Counter offer

A counter offer occurs when an employer responds to an employee's resignation by offering improved compensation, a new title, or other changes to retain the employee. Accepting counter offers is statistically unwise for employees: research consistently shows that 50 to 80 percent of employees who accept counter offers leave within 12 months — because the underlying reasons for wanting to leave (career growth, management quality, culture, or strategic concerns about the organization) are rarely addressed by a compensation adjustment. For employers, counter offers address only the most visible attrition signal without addressing the underlying cause, and they signal to the employee that the organization required a resignation threat to deliver what should have been proactively managed. HR teams that track counter offer acceptance rates and subsequent retention provide valuable data on whether the practice creates net value or primarily delays inevitable departures.