6 ms·

I've seen this claim over and over, but never any sort of citation or numbers. Lots of people get competitive offers, get a counteroffer, and then stay for year

by GavinB 13y ago

I've seen this claim over and over, but never any sort of citation or numbers. Lots of people get competitive offers, get a counteroffer, and then stay for years. I know a number of them personally. The reason it seems like they never stay is that they don't talk about the offer they didn't accept. The negotiation happens over the course of a few days, and they don't mention it to the other employees. So there's a big bias in how frequently you hear about the negotiation. Whereas if they leave for another company, of course everyone knows about it.

fecak 13y ago
There is a lack of reliable data on counteroffers and their effectiveness due to the secrecy - companies don't have to report to some agency when they counter an employee. Another part of the problem is that recruiters are trained to scare candidates away from accepting counteroffers (I'm a recruiter), and you'll see all kinds of articles from recruiters claiming statistics about what percentage of people who accept counteroffers are gone within a certain amount of time. I've heard 80% within a year, 90% within 6 months - depends on which recruiter you ask, but the numbers seem inflated and are just used as a tool to scare someone from accepting. I distinctly remember being trained on how to handle counteroffers when I was first getting into the business. I don't use any of those tactics these days, but I am certain lots of recruiters do. The amount of publicity that recruiters give to these numbers (which usually lack a source) adds to the misconceptions.
- jcdavis 13y ago
  I suspect that those (% gone with a year) numbers vary drastically by industry, and may be 80-90% or whatever in some lines of work, but are likely much lower for developers.
  - shubb 13y ago
    Maybe a lot of people know that moving job comes with a 10-20% raise, so they take the counter offer while planning to move on in 6 months or so, meaning that they get a double raise... They might also feel they will be taken as a more skilled candidate if they can quote a high current salary, enabling them to score a better role at a better next employer. That might seem counter-intuitive, but if you know you are under market, people selecting employees for quality over price will wonder why.
    - blueskin_ 13y ago
      Definitely plausible. A higher 'most recent salary' means more money in the new job. A counteroffer doesn't change whatever conditions about a job made you leave, be it unfulfilling work, coworkers, a bad environment, long commute, etc. - unless your only concern about the job was being underpaid, which is likely far rarer.
  - fecak 13y ago
    Over my 15+ years in recruiting developers I'd say a fairly high number of people stayed much longer after accepting a counter than the most quoted 'stats' would have led me to believe. My only numbers are candidates I lost to counter or admitted accepting a counter in the past, so this isn't a huge sample. The secrecy of counteroffer benefits the company, as if it becomes known that a counter is your quickest means to a raise you can be sure others will follow suit. But that secrecy also has some benefit to the person who accepted a counter, as any potential questions about your loyalty or (in some situations) your perceived willingness to abandon the team during a crunch time won't be exposed and the accepter can continue business as usual to a degree.
    - chris_mahan 13y ago
      Secrecy is the enemy of trust.
- GavinB 13y ago
  Recruiters certainly have a conflict of interest. It would be pretty straightforward to add a couple questions to any general survey of employees in an industry to figure it out.
  - fecak 13y ago
    In the instance of a counteroffer, the recruiter is financially motivated for the person to accept the new job (and decline the counter), regardless of whether or not accepting the counter is a better move for the person. That is one of the most obvious flaws in the way the recruiting business operates, in that there are instances where the job seeker's interests may not align with the recruiter. A couple years ago I posted an article here about an agent system where job seekers were the recruiter's real client (and footing the bills), which would resolve this particular instance of misaligned incentives.
- pekk 13y ago
  That seems reasonable. There is a lack of reliable data. But citing the ulterior motives of recruiters doesn't establish that it's safe to take counteroffers. There's no reason it can't be both at the same time: recruiters do have ulterior motives, AND it is dangerous to accept a counteroffer. Waving at the badness of recruiters doesn't dismiss the issue. The risk of taking counteroffers isn't unconditional, it depends on the employer. The person evaluating a counteroffer has to consider the trustworthiness of the employer. In the best case, that still includes offering a lower-than-market wage (or how did you easily get a better offer?) While it's true that recruiters' interests often aren't well aligned to the candidate's interests, employers' interests often aren't well aligned to employees' interests either. BUT... in these cases where someone is already desperate enough to be hustling for other offers to push their employer's hand, it's already a lot more likely that the employer's interest is less aligned with the employee than the recruiter's is. Raises come out of profits and many people do take it personally and can't be professional and more importantly, decent about it. If you are facing a counteroffer, you are the person best positioned to evaluate whether your employer is trustworthy - not HN commenters, not a recruiter and certainly not your employer. I can see how people who hire on HN are scared of recruiter memes about counteroffers. A lot of us want to get rich and want shortcuts. Unfortunately, those recruiter memes align with certain realities. There is no shortcut, you (generalized you, not fecak) have to earn the respect of employees as a fair dealer if you want any rational person to want to stay or even consider your counteroffers. If you don't earn that respect, you have no right to complain: you deserve to lose the employees because you yourself adopted a strategy which puts a little cash in your hand in exchange for this very problem.
  - fecak 13y ago
    I agree entirely. One of the more interesting challenges of my job is discussing the potential dangers of counteroffer acceptance without sounding like the conversation is self-serving. I very rarely discuss counteroffer now primarily as a matter of integrity, but several years ago I discussed it with every candidate, and often in the first conversation ("have you ever accepted a counter, how do you feel about counters, etc") I do believe that people who accept counters are taking some sort of calculated risk, and it does depend on the company and management. When you've been consulting to a job seeker for some time, get him/her an acceptable offer, and then find out about a counter, it's difficult to remain a credible source. I've recommended to candidates to accept a counter on at least a couple occasions, and I once accepted a counter (and stayed 5 years).
jmspring 13y ago
Honestly, as an employee, if you are looking around and get a good offer, accepting a counter offer from your present company is rarely a good thing. Management clearly didn't plan for raises/growth, expected you to maintain course and be happy. At the point you have already gotten an offer, most management at your present company is not going to look kindly on one's activities... Despite the advice above. There are many factors to "an offer", for some money is important, for others support for built up work habits (odd hours) may be another. That said, I think the initial advice of the article is spot on -- stay engaged with your employees. The last three times I've left a company, it was either a surprise or a shock. Twice bonuses promised were over due, the third, slave pits that founders refused to see (previously commented on).
- bashcoder 13y ago
  I agree, and I also agree with the OP on this issue. Typically, at the point of a counter offer, a line has already been crossed. We've all seen exceptions, but by the time that meeting takes place, the employee has usually left already in their minds and counter offers are typically too little, too late. If, as in your three cases, the employer has clearly failed, then the employee is in a position of strength. They probably don't even want a counter offer, as they are already resolved to leave. If the employer is surprised, it simply further illustrates the problem and validates the decision to leave. From the employer's perspective, if the employee is just trying to leverage better comp opportunistically instead of through merit, it's also unwise to match or beat the offer. In my experience, this only tends to happen with younger, inexperienced people who don't have a long view of their career. Either way, my policy is that when a person leaves, that meeting marks the end of their tenure at the company. Pay them for the two weeks notice they are always willing to give, just as if they were still working, and make all honorable accommodations. But once someone has resolved to leave, it's just better for everyone if they weren't around for an extended farewell tour. This is often very difficult policy for managers, because they fear that a person is indispensable and will require the full notice period to train up replacements. They worry about the disruption to the business that it would cause. But if that's the case, it simply highlights another management failure. I'd rather take the business disruption, which gives my team an opportunity to shine, instead of the cultural disruption of having someone there-but-not-there, anxious to move on.
pekk 13y ago
At the time of a counteroffer, it's reasonable to plan around the possibility that accepting it means being fired shortly after, and maybe followed with a compromised recommendation on back channels. You've made yourself an irritant. It's common for employers in this industry to feel so entitled to your labor that they feel betrayed and hustled, categorize you as an uppity liability, and have to re-establish face with aggressive moves. If asking for a raise isn't enough to get it and you can't offer a specific marginal-value carrot in return, the only leverage you can develop is another offer. But it's too big a stick - you probably aren't just going to get another raise without causing hard feelings and inviting retaliation. You wouldn't try get improvements out of an abusive relationship by letting your SO know you had options. The only way you can build a mutually better deal, including a better salary, is if there is justifiable trust. Employers can earn that trust by fair dealing - like paying fairly well before we both have to deal with nags, demands, and sales pitches. Employers who can't earn their employees' trust have shown failures of leadership and deserve to be walked out on.
- sokoloff 13y ago
  I've been a hiring manager for the better part of the last decade. I cannot imagine any situation where I'd counter an employee's offer while simultaneously plotting to get rid of them down the road. In most cases, I don't even try to counter, as it's usually pointless, but in those cases where I do make a counter-offer, I'm doing it intending to keep them in the fold "permanently" (3+ years, ideally longer).
  - pekk 13y ago
    Depends on the individual (and the tendency varies with the industry). Anyone who responds on HN claims to behave in an ideal way, but if you took this for an indicator of the industry you'd be surprised almost immediately - whether because these claims are often untrue or simply because the people making them are so unrepresentative.
    - sokoloff 13y ago
      Other than pathological or sociopathic management tendencies, I can't see any common scenario when it would make sense to counter while planning to fire. Suppose Abel is working for Manny; Abel gets a better offer and tells Manny. Manny decides to counter. In order for it to make sense for Manny to counter and plan-to-fire Abel, he has to be planning to hire Baker to do Abel's job, but wants to keep Abel around a while for stability and to on-board Baker. That's enormously expensive and risky compared to just paying Abel more in the first place or to just counter-and-keep Abel. If the job is that critical, pay Abel. If it's not that critical, just let the job stay open until you hire Baker. Taking on the severance costs to fire Abel later (and pay higher UE insurance) just to "get back at him" is self-defeating more than it could possibly hurt an employee who has just today proven he could get a higher-paying job. So, where's the "win" for any rational Manny?
jasonlknm 13y ago
My learning as a Fortune 500 VP and a 2x start-up CEO is this: you can do the CounterOffer thing once. Once. Then you are tagged as "loose" and somewhat unreliable. You'll get the $$$. But the next promotion may be impacted. In any event, you can't do it twice. The second time, they let you go.

by GavinB 13y ago

fecak 13y ago

There is a lack of reliable data on counteroffers and their effectiveness due to the secrecy - companies don't have to report to some agency when they counter an employee. Another part of the problem is that recruiters are trained to scare candidates away from accepting counteroffers (I'm a recruiter), and you'll see all kinds of articles from recruiters claiming statistics about what percentage of people who accept counteroffers are gone within a certain amount of time. I've heard 80% within a year, 90% within 6 months - depends on which recruiter you ask, but the numbers seem inflated and are just used as a tool to scare someone from accepting. I distinctly remember being trained on how to handle counteroffers when I was first getting into the business. I don't use any of those tactics these days, but I am certain lots of recruiters do. The amount of publicity that recruiters give to these numbers (which usually lack a source) adds to the misconceptions.

jcdavis 13y ago
I suspect that those (% gone with a year) numbers vary drastically by industry, and may be 80-90% or whatever in some lines of work, but are likely much lower for developers.
- shubb 13y ago
  Maybe a lot of people know that moving job comes with a 10-20% raise, so they take the counter offer while planning to move on in 6 months or so, meaning that they get a double raise... They might also feel they will be taken as a more skilled candidate if they can quote a high current salary, enabling them to score a better role at a better next employer. That might seem counter-intuitive, but if you know you are under market, people selecting employees for quality over price will wonder why.
  - blueskin_ 13y ago
    Definitely plausible. A higher 'most recent salary' means more money in the new job. A counteroffer doesn't change whatever conditions about a job made you leave, be it unfulfilling work, coworkers, a bad environment, long commute, etc. - unless your only concern about the job was being underpaid, which is likely far rarer.
- fecak 13y ago
  Over my 15+ years in recruiting developers I'd say a fairly high number of people stayed much longer after accepting a counter than the most quoted 'stats' would have led me to believe. My only numbers are candidates I lost to counter or admitted accepting a counter in the past, so this isn't a huge sample. The secrecy of counteroffer benefits the company, as if it becomes known that a counter is your quickest means to a raise you can be sure others will follow suit. But that secrecy also has some benefit to the person who accepted a counter, as any potential questions about your loyalty or (in some situations) your perceived willingness to abandon the team during a crunch time won't be exposed and the accepter can continue business as usual to a degree.
  - chris_mahan 13y ago
    Secrecy is the enemy of trust.
GavinB 13y ago
Recruiters certainly have a conflict of interest. It would be pretty straightforward to add a couple questions to any general survey of employees in an industry to figure it out.
- fecak 13y ago
  In the instance of a counteroffer, the recruiter is financially motivated for the person to accept the new job (and decline the counter), regardless of whether or not accepting the counter is a better move for the person. That is one of the most obvious flaws in the way the recruiting business operates, in that there are instances where the job seeker's interests may not align with the recruiter. A couple years ago I posted an article here about an agent system where job seekers were the recruiter's real client (and footing the bills), which would resolve this particular instance of misaligned incentives.
pekk 13y ago
That seems reasonable. There is a lack of reliable data. But citing the ulterior motives of recruiters doesn't establish that it's safe to take counteroffers. There's no reason it can't be both at the same time: recruiters do have ulterior motives, AND it is dangerous to accept a counteroffer. Waving at the badness of recruiters doesn't dismiss the issue. The risk of taking counteroffers isn't unconditional, it depends on the employer. The person evaluating a counteroffer has to consider the trustworthiness of the employer. In the best case, that still includes offering a lower-than-market wage (or how did you easily get a better offer?) While it's true that recruiters' interests often aren't well aligned to the candidate's interests, employers' interests often aren't well aligned to employees' interests either. BUT... in these cases where someone is already desperate enough to be hustling for other offers to push their employer's hand, it's already a lot more likely that the employer's interest is less aligned with the employee than the recruiter's is. Raises come out of profits and many people do take it personally and can't be professional and more importantly, decent about it. If you are facing a counteroffer, you are the person best positioned to evaluate whether your employer is trustworthy - not HN commenters, not a recruiter and certainly not your employer. I can see how people who hire on HN are scared of recruiter memes about counteroffers. A lot of us want to get rich and want shortcuts. Unfortunately, those recruiter memes align with certain realities. There is no shortcut, you (generalized you, not fecak) have to earn the respect of employees as a fair dealer if you want any rational person to want to stay or even consider your counteroffers. If you don't earn that respect, you have no right to complain: you deserve to lose the employees because you yourself adopted a strategy which puts a little cash in your hand in exchange for this very problem.
- fecak 13y ago
  I agree entirely. One of the more interesting challenges of my job is discussing the potential dangers of counteroffer acceptance without sounding like the conversation is self-serving. I very rarely discuss counteroffer now primarily as a matter of integrity, but several years ago I discussed it with every candidate, and often in the first conversation ("have you ever accepted a counter, how do you feel about counters, etc") I do believe that people who accept counters are taking some sort of calculated risk, and it does depend on the company and management. When you've been consulting to a job seeker for some time, get him/her an acceptable offer, and then find out about a counter, it's difficult to remain a credible source. I've recommended to candidates to accept a counter on at least a couple occasions, and I once accepted a counter (and stayed 5 years).

jmspring 13y ago

Honestly, as an employee, if you are looking around and get a good offer, accepting a counter offer from your present company is rarely a good thing. Management clearly didn't plan for raises/growth, expected you to maintain course and be happy. At the point you have already gotten an offer, most management at your present company is not going to look kindly on one's activities... Despite the advice above. There are many factors to "an offer", for some money is important, for others support for built up work habits (odd hours) may be another. That said, I think the initial advice of the article is spot on -- stay engaged with your employees. The last three times I've left a company, it was either a surprise or a shock. Twice bonuses promised were over due, the third, slave pits that founders refused to see (previously commented on).

bashcoder 13y ago
I agree, and I also agree with the OP on this issue. Typically, at the point of a counter offer, a line has already been crossed. We've all seen exceptions, but by the time that meeting takes place, the employee has usually left already in their minds and counter offers are typically too little, too late. If, as in your three cases, the employer has clearly failed, then the employee is in a position of strength. They probably don't even want a counter offer, as they are already resolved to leave. If the employer is surprised, it simply further illustrates the problem and validates the decision to leave. From the employer's perspective, if the employee is just trying to leverage better comp opportunistically instead of through merit, it's also unwise to match or beat the offer. In my experience, this only tends to happen with younger, inexperienced people who don't have a long view of their career. Either way, my policy is that when a person leaves, that meeting marks the end of their tenure at the company. Pay them for the two weeks notice they are always willing to give, just as if they were still working, and make all honorable accommodations. But once someone has resolved to leave, it's just better for everyone if they weren't around for an extended farewell tour. This is often very difficult policy for managers, because they fear that a person is indispensable and will require the full notice period to train up replacements. They worry about the disruption to the business that it would cause. But if that's the case, it simply highlights another management failure. I'd rather take the business disruption, which gives my team an opportunity to shine, instead of the cultural disruption of having someone there-but-not-there, anxious to move on.

pekk 13y ago

At the time of a counteroffer, it's reasonable to plan around the possibility that accepting it means being fired shortly after, and maybe followed with a compromised recommendation on back channels. You've made yourself an irritant. It's common for employers in this industry to feel so entitled to your labor that they feel betrayed and hustled, categorize you as an uppity liability, and have to re-establish face with aggressive moves. If asking for a raise isn't enough to get it and you can't offer a specific marginal-value carrot in return, the only leverage you can develop is another offer. But it's too big a stick - you probably aren't just going to get another raise without causing hard feelings and inviting retaliation. You wouldn't try get improvements out of an abusive relationship by letting your SO know you had options. The only way you can build a mutually better deal, including a better salary, is if there is justifiable trust. Employers can earn that trust by fair dealing - like paying fairly well before we both have to deal with nags, demands, and sales pitches. Employers who can't earn their employees' trust have shown failures of leadership and deserve to be walked out on.

sokoloff 13y ago
I've been a hiring manager for the better part of the last decade. I cannot imagine any situation where I'd counter an employee's offer while simultaneously plotting to get rid of them down the road. In most cases, I don't even try to counter, as it's usually pointless, but in those cases where I do make a counter-offer, I'm doing it intending to keep them in the fold "permanently" (3+ years, ideally longer).
- pekk 13y ago
  Depends on the individual (and the tendency varies with the industry). Anyone who responds on HN claims to behave in an ideal way, but if you took this for an indicator of the industry you'd be surprised almost immediately - whether because these claims are often untrue or simply because the people making them are so unrepresentative.
  - sokoloff 13y ago
    Other than pathological or sociopathic management tendencies, I can't see any common scenario when it would make sense to counter while planning to fire. Suppose Abel is working for Manny; Abel gets a better offer and tells Manny. Manny decides to counter. In order for it to make sense for Manny to counter and plan-to-fire Abel, he has to be planning to hire Baker to do Abel's job, but wants to keep Abel around a while for stability and to on-board Baker. That's enormously expensive and risky compared to just paying Abel more in the first place or to just counter-and-keep Abel. If the job is that critical, pay Abel. If it's not that critical, just let the job stay open until you hire Baker. Taking on the severance costs to fire Abel later (and pay higher UE insurance) just to "get back at him" is self-defeating more than it could possibly hurt an employee who has just today proven he could get a higher-paying job. So, where's the "win" for any rational Manny?

jasonlknm 13y ago

My learning as a Fortune 500 VP and a 2x start-up CEO is this: you can do the CounterOffer thing once. Once. Then you are tagged as "loose" and somewhat unreliable. You'll get the $$$. But the next promotion may be impacted. In any event, you can't do it twice. The second time, they let you go.