How to Deal With Counteroffers – Part One: Candidates

Let’s talk counteroffers. Over the last twenty people I have placed at HireStrong, eighteen have received counteroffers. The most recent candidate received one of the highest counteroffers I have ever seen; now that I think about it, she did receive the highest counteroffer of the candidates I’ve placed. Thankfully for me, she turned it down, unlike the other candidate I almost placed five years ago. I’ll use this example in this article to talk about how to deal with counteroffers.

The time to start talking about counteroffers is in the first conversation you have when profiling the candidate. Typically I spend an hour on the phone with candidates. A considerable part of that conversation is discussing their susceptibility to counteroffers. If they tell me they’d consider them, I take note, and usually, continue representing them. Unless on a scale from one to ten it’s an eight they’ll accept a counteroffer. If that happens, I move onto advising them about how to ask for what they want.

I’ll ask questions such as why they are considering leaving their current employer, what would they have to do to keep you, what happens if they give you what you just stated in a counteroffer, have you asked your current employer for these things you want to see changed, and more.

I then will cover the risk of accepting counteroffers. The company didn’t have this money planned to spend until you tried to quit, and therefore they will look at you when hard times come, and they need to cut costs. I’ll also give an allegory about “would you cheat on your wife/husband and then change your mind after informing them of your infidelity and intention to leave. How would your relationship change?” Feel free to use your allegory or mine; they are very useful in getting individuals to think about the repercussions of their actions and how things will feel afterwards.

I did all of these and more discussing the risks of taking a counteroffer. When it came to this particular candidate who had been with her employer for over a decade, she got a counteroffer for a raise from $95,000 to $165,000 and a promotion to Engineering Manager with a relocation to California. Initially, they offered her, $125,000, and she almost accepted that offer! I had to pull out all the stops re-discussing what we already covered, including the “Why would they pay you so much more when they wouldn’t before?” (She had already asked for a raise, and they gave her a raise just a week before getting my offer). She went back to them discussing all the concerns I brought up which included the cost of living increases, what would her husband do when she relocated (apparently go back and work for the company as he used to work there), state of income taxes, so she asked for an $80,000 raise, and they came back with a $60,000 raise.

Why did she end up rejecting the offer? They pay their engineers the same in California than they do in Texas, which she found out from their HR, and so she felt slighted because they could have always been paying her more and she already felt undervalued and underpaid. They were also “creating” the Engineering Manager position. All the issues we discussed before if they weren’t already paying when you asked for it before a counteroffer, why accept it afterward; what happens in a downturn when they didn’t need this manager role in the first place, and they couldn’t afford it before, etc.

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The advantage of having discussed this previously is to prepare their thought process and “plant seeds” that will grow. Hit on that pain point for why they were looking to leave in the first place; this particular candidate was a five out of ten urgency as she really wasn’t looking for better opportunities and they needed to be in a specific type of company of which mine was not. But through time we found out more information that made this job more appealing to her as I discussed what it was and how it would fix her current situation.

Because I had already prepared her for what to expect with counteroffers and how to deal with them (I try to get my candidates to turn in their two weeks shutting the door for counteroffers right away, not working this past year because of market), none of the information I brought up was new and it was more of a reminder for why they are dangerous. But it was also a reminder to her about all the reasons she wanted to leave and why my opportunity would get her where she wants in her career.

If you wait to have the counteroffer discussion after-the-fact, then you’re going to look self-serving. What you say will come across as a “sales pitch” rather than genuine advice. I’ve placed 160+ people over the past seven years, and I’ve only had six counteroffers accepted. And yes, I get to use those examples too when discussing with new candidates as most regret their decision. Don’t be afraid to use your experience when speaking with candidates. If you’re new to this industry use your colleagues’ horror stories.

The next time you represent a candidate make sure you have already found out the reasons they want to leave. Discuss the risk of counteroffers. Keep highlighting the advantages of your role and company over their situation and how it will change their pain points.

Joshua William May is an Engineering & Technical Sales Recruiter, Entrepreneur, and owner of HireStrong since 2015. He has worked as both a Technical and Executive Recruiter specialized in engineering and manufacturing for oil & gas, chemicals, plastics, and other industries. He has been a headhunter in recruiting for over 7 years. He has recently become a part of the SourceCon community enabling him to collaborate with other industry professionals. Mastered with robust traditional recruiting methods he is always seeking to learn and grow and incorporate the new technological age, without ever sacrificing the professional relationships with candidates and clients.

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