On Counter Offers
jasonpunyon.github.com
jasonpunyon.github.com
Counteroffers are a fact of daily life with most corporations, there's nothing malicious nor personal about them. A ludicrous counter-offer means the company has severe managerial issues and has allowed someone to become absolutely, non-negotiably indispensable.
IMO perceiving the counteroffer as "buying off his dreams" is a huge overreaction, and in my various jobs has never been a malicious move. Your boss is trying to save his bacon, not destroy your dreams.
The author does nail one point, but for the wrong reasons:
> "So some of these offers are just plain “keep them in the building while we find a replacement who’ll do the job at the price we were paying.”"
That's exactly what these counteroffers are. Very few counteroffers are serious counteroffers (serious as in they will keep you on indefinitely at the new salary). Management is going "oh fuck, how did we let this guy become so critical" right now, and as soon as the immediate crisis of you leaving is gone, they will attempt to replace you. You'll be out on your ass as soon as they find/train that someone.
I've had this exact thing confirmed by multiple HR folks I've known, all off the record of course. They admit that they explicitly get asked by management to organize a "manage-out". Hell, this sort of thing is bog-standard for most large HR departments.
> " Companies don’t just allow their managers to get slapped around and make outrageous counter offers to people. Budgets and HR minions can’t stand that. The manager gets dinged by the higher ups because she’s “lost control”."
This seems like where the author is off the mark. In my experience no HR person nor upper-management exec has to chase your boss down to push you out. Your boss already has every intention to manage you out as soon as he drops the counteroffer on the table. Especially when the offer is 2x your salary.
I'm heading for a situation that will most definitely result in a counter-offer and my thoughts were to ask for an employment contract to lock in my time and terms so I don't get backstabbed a few months later. But my problem was how to generate and finish the contract before losing one (or both) jobs.
Severance seems a lot easier to get in place and locked in. Does anyone else have experience with this?
Hell, I bet most of these don't even get honoured. "You understand, we need to get budget, some bureaucracy, but don't you worry, we'll sort it out asap!"... weeks pass, the new money is not coming ("eh, we had some problems, but don't you worry..."), and eventually you get kicked out. Meanwhile, your original offer has probably expired.
Never accept counter-offers.
And to avoid the situation described in the first paragraph, you get the counteroffer in writing, of course. I know people that ended up doing 2 to 3 iterations of counteroffers. It worked out fine for them.
To clarify, by "expiring" I mean the company finding another suitable candidate.
A ludicrous counter-offer means the company has severe managerial issues and has allowed someone to become absolutely, non-negotiably indispensable.
I don't think it's always managerial issues. Sometimes people are just, well, good.
There is a problem underlying this -- as a result of this managerial "flight risk", many companies in turn decide to regard their employees to be replaceable parts. So they get obsessed with CMM, over-the-top documentation and 'repeatable processes'.
Sometimes someone is indispensable (rarely truly indispensable) because you've let knowledge pool in one person; where is shouldn't. Sometimes it's because your employee is a superstar. It's really important to recognise the difference.
Most of the time companies will assign this person to train others. Works some of the time, except when they're a superstar, in which case it just accelerates their exit.
Is it possible to negotiate a contract for the time period in which they will pay you the new salary and a renewed contract for the old (or higher but reasonable) salary? So you know how long you can stick around and get 2X the money if you want to, and the renewed contract tells you whether they intend on getting rid if you. (I don't have any experience with this, so I'd love to hear others thoughts)
I hand in my letter of resignation, boss thinks it over for a bit before offering me a 30% raise. I respectfully decline and start to leave before she doubles the raise.
This is where I had to think about it - I wasn't leaving for my dream job or anything, just another 9-5, and here I was with 4x the difference on the table. I said if she could have me a 3-year employment contract by the end of the day I'd sign it at the agreed salary, which is when she immediately started hedging about needing to talk to the attorneys and the owners, etc.
TL;DR - Counter offers are bunk.
Is it possible to present your own contract and say "have your lawyers look this over and give me an answer in 48 hours"?
"Oh, you have a counter offer? I thought you might! I just so happen to have this legally binding contract here..."
The idea of the contract was that I could stand being in my current position as long as the comp was better. But this course of events would just lead to a lot more downstream pain than expected.
Higher up in this chain there was the mention of asking for a severance package, which seems way more easier to mention off the cuff and not look like a premeditated f-you move.
Financial considerations are a significant part of a lot of peoples' reasons for working where they do. Some may even use job offers as bargaining tactics. If you were working at a hedge fund, obviously finances are at least part of your motive. So perhaps your boss merely sought to play to that.
The only reason to make a counter offer is because at least one of the (major) reasons an employee is leaving is money (and that's basically never the reason). People leave because it's not a fit. Money isn't going to make it a fit, so as a manager giving a counter-offer, if you know what you're doing.. you're buying time. Hoping the employee will take the offer and you'll figure out how to make them less important to you over the next N months. That's skeezy. Otherwise you don't know any better. You're a shitty manager and you're out of touch. It doesn't occur to you that you already have a team where your best is leaving, and now you'll spend the next N months making your best even more bummed out and less productive (especially since they're suddenly in the position of realizing how much leverage they have with you).
The whole thing is sad and terrible. If you're a manager and this happens, let it. Then turn around and figure out what your remaining employees need to be happy and fulfilled.
But yet, for many people, it does. In the grand scheme of all programmers (or any profession, for that matter), only a minority are doing it for the sheer passion of it. Most people are in it for the paycheck, and if they can get a larger paycheck without taking a substantially worse job... That's a sweet deal.
Everyone is working for passion/happiness. There's the net awesome that you get out of solving problems and building value at worth, and there's the net awesome that you buy with the money they pay you.
One way to look at it is that it all goes in the same pool and plusses-and-minuses until you have some score of how awesome your days tend to be.
I think that's the only reasonable way to look at it, and I don't buy the 'some of us are just working stiffs' bit that gets dropped into these threads on HN. I think more accurately, it's just generally speaking really hard to find an awesome job and eating and sleeping (under drywall) is expensive... So for lots of folks salary dwarfs work environment in priority.
The sad thing is that the comparison is generally done in a speculative vacuum. It's very easy to imagine what would happen if we made less (or more) money. That's pretty simple math. It's much harder to evaluate the benefits or drawbacks of a different work environment on our lives. Challenging math.
Oh, and that was a total tangent... to the point, in my example the employee is leaving for reasons other than money. So the premise kind of is the conclusion there. I was just being redundant. It's just a logical redundancy that lots of people in this situation seem to miss. Dollars do that.
By "everyone" you clearly can't possibly mean "everyone."
Maybe they are skeezy jerks, I dunno. Those kinds of people do exist in the world, but it's pretty tacky flaming them in public.
Fuck no. Nice try. They didn't value his presence at their company. They valued the reversal of his decision to depart.
If they valued his presence they would have been paying him what they thought he was worth (or maybe even considered other factors that made them so different from the new gig in his mind).
The only time I'll consider a counter offer is if 1) the engineer really is good and 2) they don't really want to leave. It's a judgement call and I've only chased somebody once (successfully, I might add).
This isn't necessarily true. You can get headhunted and receive offers for similar jobs at significantly higher pay. In these cases counter-offers make perfect sense for both sides.
To assuage these feelings of guilt, people start identifying and magnifying things that would never have bothered them otherwise (such as "why does management only value me when I threaten to quit?"). Once those seeds are planted, it is a steady progression towards exit from the company. I'd rather the engineer take the new job and find somebody who is excited about my opportunity.
There are no absolutes in management, though. Like I said, I have chased somebody back into the company who was in his last days with an accepted offer elsewhere.
The real key is to make it so your toxic employees want to leave and your fertile employees have no desire to answer te headhunter call.
Personally I don't feel that they meant any disrespect. They're just desperate to keep you longer. It is hard to find good developers.
While it's true that they're desperate to keep him longer, it's because they're trying to stall, not because they think its a good developer.
At some of the past places I've worked, the best raise you can get is 10%.
> While it's true that they're desperate to keep him longer, it's because they're trying to stall
This is most likely true.
Based on the anger in his post, I'm guessing the real wrong was done in the past. It didn't seem like he was treated well. I still don't see the counter offer as bad. If anything it's flattering.
quoting: ``Here we find the manager striving to achieve his goal by eliminating opportunities, contracting his set of alternatives, although discussions of bargaining often rule this out axiomatically. [...] The resolution of the paradox is that the manager, by his tactic of "tying one hand behind him" hopes for a favorable effect on his employee's expectations.``
from The Theory and Practice of Blackmail by Daniel Ellsberg (http://www.rand.org/content/dam/rand/pubs/papers/2005/P3883....), I swapped blackmailer/manager and victim/employee. The document is a really insightful take on negotiation I think except for the fact the it used the loaded terms blackmailer/victim.
There are plenty of organizations which are unable to recognize and/or reward high performance, and plenty of organizations which create compensation plans as if employees were fungible with infinite supply at their set salaries, and then depend on the psychological comfort of certainty and corresponding fear of the unknown to retain the workers, so although it isn't rare or even uncommon, that might be the sort of thing that made him angry.
I agreed to stay for four months more. I knew a 2X raise couldn't win against my psyche forever. But it was nice to finally get that formal sign of acknowledgment.
(Former signs of acknowledgment - aka monetary bonuses - sat in my direct manager's desk. He never felt the need to pass it on until it became apparent to myself and the person who directed it that I had not yet received it.)
I don't know about the skeeziness of the writer's boss, but my mine sure was!
Also consider that there are companies that are always hiring developers. They aren't filling roles, they are just looking to hire anyone capable that they can. Of course their demand is actually finite but reaching it in the current market is inconceivable. These companies can afford to pay whatever value you add, salary is dictated only by their demand for good engineers because it dwarfs the supply. Good engineers aren't actually replaceable for these companies, if they could find a replacement they would want to retain both.
Counter offers never work out in the long term. Now that you've put in your notice, you're no longer seen as loyal. Therefore, had you accepted (bad idea) they would not have kept you around any longer than absolutely necessary.
Even so, trashing your former employer after they offer you more money, however self-serving, is bad business.
I would not hire somebody if I saw them bad mouthing a former employer. What if they don't like my company? When they leave, they're going blast my business for not recognizing their genius/value/divinity earlier? Not good.
According to that CV, the employer was Bigger Hedge Fund.
Kinda a funny coincidence that there's another person with the same name on LinkedIn who also recently quit a programming job at an investment management firm and lives in the NYC area. Anyways, the fact that he links directly to his CV makes it even less anonymous who he's talking about.
To me, this is like me saying "I've met some pretty awful people..." and you saying "How dare you talk about my sister like that!"
Publicly (or to their face) calling a former employer "sleazy" is very, very unprofessional. It demonstrates poor taste and lack of restraint. And ultimately, self-importance.
"How dare they not recognize that their pathetic company is NOT my dream job? How dare they offer me money to continue to support their petty operation?"
Are you people even serious in defending this?
In my own experience, I've gotten a large "retention bonus" after many of my peers quit. However, this was just dropped on me without any request or action on my part. It was a preemptive "oh God please stay at least until date X", but I didn't have anything to do with causing it directly. It was just smart/panicked managers buying insurance. And it worked. I happily stayed as I wasn't quite to the point of being ready to leave yet, so I stayed till that date and then through the next end of year bonus and then gave notice Jan 2.
I'm a freelancer, and over the last couple of years I've transitioned over several positions. It is much easier to negotiate a new salary when you have a job offer in hand, though I've never taken a counter offer.
It helps to know that there is usually a large-ish cost in acquiring a new hire that most folks want to avoid... and that just because you have a job offer from someone else you don't necessarily have to take it.
The last two clients I worked with were quite flattered when I asked for a counter offer, though because a) I'm still kind of new as a developer and b) it's my second career neither of these folks were paying half what my new offer was neither could really match the newer offer.
Perhaps it would be different if I were a w2 employee (and I believe that I only have one or two more transitions to make before I top out at what I can effectively earn, though I am quite good at what I do).... but having a job offer in hand doesn't mean that you can't or shouldn't specifically ask your current employers to make a counter offer.
It sounds silly. It sounds paranoid. It sounds like something out of a cheap novel. But I have done research for an executive recruiter for over two years as a side job, and the statistic he quotes me is this: "Within 6 months the person who accepts a counter-offer is gone."
The reasons are many for why that is. It's not always the sleaze bag just trying to buy uninterrupted productivity. Often, the person is like the original writer said: absolutely miserable.
Regardless never accept counter offers. Ever.
I think you should understand yourself in this way and you will see that there are also a lot of options for you.
I mean, if you are good enough, that Joel wants to hire you and your old boss offers you 2 times your old salary (I never even heard about such an offer), you must be good enough that most companies want you. So you can still work for Joel later on. You might also be able to work for Google or Facebook (applying would be worth find out about that, wouldn't it?). You can tell your old boss your requirements for your dreamjob and you can ask Joel for the same number on your first paycheck.
My point is, you don't have two options: "money" or "dream". You have a wide range between them and can find out how much you can get of both. Be more flexible, Jason!
On even a higher level, economics just describes possible outcomes of a game under a set of rules. It does not prevent us from using our own judgement of fairness on the rules themselves.
If company A is willing to pay you $100k/year, and you won't work for less than $120k/year, what's your market value?
Maybe you wait a few weeks and get an offer from company B for $140k, and you negotiate it up to $160k. The manager was willing to pay $180. Meanwhile, company C wants you for $200k, but you never sent them your résumé.
What's your market value?
(You have poor liquidity, so it's hard to figure out what your actual market value is. Market value is the estimated salary you'd actually get after a negotiation, which is usually going to be above your minimum salary and below the maximum offer. Your actual salary is only one more piece of data you can use to figure out what your actual market value is.)
On the other hand, I'd be more insulted that they think I'm actually worth 2x what they are paying me now, but weren't.
Ultimately, I think you did just fine following your dreams. Good luck! :-)
Also, you should always negotiate when you get a job offer. Remember the employer has tons of expenses to have you there and a few thousand more per year is relatively little to them, but significant to you, the worst they can tell you is that's the best they can offer. Any employer that would take offense at an attempt to negotiate is not worth working for.
if you accept such an offer to stay, the company knows it is about money, and that you are a flight risk because as soon as a better job comes along you will be gone. the funny thing is, most everyone would leave for a better job, but by going through this back and forth you will now have a target on you (company now realizes how critcal you are to the busness and will work harder to cross train)
I have seen this from both sides, and the author made the correct decision to walk in my opinion.
if some project needs finishing, negotiate a part time contractor stint, if you feel really really nice.
The only way you should consider a counter offer is if it really addresses the reasons you're looking to leave and you really believe that they'll deliver on it.
I have moved in the past for more money - and I have never been worried about finding another job. I also have a huge history/legacy in the past company. I would have gladly stayed if they gave 2x. The catch was that they were already paying through their nose and they didn't have the headroom without promoting me levels. It happens.