- Using a competing job offer to negotiate a raise can damage trust with your employer.
- Employers may feel betrayed and view you as a flight risk, limiting future opportunities.
- Negotiating salary at the job offer stage rather than seeking counteroffers later is better.
If you're at the point where you're haggling over price, your relationship with your employer could be all but over. Waving a competing offer at your boss might not end well.
I've been in the business world for over 40 years, even being Microsoft's VP of HR; in my experience, you should not seek or accept a counteroffer. The result could be ugly.
When your employer is forced to make you a counteroffer, the company might feel like they've been held hostage. They might not trust you again. What's to prevent you from going out and getting another offer next month — holding them hostage yet again?
The company will be wary. You won't be trusted with sole ownership of projects — you could be gone. You won't get additional training or opportunities — why invest in someone who can leave so easily?
You won't even get the raises or promotions you might otherwise deserve. Because with those things in short supply, the company might give them to people who aren't at risk of leaving.
You may get your counteroffer, but that's all you'll get. You've clarified that your relationship with the company is purely economic. "Fine," they may say, "we can play that game too."
The delicate trust bond is gone.
The one time to haggle
When you're first negotiating your job offer, discussing compensation — haggling over the price — is fine, even expected. At that time, all points of your employment are open for agreement. You and your future employer are trying to come to reasonable terms, to figure each other out.
It's perfectly reasonable, even encouraged, to push back on the terms of your job offer.
When the salary negotiation time has passed
Once you've been on the job for a while, everything changes. You've established yourself as a competent, even outstanding, employee. Your employer knows you and your work, and the terms of your relationship are stable.
If you get another job offer and approach your employer with it, they'll be caught off guard. They might even be hurt. It doesn't matter if you've previously used your one-on-one time with your manager to clarify your need for more compensation. Threatening to leave changes everything.
You've gone as far as to interview and pursue another job, all the way to the point of a firm offer. For your current employer to feel some sense of betrayal is to be expected.
No, it's not fair
To be clear, the company that's now questioning your loyalty has none for you. At the first sign of a downturn or your struggle with performance, you'd be let go in a heartbeat. Yes, this isn't a fair or equitable relationship, but you likely already knew that.
A delicate balance of trust has been broken. Your employer assumed, even trusted, that you'd continue to work under the existing terms. You've surprised them by being willing to walk away—for what? More money.
Looking for another job means you're willing to move on
Many components make up a job. The work, the people, the culture, the products, the mission, and yes, the compensation. Yet, you've already interviewed and received an offer from another company. That indicates you're willing to move on from the many other components of your current job.
Something besides money is probably also not right where you are. Something money alone can't fix. Even if money is the only reason you're interviewing with other companies, you need to ask yourself why your current company is only willing to offer you the money you deserve when you threaten to leave.
The answer is often depressing. Because they didn't think you were worth it, and they're only offering it now because they're in a bind.
Should you even take a counteroffer?
What I've seen happen next depends on the situation. Often, a company can turn on you, escort you to the door, and remain hurt or insulted. Other times, if your position or the situation is critical, they may try to convince you to stay.
First, they'll try the non-monetary approach. They'll talk about how much you enjoyed the work, your peers, the challenges, the perks, and so on. They might even speak highly of your potential future there.
Beyond that, they'll occasionally try to counteroffer to convince you to stay. They'll match or beat the offer from outside. The question is, should you take it?
Either take the new job or don't
I argue you should never take a counteroffer.
What happens almost always is that you've made your terms clear. You're just at the company for money. As the saying goes, "Not that there's anything wrong with that," but the pretense is all gone. Your relationship with your job is different. It's purely economic.
My advice is, either take another job or don't. Don't expect your employer to counteroffer, they might not. Whatever you do, don't use an outside offer as leverage unless you're 100% willing to take that other job. It may well be the only one you have.
Regardless, even if you get a counteroffer and accept it, the terms of your employment are now completely different. And you might not like that new relationship at all.
Chris Williams is the former VP of HR at Microsoft. He's an executive-level advisor and consultant with over 40 years of experience leading and building teams.