If a coveted employee gets a new job
offer, a business owner or manager’s
knee-jerk reaction is to counteroffer with more money. But is money the only counteroffer that could entice a worker to stay?
“Employers know all too well that the
cost to replace an exiting employee is very
high, particularly in this very tight job market,” says Kristen Denning, an account
executive with Fort Lauderdale-based
recruiting firm, Spherion Corp. “So it
behooves the employer to find out why the
employee is leaving and bring a counteroffer to the table that is appropriate to what
the employee would like.”
Smart Business spoke with Denning
about ways business owners and managers
can head off potential problems in the
workplace that could cause employees to
leave; and how to make a counteroffer that
an employee will consider.
What is happening in the job market that
makes the subject of counteroffers so timely?
The job market is extremely tight across
the board — but it is particularly acute in
the accounting, finance and information
technology fields. Counteroffers are becoming more commonplace because of the
tight job market and because it costs less
to keep a current worker — even if there is
the added expense of a counteroffer. Because of this current scenario, employers
have to not only approach the employee
with a counteroffer, but they have to be
more creative in attracting and keeping
their good employees.
How are businesses becoming more creative
in retaining their employees?
We are seeing companies finding more
creative ways to increase morale among
their employees, such as office raffles,
giveaways, half-days off, department outings and work-from-home days.
All these techniques can work well to
keep employees happy. However, employers need to also pay more attention to their
work force to see if there is dissatisfaction
brewing and catch it early. Before you have
the situation where an employee leaves because of dissatisfaction, you need to put
in place strategies to make sure that dissatisfaction among workers is addressed …
because if you have one unhappy worker,
chances are you have others.
How can a counteroffer keep an employee
who has already decided to leave?
Bidding wars happen because employees
are looking for higher compensation.
Monetary counteroffers don’t usually happen if an employee is looking for a better
schedule, a change in locale, a better work
environment or more responsibility. Many
employees understand the demand for
workers is high and will test waters to see
what they are worth. What they really
want, in that case, is fair pay.
If employees are happy at their job,
chances are they aren’t looking for a new
job, just better pay — and a counteroffer
from their current employer is probably
what they are seeking. However, if intangibles are not satisfactory — such as work-life balance, opportunity for growth and
advancement in the company, more responsibilities, or less responsibility (if they
are feeling overworked), then chances are
a monetary counteroffer will not keep the
employee.
Can an employer then counteroffer with perks
other than money?
Yes, but it is important to have an honest
discussion with the employee to find out
what they are looking for. Is it a better
schedule? Flexible work hours? Less workload? More responsibility? More money?
More vacation time? It is difficult to make an
appropriate counteroffer unless you know
what is motivating the worker to leave.
Is there reluctance among companies to
make counteroffers?
Yes, there is. One of the reasons is that if
word of a counteroffer gets out, other
employees might get the same idea. A business owner or manager needs to understand that he or she would be setting a
precedent for other workers. Ask yourself:
Should the perk be given to all employees
or be based on seniority or work performance? Get to the root of the issue by finding
out if the problem (such as being overworked) is true for other employees as
well. By doing this, you will head off not
only one employee leaving but perhaps
many more.
Employers must communicate with
workers because if employers can address
problems in the early stages, employees
won’t start looking for another job.
Is a counteroffer ever inappropriate?
When an employee wants to move to
another part of the country to be closer to
family members, there is really nothing an
employer can do to change this situation
and keep the employee.
Companies also should be able to back
up the counteroffer — particularly if they
are promising intangibles, such as a better
work-life balance, or a change in reporting
structure or growth opportunities. If
employers promise it, they need to deliver
it, or they will end up with the same problem down the road.
KRISTEN DENNING is an account executive for Spherion
Corp. based in Fort Lauderdale. Reach her at (813) 864-1111 or
[email protected].
