What are the circumstances to retain employees? Well, every manager tries great tactics and works on strategies to ensure employee retention. After all, no one wants to lose their talent to the competition. This is precisely why when managers get an employee’s resignation their first instinct is to do something to make the employee change his mind; opening doors to potential circumstances for retaining that employee.
One of the most common ways to do so is to present them with an employer counteroffer. Managers think they can prevent the employees from leaving the company by offering better employment terms to the employee. However, the truth is that this tactic rarely works in favor of the employee or the employer – and doesn’t lead to retention.
For one, the employee has already made up his mind. The individual has invested his time and effort in looking for newer prospects. And acounteroffer is likely to change the employee’s mind. Furthermore, if you have received an employee resignation, there must be some core issues you aren’t aware of.
Perhaps the employee isn’t satisfied with the work environment or facing similar other issues. Your counteroffer won’t really affect the primary reason that prompted his resignation. Even if a counteroffer manages to make an employee stay in the company, it’s hardly for the long term.
An employer counteroffer does not really prove to be beneficial for the company for long. But does this imply that employer counteroffers are always a bad decision? Not necessarily. There are some circumstances when counteroffers are actually worth a shot.
When Can You Consider Presenting Counteroffers For Employee Retention?
Keep in mind that employees who have decided to leave your company won’t likey budge from their decision, no matter how tempting your counteroffer is. Yes, they might consider staying with a company for a bit longer. But ultimately, you will have to begin the search for a new employee to take on the role and responsibilities left vacant.
But an employer counteroffer isn’t always a waste of time. Let’s take a look at some circumstances where you can actually try to hold onto your employee despite their resignation.
Circumstances To Retain Employees #1: When An Employee Has A Unique Skillset Challenging To Find Elsewhere
Most of the time, we believe that no one is indispensable. And that is definitely true. But some people are better at their jobs than others. And when you get an employee resignation whose skills are highly beneficial for the company, you are forced to consider presenting a counteroffer.
Perhaps you don’t think it would be easy to find a replacement who will have similar skills or information needed for the job. It could be that the transition to a new person will be detrimental to the company. In such a situation, trying hard to ensure employee retention actually makes sense.
Even if your counteroffer makes the employee stay for a little while, you can use the time to find someone who can match their talent. This will ensure that the employee resignation does not hamper the company’s operations in any way.
Circumstances To Retain Employees #2: When Persistent Employee Turnover Poses A Concern to Company Culture
It doesn’t really reflect well on a company if it loses multiple employees within a short time span. This makes fresh talent reluctant to join your business as they feel that perhaps the workplace culture is the problem.
If you wish to reduce the number of employees leaving your company, you have to do something to deal with the constant turnover. And this wouldn’t be possible without coming up with a lucrative employer counteroffer.
Circumstances To Retain Employees #3: When Your Compensation is not Keeping Pace with the Current Market
When too many members of your team express their dissatisfaction with their pay scale, it’s time to introspect. Could it be that you aren’t paying them what they deserve? Do you feel that your best talent isn’t getting market-competitive salary packages?
If that’s the case, you can be sure that you wouldn’t be getting only a couple of employee resignations. Many others will follow suit. Additionally, when you start looking for replacements, you will realize that you will have to pay them a lot more than your current team.
So why not try your hand at employee retention by making a counteroffer that your team actually deserves? If the primary reason for the resignation was indeed low pay, you will have dealt with the problem’s root and won’t have to worry about looking for a replacement anytime soon.
Circumstances To Retain Employees #4: When You The Cost of Turnover is Too High
Hiring and training new people takes time and effort. And can be pretty expensive for the company too. Perhaps your business is going through a tough time.
Or you don’t think it would be feasible for you to deal with the high cost of turnover. In any case, you can make an attempt to prevent your employees from leaving.
This might buy you some time, and you can then decide what to do to handle the cost of turnover effectively and efficiently.
Circumstances To Retain Employees #5: When You’re Concerned about Turnover To Becoming A Trend
Employees resigning could be because of the ample opportunities. Furthermore, people have started prioritizing their mental health above everything else. And if they feel they aren’t satisfied with their workplace, they are quick to part ways.
When one employee resigns, others on the team also start thinking along the same lines. They start wondering if they are missing out on better opportunities. And if it’s really worth it to hold onto their jobs.
Before you know it, what started off as a single employee resignation turns into a chain that can leave your company in shambles. Internal perception matters in a company. You don’t want your team to think they will be better off resigning. And one way to prevent this is by working on your counteroffers.
Circumstances To Retain Employees #6: When Business Continuity Is In Jeopardy
When employees in business operations roles leave, business continuity suffers. This cost of disruption can be significantly greater than what you will have to pay in terms of a counteroffer.
If you feel that employee retention is beneficial for your company and required for smooth functioning, you have to present a counteroffer. This will ensure that business does not suffer and the employee also gets what their needs met.
Circumstances To Retain Employees #7: When You Have A New-Better Fit Role For The Employee
When you get an employee’s resignation, you have to think about what could have prompted them to make this decision. Perhaps they have developed a new skill set and are now dissatisfied with their current position. In this case, you can present a counteroffer where you give them a new role that suits their talent and qualification.
Confused about how this could work? Here’s an example. Let’s say you have an employee who earned an MBA while working for you. Naturally, the individual has upgraded skills and qualifications, and leverage to ask for a raise.. In such a situation, it’s advisable to have a detailed conversation with the employee.
Find out what kind of opportunities the individual is looking for. If you can use the upgraded skills for the benefit of the company, it’s a win-win situation. With your employer’s counteroffer, you can actually come up with a solution that works for both parties.
Circumstances To Retain Employees #8: When You Need Time to Find Another Employee to Fill the Role
Employee retention strategies aren’t always for long-term results. Sometimes, you have to think about the immediate needs of the company too. When employees submits their resignation out of the blue, you are left with little time to come up with a replacement.
Naturally, you would want someone who is capable of handling the responsibilities effectively for the job. But recruiting fresh and reliable talent takes some time. You can use your counteroffer to hold onto the employee for a little longer so that you can find someone who’s perfect for the role.
Employee Retention Using Counteroffers
Employees who do accept counteroffers rarely last with the company beyond a year. And then precedence is set too. Other employees get the message that they can get their demands met by handing in their resignations. Naturally, this isn’t something you would want to encourage.
So if you are thinking about preparing employer counteroffers for an employee, make sure that you have considered all the pros and cons. Decide if retaining this employee is actually worth the risk.
Also read: The 10 Qualities of Successful Interim Project Professionals
