One of your top performers asks to see you and hands you their resignation letter – what do you do? Many employers are tempted to make a counter offer in the hopes it will retain the employee, but this is rarely a successful strategy.
Even if a resigning employee does accept your counter offer, their original motivation for looking for another job can still remain. After all, people are rarely motivated by money alone.
Thirty-six per cent of the 2,752 organisations surveyed in our recently released Hays Salary Guide, representing over 2.6 million employees, said they ‘sometimes’ counter-offer staff when they resign, while just two per cent always do so. Of those counter-offered, on average 46 per cent left anyway, 4 per cent accepted the counter offer but stayed less than three months and 21 per cent stayed between three and 12 months.
Just 29 per cent stayed longer than 12 months.
Counter-offers take one of many forms, from a straight salary increase to additional company benefits, a promotion or new job title, additional responsibilities, a change in role, more involvement in projects that interest the employee or any combination of these.
In today’s market, where confidence is improving, hiring intentions are increasing and candidate turnover is rising, it’s understandable that employers may attempt to reverse an employee’s decision to leave if they have the right skills, cultural fit and are valued.
But this employee has applied for and seriously considered other jobs. They’ve researched other organisations, attended interviews and weighed up their options. Their decision to leave was made at some time during this process when they decided the grass is greener elsewhere.
If you still want to attempt to retain an employee who has resigned, it’s important to talk to them honestly about the reasons they looked for a new role initially. Perhaps it is an issue you can solve, such as by offering new challenges, getting them involved in certain projects or improving their work-life balance.
If however there is no scope to overcome their issues, any counter offer you make – even if it is at first accepted – is unlikely to retain them long term. In the interests of their career and your engagement and productivity levels it might be best to congratulate them on their new role and move on.
Don’t forget your off boarding process and exit interview to ensure their last few weeks run smoothly and positively and they leave feeling valued for the contribution they made. With candidates turning to social media and online reviews to read the comments of former employees, you want all departing staff to leave with their engagement intact, a smile on their face and a willingness to talk positively about their employment experience.
Jim Roy, Regional Director
Level 11, 60 Marcus Clarke Street, Canberra
T (02) 6112 7666
E [email protected]