It’s the sentence that strikes fear into the heart of a manager when uttered by a rock-star employee: “I’ve got an offer from another company, and I’m seriously considering it.”
No one is irreplaceable, but some people are harder to replace than others. If you definitely need this particular employee, you’ll need to make a counter-offer. Before you go down that path, however, make sure it’s the right decision, and plan to approach negotiations the right way.
First, remember that studies show that many workers who threaten to leave, but then stay as the result of a counter-offer, end up leaving their employer a few months later, anyway. When people go far enough down the road of leaving to actually get offers from another company, they may have already mentally checked out of their current position. Once they experience that change of mind, it can be hard to refocus on the job at hand, no matter how good the counter-offer is.
You also should ensure that your company can afford to keep the worker. Financial realities may make it impossible for you to match the employee’s new job offer. If you can’t keep your rock star without breaking the bank—or creating obvious inequality with other high-performing employees—find a way to be content with letting her go and firing up your recruiting engine.
Finally, consider what kind of person this employee is. Will she get lazy or arrogant if you keep her on the team by giving her a generous counter-offer? If she’s already a top performer, that’s unlikely, but it’s worth considering such things before creating a package to keep her on board.
If you work through these possibilities and decide your employee is so vital that you need to make a counter-offer, don’t start by throwing wads of cash her way. Take a deep breath, consider your circumstances, and build the kind of offer most likely to bring success:
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Start with a conversation.
According to an article from Monster, the first step in a counter-offer process is to talk to your employee about why she is considering leaving. “Is it really because they feel underpaid here? The more you understand the person’s underlying motivations, the better your chances are of offering what matters most to them,” the article says.
Consider non-monetary offers.
Perhaps an additional week of paid vacation every year would help keep this employee in the fold. Even better, you may want to offer increased flexibility, like the opportunity to work from home a couple of days each week or shift hours earlier or later to avoid commuting headaches. If the person is excelling in her current position, look for ways to increase her authority and responsibility. You should know what motivates this employee, so use those levers in your negotiations.
Be thoughtful about your financial proposal.
Don’t shoot too low or too high as you start negotiations. “Let’s say, for example, an employee making $50,000 comes to you with an offer from another organization at $60,000,” says an article from Workopolis. “’For the employer to come back and counter at $52,000 or $53,000, I don’t think you would expect that individual to stay within the team,’ explains (Aimee) Rieck, (senior manager of human resources at Workopolis). ‘I think you need to do what’s reasonable, what’s in line with your salary scales, and what’s doable without overselling or over-committing.'”
Don’t forget to follow up.
Even if the employee accepts your counter-offer, your work isn’t done. Having considered a departure from your company once, they may be ripe to do it again. “To avoid this, you need to proactively engage with them, make sure they’re satisfied, and ask how you can better accommodate them,” says an article from The Medium. “You should view this new situation as a second opportunity to right whatever wrongs they felt during their first period of employment.”
Accept that you might not succeed.
Even if you make a great case and build a solid package of financial and other enticements, your employee may decide to go elsewhere. If your negotiations fall apart, know when to stop trying and move on. If you can end your employee’s time with your company on a positive note, she’ll remember that when friends and acquaintances—a.k.a. potential hires—ask about your professionalism. A pleasant departure is better for everyone.
Knowing when and how to make a counter-offer is complicated, but if you follow these guidelines and take the time to be thoughtful and creative, you can learn this art. That can help you keep your most talented workers when other companies come calling, so it’s definitely worth the effort.
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