talent problems, you have to deal with the underlying issues. A rapid counter-offer isn’t necessarily fixing the fundamental reason the person was leaving in the first place. Do you truly know what that reason is, and can you truly do anything about it or are you simply buying time? It’s a short-term fix that may not do any good in the long run.
- Consider the ‘golden handcuffs’
Counter-offers may make an employee feel special. After all, it’s nice to be fought over. But it doesn’t take long to recognise they may be putting a performance target on their heads that they just can’t deliver, if they demand or receive an offer which is outside of their true worth.
Employees who are restrained by these ‘golden handcuffs’ may be happy now, but if they cannot deliver to the new expectations; we are setting the employee up to fail and equally putting pressure on the business.
- Gain a deeper understanding around why they’re leaving
An unhappy employee can only be retained by excess amounts of money for so long. Make an effort to get a deeper level of understanding and find out just what their issues are. Is this about their bosses? Their colleagues? The late nights and missed social engagements because of crazy deadlines? These issues and a whole host of others cannot be remedied with money. Reach a deeper understanding and you may be able to keep the employee, their current salary, and their loyalty and happiness.
At the end of the day, some employees will have just run their course with a company. If you can find out what is bothering them and it’s something that you can fix, that’s great! If you can’t and your only solution is to throw more money at them, you may be better off to let them go.
You’re in a much better position to part ways amicably with an employee than cling on to one who is unhappy. This will only lead to a negative ending for them and for your company.