How To Make a Counteroffer To Retain A Current Employee

Having an employee resign, no matter the reason, can be difficult. It means you will have to go through the hiring process to hopefully find someone to replace the employee who is leaving. In the meantime, your remaining employees may be left with the task of picking up some extra work until the position is filled. Luckily, there is a way to prevent this. You can give the employee a counteroffer to hopefully stay. This can be difficult, but if done correctly, your employee may opt to stay.

Hire someone who will be long-term

The best way to avoid quick layovers and minimize needing counteroffers is to hire employees who will be with your company for a while. Life happens and sometimes employees do need to change roles to fit their circumstances, but it is important to hire long-term employees who are committed to the company, not just a position. Avoid using experience as the main test of an employee’s skills. During the interview, ask the candidate about their long-term goals. Ensure that the candidate is excited about the company and role and is not just settling for the job.

Consider the employee

When deciding whether or not to make a counteroffer, consider what kind of employee they are. Are they hardworking and constantly meeting goals and deadlines or are they lazy and arrogant? If they are hardworking and regularly meet goals, they may be a good candidate for a counteroffer. An employee who is at the maximum end of the salary for the role is someone you will likely have to allow to leave. You know your employees and how they are. Use this to your leverage during the process.

Communicate effectively

The conversation can be difficult for both you and your employee. They likely have their mind set on leaving while you are doing everything in your power to have them stay. Put yourself in their shoes. What would make you stay if you were them? Is there anything you can change about the company culture moving forward? Look at things from your employee’s view, not just as a manager. During the conversation, be clear and concise in your goal. Avoid bringing emotion into the equation as this will make the conversation even more challenging. Have the conversation in a private place and keep it low-pressure.

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Know what to offer

While you may immediately think of the salary as the main part of the counteroffer, there are other things you can include as well, which is beneficial if salary increases are not currently in the budget. Many people resign due to a lack of growth opportunities, flexible scheduling, and other perks. When you have a meeting with your employee and make the counteroffer, if they still say no, ask what kinds of things may change their mind. Even if they do not stay, you can use this feedback to implement changes in your company moving forward. It may be tempting to match the other job’s starting rate, but your employee may be upset that you did not give them more.

Anticipate a “no”

No matter how well the conversation goes, there is always a chance the employee will say no and still decide to leave. In many instances, an employee will take a counteroffer from the current company and end up finding an even better offer elsewhere. Providing a counteroffer may sound like a great plan, but your company may not even be able to afford a salary increase or other perks you may offer. In these cases, it is better to let the employee move on and do their thing. While you are creating a counteroffer, you may want to create an updated job listing and prepare for the hiring process even before starting. This way, if the employee ultimately says “no,” you will not be scrambling to start the hiring process.

Follow up

No matter the outcome, it is still important to follow up with the employee. If you are not successful, give the employee an exit interview where you can find out what you can do better as an employer and company. This allows them to give you insight as to what it is like to work in the company as an employee. The feedback will help you make changes for the remaining employees.

If you are successful, keep in touch with them as they continue working with your company. Ask how you can accommodate them and put this feedback into action. You are being given a second chance to do right by your employee. Ask for general feedback from all of your employees as well, as this employee may not be the only one who is considering a job change.

Making a counteroffer can be difficult to navigate, but if done correctly with the right person, it can work out well and provide a great experience for both parties involved.