How to Handle Candidates in the Red Zone: The Danger of the Counteroffer

You have found the perfect candidate. Even better, they have successfully run the gauntlet and passed all the tests. Better still, they have received and accepted an offer. You are home free. Placement made, right?

Think again. The final yards of the recruiting process can be the hardest.

The war for talent today is fiercer than ever. If you love a candidate, chances are the candidate’s current employer loves them, too. When the candidate goes to give their notice, it is possible — even likely — their employer will extend a counteroffer.

Once an offer has been made and accepted it, it is wise to prepare the candidate for the possibility of a counteroffer. In doing so, you help them think through all the ramifications of accepting a counteroffer before they are faced with it. A blindsided candidate may be easily swayed by their employer to accept the counteroffer. By removing the element of surprise, you allow the candidate to make a more careful, more considered decision about what to do if a counteroffer comes along.

Managing Your Candidate’s Expectations About Counteroffers

At first glance, a counteroffer can seem like a great compliment to a candidate, and it is very tempting to accept one. Change can be uncomfortable. For most candidates, it is easier to stay where they are, avoid the adjustment to a new company, and even get a raise out of it!

A candidate may also fear that they may not be as successful at a new company as they are are their current company, making the counteroffer seem even more palatable. Don’t let your candidates sell themselves short!

Here are a few important things to talk about with a candidate before they proceed to give their notice:

1. Ask the candidate to think about why they chose to look for a new position. Negative factors like disorganization, declining culture, a lack of growth opportunities, poor compensation, lack of recognition, or a failing company may have played a role in their decision to enter the job market. Has any of that changed?
2. Companies often view employees who have accepted job offers from other organizations as unengaged or even disloyal. If the candidate takes the counteroffer, they may not be viewed as trustworthy moving forward. This could have serious ramifications for their career at the company.
3. A counteroffer is sometimes a quick fix to bide time while the employer begins looking for a replacement — usually someone who can come in for less money, is not yet jaded, and who didn’t “betray” the organization by entertaining other offers.
4. Ask the candidate bluntly: Why did it take a threat to leave for your current employer to compensate you properly for your hard work?

The key is to remind the candidate to really consider the long-term consequences of accepting a counteroffer. Companies present counteroffers to keep their intellectual property from walking out the door. The counteroffer is about them and what they need, not about the employee.

Remind the candidate that they will be under constant scrutiny if they stay. Time off will be questioned, as managers will wonder if the candidate is out interviewing again. The company may already be searching for a less expensive replacement. After all, the candidate was unhappy enough to consider leaving once. Who’s to say it won’t happen again?

There are countless articles on counteroffers. Almost none of them recommend accepting one. In fact, statistics show that people who do accept counteroffers rarely remain at their workplaces for a significant period of time. Either they quit because the factors that made them want to leave in the first place still make them want to leave, or they are let go because their employer only wanted to keep them around long enough to find a replacement.

As a recruiter, it is your job to take command of the situation. Control the counteroffer proactively so you don’t miss out on closing a deal when you are just inches away from crossing the goal line. Get your candidate thinking about the beneficial aspects of the job they have been offered versus their current job. Share with them the hidden pitfalls of accepting a counteroffer. Your candidate will thank you for providing them with clarity in their moment of doubt.

Allegra Highsmith is the director of recruiting at Goodwin Recruiting.