should you counter or say goodbye? By Molly Moseley
manager and a valued employee walks into your office with a piece of paper in
hand, asking for a moment to chat. As you’re handed a resignation letter, your heart
sinks. Afterward, you immediately meet with HR to share the news and start an
all-too common conversation: Should the company extend a counteroffer?
A lot of
factors must be considered when determining whether you want to fight to keep
an employee from leaving. Counteroffers can be the carrot that gets great
talent to stay, but offering one can set a dangerous precedent, too. Before
making an offer, it’s
important to take an in-depth look at what the employee brings to the company.
questions to start with:
employee in good standing?
does the employee bring to the table?
employee have potential and leadership ability?
employee fit the company culture?
employee’s job be difficult to fill?
the resigning employee’s perspective, why are they leaving? If the job isn’t a
good match or if there is a lack of career-advancement opportunities, consider
whether the company would be willing to move the employee to a new department,
pay for training or provide a promotion. If she is leaving to move across the
country to be closer to family, you’d be hard-pressed to keep her (unless you
can provide a transfer or allow telecommuting).
If pay is
the reason for the move, you may be able to influence her to stay with
additional compensation and benefits. In doing so, you could retain talent and
maintain productivity. This eliminates the cost of finding and training a new
hire, or worse, experiencing a bad hire, which can cost up to five times that person’s
annual salary, according to a study by the Society for Human Resources
in mind, a financial counteroffer in itself may not be enough to maintain
employee satisfaction. More than 50 percent of employees who accept counteroffers
change companies within 24 months anyway, according to a Pittsburgh staffing
In the more
extreme cases, if you believe the employee is disgruntled or has been unhappy
for quite sometime, it may be best to let them go. Even if you do decide to
make a counteroffer she can’t refuse, it may only serve as a band-aid on the
bigger issue. In the end, you just might be delaying the inevitable. Do seek to
understand if the issue is unique to the employee or indicative of a broader
issue that could lead other valuable employees to resign as well.
if your big-picture vision doesn’t align with the employee’s vision, it might
be time to say goodbye.
best solution? Keep employees satisfied so they don’t resign and you don’t have
to think about counteroffers at all. To do so, maintain open lines of
communication to ensure employees are happy. Use some kind of performance
review to identify areas of growth and offer options. When you keep your ears
tuned and your eyes open, it’s pretty easy to notice when good employees are
starting to feel dissatisfied.
The Rogan Group