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It can be frustrating to hear about a counteroffer after you’ve found the perfect candidate, extended an offer, and started planning for employee onboarding. Losing a top candidate at this stage can set you back to square one after you’ve already invested significant time and resources in your recruitment process.
Understanding what motivates candidates to accept counteroffers and implementing strategies to address them can help you improve your offer acceptance rates and reduce time-to-fill.
What is a counteroffer?
A counteroffer is a competitive offer an employer makes after one of their team members receives a job offer elsewhere.
While counteroffers typically involve salary increases, they can also include other offers like:
Why candidates accept counteroffers
Candidates may accept counteroffers for a variety of reasons. Understanding what motivates candidates to accept counteroffers can help you more effectively address them and increase your chances of securing top talent.
Increased compensation
Higher pay is one of the most common and compelling reasons candidates accept counteroffers.
When faced with the prospect of losing a valuable team member, many companies will quickly offer a salary increase that matches or exceeds your offer. This can be particularly attractive as it allows candidates to earn more without the uncertainty of changing employers. After all, compensation is the most important factor candidates consider when looking for a new role.
Addressing immediate concerns
Smart employers use counteroffers to address the specific pain points that led candidates to look elsewhere in the first place. If your candidate complained about their workload, their employer might offer reduced hours or additional support. If work-life balance was the issue, flexible scheduling or remote work options might be offered. And if the candidate is in search of professional growth, they may be offered a promotion.
When a counteroffer directly addresses the primary reasons a candidate was considering leaving, it can be highly effective. Candidates often find it easier to accept these adjustments within their current role than to start fresh somewhere new, even if your opportunity offers similar benefits.
Retaining existing benefits
Candidates nearing important benefit milestones at their current employer may hesitate to leave and forfeit these advantages. Examples include upcoming sabbaticals, cliff vesting dates for stock options, pension qualifications, or special benefits available only to long-term employees.
Additionally, your candidate might have unique benefits that are difficult to match, such as exceptional health insurance coverage, generous paid time off policies, or educational benefits for themselves or family members. The prospect of losing these benefits can make a counteroffer particularly appealing, even if your base compensation is competitive.
Recognition
A counteroffer can make candidates feel valued in ways they perhaps didn’t before receiving an external job offer. The fact that company leadership is making special efforts to retain them can boost morale and job satisfaction, making them reconsider their decision to leave.
This recognition can address a key pain point for candidates whose primary dissatisfaction stemmed from feeling undervalued or overlooked.
Familiarity and comfort
Starting a new job involves numerous changes: new colleagues, different work processes, unfamiliar company culture, and potentially a different commute or work schedule. Staying in a familiar environment with established relationships and routines may be more appealing than embracing these changes.
This familiarity factor can be particularly powerful when combined with an improved compensation package.
Best practices for addressing counteroffers throughout your recruitment process
There are many compelling reasons a candidate might accept a counteroffer, and some will be tough to beat. But there are also many things you can do to better engage candidates and increase your offer acceptance rate.
Align on compensation early in the recruitment process
Compensation misalignment is a common reason candidates reject offers — and it may lead them to accept a counteroffer.
Align compensation early in your recruitment process by sharing a pay range in your job description and discussing pay expectations during initial screening conversations. This approach saves everyone time and reduces the chances of pay dissatisfaction at the offer stage.
Remember that compensation includes more than just base salary. Discuss your complete package, including bonuses, equity, benefits, and perks. Highlighting the total value of your offer can help candidates make more accurate comparisons with their current compensation package or potential counteroffers.
Learn your candidate’s motivations for job searching
Understanding why a candidate is looking for a new role gives you valuable insight into what matters most to them. Ask candidates thoughtful questions about what’s prompting their job search and what they’re looking for in their next position.
Listen carefully to their responses and take notes. Are they seeking better work-life balance? More challenging projects? Career advancement opportunities? Recognition for their contributions? Understanding these motivations helps you tailor your recruitment messaging and offer to address their specific needs.
When a candidate receives a counteroffer, you can remind them why they started looking in the first place. If their current employer is addressing only financial concerns while ignoring other important factors, highlighting this discrepancy can help reinforce the value of your opportunity.
Provide a stellar candidate experience
Job seekers who have a positive candidate experience will be more engaged in your recruitment process and more likely to accept your offer. Focus on creating an experience that makes candidates feel valued and excited about joining your team.
Communicate clearly about your timeline and expectations at each stage. Provide prompt feedback after interviews and respond quickly to questions. Ensure that all interactions reflect your company’s values and culture. Each touchpoint is an opportunity to demonstrate how your organization treats its team members.
Discuss your employer value proposition
Help candidates understand the unique benefits of joining your team by communicating what makes your company, role, and team special. Discuss growth opportunities, meaningful work, and the impact the candidate could make in the role. Share authentic stories about employee experiences and career trajectories within your organization.
Candidates are better equipped to evaluate a counteroffer against the complete package you’re offering when they have a clear understanding of your employer value proposition.
Stay in regular communication with job candidates
Consistent, personalized communication doesn’t just build trust and keep candidates engaged throughout your recruitment process — it can help you learn when a counteroffer is at play.
Check in regularly with updates on their application status, even if you’re still making decisions. Be accessible to answer questions and address concerns as they arise. Share relevant information about your company, such as recent achievements or exciting projects related to their potential role.
Keep up your communication frequency after sending a job offer letter, as this is when candidates are most vulnerable to counteroffers. Send welcome materials, introduce them to team members virtually, and maintain their excitement about joining your team.
Make a verbal offer before extending a written offer
A verbal offer conversation allows you to gauge the candidate’s response, address any concerns immediately, and build enthusiasm before formalizing the details. This approach can help preempt counteroffer considerations.
During this conversation, clearly articulate the complete value proposition, including salary, benefits, growth opportunities, and why you’re excited to have them join your team. Ask directly about their level of interest and what factors might influence their decision to join your team.
This is also a good time to inquire about the likelihood of a counteroffer from their current employer and how they plan to respond. By discussing this possibility openly, you can help the candidate mentally prepare for this scenario and reinforce the reasons your opportunity aligns with their career goals.
Include an expiration date on your offer
Setting a clear timeline for decision-making creates a sense of urgency and reduces the window during which a candidate might receive or consider a counteroffer. This practice also helps you manage your hiring pipeline more effectively.
When extending your offer, clearly communicate the expiration date and explain why you need a response by this deadline. Be reasonable — typically 3-5 business days is sufficient for most positions, though more senior roles might warrant a longer consideration period.
The expiration date shouldn’t come across as pressure tactics but rather as a necessary business practice. Frame it as part of your commitment to an efficient hiring process that respects everyone’s time, including other candidates who may be waiting for a decision.
Remember that it’s not personal
Candidates’ decision-making process involves complex personal and professional factors. Maintain your professionalism and keep the door open for future opportunities if a candidate ultimately accepts a counteroffer.
Consider sending brief candidate surveys to job seekers who decline your offers. Their feedback can provide valuable insights to enhance your recruitment process and better address counteroffer situations in the future.
Be careful about negotiations
Proceed thoughtfully when a candidate uses a counteroffer to negotiate for better terms. It’s important to maintain equity within your team and adhere to your compensation structure.
If you decide to negotiate, be transparent about why you’re making an exception and the factors influencing your decision. Help the candidate understand your compensation philosophy and why internal equity matters to your organization. This context can build trust even if you can’t meet all their requests.
You may also want to consider whether your compensation bands need to be updated across the board in order to be more competitive going forward.
Offer engaging employee onboarding
The period between offer acceptance and the first day of work is critical to increase the chances your new hire shows up, rather than accepting a counteroffer.
Send a warm welcome email as soon as the offer is signed. Include information about what to expect on the first day, introduce key team members, and express enthusiasm about their joining the team. Consider sending company swag or materials that help them feel connected to your organization.
You may also begin the onboarding process before their start date by sharing relevant documentation, setting up systems access, and scheduling initial meetings. These practical steps create momentum and increase the psychological commitment to joining your team.
Final thoughts on addressing counteroffers
Implementing a strategic approach to counteroffers throughout your recruitment process delivers significant benefits for your organization. You can close more of your top-choice candidates by anticipating and addressing the factors that make counteroffers attractive. In doing so, you may also see lower recruitment costs, faster time to fill and increased quality of hire.
Remember that addressing counteroffers isn’t just about reacting when they occur — it’s about creating a recruitment experience so compelling that candidates remain committed to your opportunity even when their current employer attempts to retain them. This proactive approach transforms counteroffers from a frustrating obstacle into a manageable aspect of modern recruitment.
