Insights

​Counteroffers are becoming more common again, and both employees and employers are feeling the impact.

With talent shortages persisting and retention pressure increasing across many industries, more organisations are turning to counteroffers to keep valued people from leaving. At the same time, employees are navigating highly emotional decisions as they weigh up whether to stay or move on.

But while a counteroffer can seem like a quick solution, it’s often far more complex beneath the surface. Understanding how to handle a counteroffer and whether you should accept one is key to avoiding long-term regret and keeping relationships intact.

This month’s blog breaks down why counteroffers happen, the risks on both sides and how to approach the conversation with clarity.

Why employees accept counteroffers, and why it can backfire

For many employees, deciding whether to accept a counteroffer can be an emotional moment. Higher pay, a renewed sense of recognition or simply the familiarity of staying put can feel reassuring. Fear of change is a powerful motivator, and organisations know this.

But research shows that accepting a counteroffer rarely leads to long-term satisfaction. Most employees who accept a counteroffer are likely to leave within 6 months. That’s because the reasons they began exploring the job market – career progression, cultural challenges, leadership misalignment, workload or lack of development – typically remain in place after the offer is made.

A counteroffer may solve a short-term concern, but it often doesn’t resolve the underlying issues. That’s where regret can set in.

The employer’s dilemma with counteroffers

For employers, making a counteroffer can feel like the simplest way to avoid disruption. Replacing a high-performing team member is costly and time-consuming, especially in a tight labour market. Offering more money or flexibility can seem like the path of least resistance.

However, counteroffers come with risks. They can unintentionally signal inequity to existing team members, particularly if the employee receives improvements that others have been waiting for. They can also undermine trust if people begin to believe that the only way to progress is to resign.

Even more importantly, a counteroffer may simply delay the inevitable. If deeper issues are influencing someone’s decision to leave, there’s a strong chance they will still move on within the year. This leaves the organisation facing the same vacancy later, often at a more difficult moment.

For many employers, the question “Should we counteroffer?” should become “What is the right long-term decision for the business and the individual?”

Handling a counteroffer conversation well

Navigating a counteroffer, whether you’re the employee or the employer, requires clarity, honesty and a pause from the emotion of the moment.

For employees

Before accepting or rejecting a counteroffer, it’s important to assess it objectively:

• Why did I start looking for new opportunities?

• Has the counteroffer genuinely addressed those reasons?

• Would these improvements have been made if I hadn’t resigned?

• Will my choice to stay align with my long-term career goals, or does it just feel safer right now?

Discussing the situation with a neutral adviser or recruiter can help you think beyond the immediate pressure.

For employers

Responding to a resignation is rarely comfortable, but how you handle a counteroffer conversation can influence team culture and future trust. You should consider:

• What has prompted this person to explore other roles?

• Can a counteroffer genuinely resolve those issues?

• Is retention the right long-term decision for both the individual and the team?

• How will this decision be perceived internally?

Responding without resentment or pressure is essential. Even if the team member decides to move on, an open and respectful conversation supports a smoother handover and protects long-term relationships.

How recruitment partners can help

Recruiters play a critical role in counteroffer discussions because they bring a neutral, experience-based perspective. They understand employee motivations and employer pressures, and can help both sides look beyond the emotion of the moment to make decisions that hold up long-term.

A recruitment partner can guide individuals through evaluating whether they should accept a counteroffer, and support employers in understanding what a counteroffer might signal about culture, progression or workload.

Most importantly, they help keep the process fair, transparent and aligned with long-term success, whether the outcome is retention or a respectful transition.

Clarity and communication over quick fixes

Counteroffers will always be part of a competitive job market, especially when great people are hard to find. But they are rarely the tidy solution they appear to be.

For employees, the most sustainable decisions come from understanding what you truly want from your career. For employers, the most effective approach is to build and nurture workplaces in which people feel valued, long before they consider leaving.

Clarity and communication, rather than reactionary fixes, are what keep relationships intact and careers on track, no matter which direction the final decision takes.

If you’re navigating a counteroffer situation or preparing for a critical hiring decision, our team at Becks Wiggins Stokes can support you with practical and impartial advice.

We’re here to help you make the choice that leads to long-term success for you, your team and your organisation. Reach out to our team today at careers@bwsrecruitment.com.au