“Counter offer” or “buy back” – these are the dreaded words that any Recruiter will say sends a chill down their spine. You’ve worked with a candidate for probably half a year, managed to find them their ‘dream’ job, and their current employer offers them a £5,000 pay increase and all of a sudden, the candidate is staying put. Not great for the reputation of the recruiter, not great for the new firm who thought they were getting a great candidate starting in three months, but surprisingly you may think, not great for the candidate’s current firm and really not good for the candidate who has decided to stay.
What is buy back?
Let me tell you about a lawyer I worked with a couple of years ago. I will call him Dave for story telling purposes. So Dave came to me asking whether I could find him a new role. He was working at a large regional law firm and enjoyed some aspects of his work, however, he felt pretty undervalued. He explained that he was one of the biggest billers in his department, always over achieved on chargeable hours targets, but he was overlooked for promotion and didn’t seem to be remunerated as well as others in the team who didn’t work as hard. As always, I advised him on the current job market, who of our clients were currently looking in his practice area and the next steps he could consider. Dave actually exclaimed at one point after I mentioned a particular client that he had always wanted to work there and this was also one of the reasons that he had decided to start the job search. Fast forward six months and Dave has been offered his ‘dream’ job. It was with the firm he had told me he loved, it was a slight increase in salary but nothing crazy, although importantly the firm had a clear no smoke and mirrors approach to promotion and bonuses. It was perfect! Dave was so happy to accept the offer.
Dave handed in his notice. This is the time where recruiters are at times sitting at their desks with all fingers crossed, hoping and praying that the counter offer is not going to make the candidate lose sight of their initial reasons for starting their job search. This is the time the recruiter is worried that they may have to make a horrible phone call to their client to let them know they are back to square one.
Dave was counter offered. This, by the way, is becoming ever increasing. Back when I was assisting Dave, counter offers or buy back were not the product of every notice handed in. Unfortunately they are now – I will come onto the reasons and statistics later.
Dave was offered £5,000 more by his employer and a promise of promotion within two years. He was tempted. He was so so tempted by this…. And yes he took the counter offer. He let down the firm he had always wanted to work for, due to money and a promise. Dave stayed for another year, he was overlooked for promotion and ended up joining another smaller firm who, a year previously, did not even make the cut when he decided what firms I should approach on his behalf.
So why am I telling you about Dave? Well it’s a really good example of buy back and the cons (no pros) of accepting a counter offer.
Since the country has started to recover from the recession, buy back has become more and more common. We have seen an increase in volumes of roles we get in each week or even day (last week we had around 30 new jobs in just for the CN South West qualified team), and a decrease in the number of candidates on the market. There are many reasons we are now in a candidate short and job rich market. You may remember back in 2010 (when I myself was trying to secure a training contract) to 2013, law firms were shutting down, stopping training contracts, closing down their property and corporate teams; it was dire. As a result, we have a gap in talent at certain levels. People didn’t qualifying into certain practice areas, if at all. That’s why that now, if I come across a 3 – 5PQE Real Estate lawyer looking for a move, I nearly faint! I know I can probably get that candidate 10 interviews instantaneously. And that’s the problem for employers.
If a law firm lose their 3 – 5PQE Real Estate Associate, they will need to replace them. They will need to cover their work. They will lose a whole fee earner’s income. They will need to use the Partners’ very precious and expensive time to interview new candidates – that’s if they can find any – and on top of that, pay agency fees. It’s a nightmare, and one solved by offering £5,000 or more to the disgruntled employee who now thinks they are actually valued, and everything is ok again.
But it’s not ok again!
Many studies have been carried out on the success of someone accepting a counter offer, and whether they were then ‘happy’ in their job forever more. There are a few different statistics, but the most interesting is 80% of people will be looking or have left their jobs six months after accepting a counter offer. Actually 93% will have left within 18 months. I may as well stop this article now. There’s your answer – counter offers solve nothing! Don’t accept them.
But why? Well imagine you’re Dave: you’ve built up the courage to write your notice, your heart is pounding, you request a meeting with the Partner and you tell him you’re leaving. The Partner is taken aback – he says that he had no idea you weren’t happy. He wishes you had said something sooner. ‘Let me see what I can do’, ‘We can offer more’, ‘Don’t go to the competition’ etc. The Partner calls you into a meeting an hour later. ‘Look, we’ve had a chat and we’d hate to lose you, we’ve realised you’ve been underpaid. Would you accept £5,000 more and a promise of promotion to Senior Associate within two years?’ Yes?
And then you’re really happy? You sit at your desk working the same hours, over achieving on your targets and feeling great because you’re being paid £5,000 more. But then you realise, nothing has changed and it’s awkward as hell. Not only that, you are now possibly not asked to work on the most complex and valuable deals or allowed to client face as much and you are left out of the January pay reviews ‘because you’ve already had a pay rise this year’. Oh. So the firm have decided you’re not to be trusted and a ticking time bomb who could leave at the drop of a hat. The firm have also decided to open up a role to replace you and they win, because they keep you in post fee earning and keeping the status quo, while they try and find someone they perceive is more loyal and keen.
Serious considerations before you decide to change jobs
I will stop being anecdotal now. It’s time for some simple advice. If you are faced with this situation or you’re deciding whether or not to start looking for a new role, please just be aware that this is likely to happen and you need to take into account some considerations:
1. Before deciding to look for a job, really think long and hard about whether you do actually want to leave. Can you imagine handing in your notice? Is it that bad? If the answer is yes, you should start looking.
2. Reasons for leaving – I really don’t like working with any candidates who are looking to leave purely due to money. They are looking to be counter offered. It’s not a cool way of getting a pay rise, all trust is lost with your current employer, and it’s sneaky. If you don’t think you’re getting paid enough – just ask for more! Explain your reasons, tell them you’re upset and disappointed. If it’s deserved and fair, they will more than likely give you a pay rise. If your reasons for leaving are more complex then remember them. Write them down. If they were fixable in the first place, you would have fixed them. Your reasons for leaving are the unfixable reasons. When you get that counter offer, think to yourself, could this extra money make those other problems go away? Will I be happier? Probably not.
I will often speak to candidates just as they have been counter offered who are completely astounded that their company would offer such a rise and think ‘they must value me’. I will remind the candidate of our first conversation and the reasons they explained in great detail as to why they are at breaking point and need to move. I will also point out that it took you to hand in your notice for them to ‘value’ you – why couldn’t they have treated you right in the first place? Why is it when the firm have a gun to their head with the prospect of losing a team member, the effect on the rest of the team, the prospect of having to cover the work and realistically not finding a replacement for at least six months, that they suddenly ‘value’ you so much? Think about it carefully. Remember why it was that you picked up the phone, bothered to draft a CV, researched firms at length and practised your interview technique and answers.
3. Write down the reasons that you accepted the other offer. You got to the stage of accepting the offer – you obviously wanted the role!
4. Don’t burn your bridges – the legal market is small. The South West legal market that I cover is very small! You can really ruin your reputation by messing firms around, using their offers to get your current salary higher, and firms never forget. So if you are looking to get onto the job market and have the prospect of being offered at your favourite firm, don’t let a pesky counter offer ruin your potential future.
5. Speak to your nearest and dearest. Often your closest friends and family will see what your current job is doing to you. They’re the ones who hear you complain every evening about work or can see how stressed you are. I had a candidate recently who was counter offered and actually the offer he received from the new firm was a slight pay cut. Put the two together and it would seem to be stupid not to take the counter offer. However he spoke to his girlfriend. His girlfriend who hardly sees him as he works every evening and most Saturdays. She begged him to take the new role for the sake of their relationship.
6. Remember you’re probably not special! Harsh I know, but everyone is being counter offered. The counter offer isn’t about you, it’s about the firm and their now desperate situation.
And there you have it. Counter offers seem great, flattering and sometimes ridiculous but it doesn’t last. It’s like getting back with an ex – it’s all exciting for the first few weeks, then you start to remember why it was you broke up!
Chadwick Nott has experts in London and all the UK regions. Please contact Kim Lewis in Bristol on 0117 917 1862 / 07919 303942 or firstname.lastname@example.org for information about opportunities in the South West & South Wales.