Counteroffers: when to talk about them, and how to deal with them
Counteroffers are a hurdle that every recruiter will face. Whether you’re in your first year as a consultant or 10 years into your career, it’s something that will always be involved in the recruitment process. In the current climate, counteroffers are rife – so if you have recently experienced an influx, just know that you’re not alone.
But, understanding how to manage counteroffers and guide a conversation on them well is one of the best skills that you can possess as a recruiter. Not only will it save you disappointment when a candidate accepts one, but it will allow you to operate on a consultative level with both candidates and clients.
We recently had a session on counteroffers, and we wanted to share some of the key takeaways with you as well as some tangible tips and ways in which you can prevent them, and navigate them.
So, when should you talk about them?
A counteroffer should be discussed as early on in the process as possible. If you have a candidate booked in for an interview, the topic of counteroffers should be broached before they interview with your client. Not only does this create awareness with your candidate that they may face a counteroffer, but it allows you to do your due diligence for your client and have as much control over the process as possible.
TIP: If it feels right to, then you should bring up a counteroffer even at candidate qualification stage so you can have the conversation sooner rather than later. You can then advise them to speak to their employer before you start the process, rather than having to deal with it later on.
The earlier you uncover the possibility of a counteroffer, the better you can mitigate the risk it poses to your process.
However, it can be difficult to instigate that conversation if it doesn’t naturally come up. Some conversation starters you can use are as follows:
- In previous roles, have you ever had to consider a counteroffer? If so, how likely do you think a counteroffer is in your current scenario?
- What would a counteroffer need to look like from your current employer to keep you?
- How comfortable are you talking about counteroffers if one were to arise with your current employer?
- If your current employer increased your salary, would you stay?
- What would you do if your current employer gave you the promotion you were after, would you stay?
Equally, softer questioning around motivations and goals will allow you to uncover candidates’ true intentions when interviewing. In some situations, you may well get a candidate who is interviewing purely to get a counteroffer from their current employer.
Ensuring that you dig deep and understand their reasons for leaving (especially if they are a passive candidate and you have headhunted them) can help to prevent counteroffers rather than having to deal with them later on in the process.
TIP: Your notes are your best friend. Get comfortable making detailed notes on each candidate call so you can relay the same, accurate information back without hesitation later on in the process which is KEY!
The importance of testing commitment
Even if you’ve done all the questioning and probing in the early stages of the process, you may still have a gut feeling that your candidate isn’t serious about the opportunity, or they are presenting red flags that would lead them to not progressing in the process or, equally, accepting an offer.
This is why you should test commitment as much as possible.
Some questions you can ask are as follows:
- Have you shared your frustrations with your employer? If so, what have they said?
- Why has your promotion/salary increase etc not happened? Have you raised this?
Also, you are well within your rights to call a candidate out and explain to them that you feel as though they may not be 100% committed to the process.
At this stage, the candidate should be able to seamlessly relay to you why they’re committed. If there is hesitation or you aren’t convinced, dig deeper until you get an answer you’re satisfied with (no matter the outcome).
TIP: You can encourage your candidate to have this conversation first before you start the process, this could be a great way to test their commitment.
How do you deal with a counteroffer when it comes up?
Although one of the most common counteroffers is a better package or a higher salary/bonus structure, there are counteroffers that can come in many shapes and forms, thus making them slightly harder to navigate.
We’re going to highlight three different types of counteroffers and how you can manage them both from a client and a candidate perspective.
A financial counteroffer is the most common, and usually results in the candidate receiving a much higher package to incentivise them to stay with the business.
Candidates: If you encounter this type of counteroffer with a candidate, it’s important to remind them of their motivations for leaving, as well as having a candid conversation with them about what that counteroffer looks like. Will it solve their current pain points? And, if not, do they feel like a financial incentive is enough for them to stay?
TIP: Remember to continue to remind them of their WHY for leaving throughout the whole process. For example, if the only reason they were open to looking was financial, you will always be susceptible to counteroffers. It has to be more than money!
Questions you can ask:
- How do you feel this counteroffer affects your current offer with X client?
- How do you feel this counteroffer will enable you to achieve your motivations/goals/aspirations that we discussed throughout the process?
- Do you feel like the package offered is enough to give you the job satisfaction you’re looking for you?
- You said your reason for leaving was X. How does this counteroffer make you feel now?
- Why do you think it has taken them for you to leave to offer this increase, did they not see your value beforehand?
Clients: At this stage, the only option that your client has is to offer them the same package or slightly higher, especially if they really like the candidate. However, you have to also prepare for the client to pull their offer if they are unhappy with the counteroffer the candidate has received.
Questions you can ask:
- How open would you be to matching the current counteroffer?
- How does this counteroffer affect your current view of the candidate?
TIP: You should be educating your clients on the counteroffers happening in the market right now. Your clients should not be surprised that they have received a counteroffer if you have done your job well!
Flexible working counteroffer
A flexible working counteroffer is usually seen in situations where a candidate is leaving due to lack of flexibility or even relocation.
Candidates: If you encounter this type of counteroffer with a candidate, it’s important to understand exactly what the counteroffer looks like, and most importantly, how they feel about it. Don’t assume that flexibility or remote working is what they want, again, remind them of their motivation and goals as well as leaving, and ask them how this works against their counteroffer.
Questions you can ask
- How does this counteroffer look against the current places you’re interviewing at?
- What does the flexible working agreement look like? Have you got it in writing?
- Would this counteroffer be enough to make you stay?
Clients: Similarly to a financial counteroffer, the only option your client has is to match what they have been offered. Equally, your client may not have the capacity to do this, so you would have to approach this on a case by case basis. You should educate your client on the market as much as possible, as well as what other companies offer.
Job role counteroffer
A job role counteroffer happens when a candidate is offered an internal transfer or even a fast-tracked promotion to get them to stay.
Candidates: If you encounter this type of counteroffer with a candidate, it’s important to find out the responsibilities of the opportunity as well as how they feel about it.
With an internal transfer, you must find out whether they will need to undertake a full interview process for this, as not only will this stall your current process with your client, but you can also remind the candidate that they may not be successful even if they do interview. This scenario can be very tough to navigate, but if you ask the right questions, you can still regain control of the process!
Questions to ask:
- What are the responsibilities? How does this new role align to your motivations and goals?
- What does the package and progression path look like for this opportunity?
- How does this counteroffer affect the current process you’re in?
- Why did it take for you potentially leaving for them to offer a promotion?
Clients: In this situation, it can be difficult as asking your client to be flexible with responsibilities or even re-interview for another role, as it can be time-consuming. However, the best thing you can do is relay the information to the client and find out how flexible they would be for the candidate.
Question to ask:
- How likely is it that a transfer/role like this is currently available in your organisation?
- Is the current role open to any tweaks as X counteroffer looks like X?
Mastering a pre-close
Pre-closing can also be a great way of managing counteroffers as it is a subtle reminder at each stage of the process to get candidate commitment and uncover any potential issues or change of heart.
Pre-closing should happen as early in the process as possible. Not only does this allow you to manage counteroffers, but it gives you better control (and confidence) of the situation. This also allows you to manage the process seamlessly from a client perspective as you’re able to relay this information back to them immediately, at each stage of the process.
Some questions you can ask around this:
- If the client offered you X and X, would you accept?
- What are your thoughts on this offer overall in comparison to other processes you are going in?
- What would the offer need to look like for you to accept?
- If the client offered X, could I accept on your behalf?
Finally, remember some situations are completely out of your control
If you are talking about counteroffers as early as possible, and doing everything in your power to manage the process, but a counteroffer still manages to slip through – try not to be too hard on yourself.
In recruitment, there are things that are out of your control (even if you have the best process in the world), and instead, try to see these situations as moments to learn from, and do an “audit” on the process to see how you could improve!