How to handle a counter offer from your current employer

What a counter offer is and why employers make them

A counter offer is a proposal from your current employer, made after you resign or say you have another job offer, to persuade you to stay. It usually means more pay, and sometimes a new title, a promotion, a schedule change or a promise of different work. This guide is about that situation. If you instead want to answer a new employer's job offer with a higher figure, the salary counter offer calculator and the salary negotiation guide cover that side of the table.

Employers make counter offers because replacing someone takes time and effort: the role has to be advertised, candidates interviewed and the new hire trained, while the work waits. The University of Iowa's human resources guidelines describe counter offers as typically used to retain high-level performers in hard-to-recruit or highly specialized positions. A counter offer is a sign that your work is valued, but it is also a business decision about what your leaving would cost.

Some employers counter only when they see proof. The same guidelines say there must be some evidence that an offer was made, usually a written offer, and that a counter offer may not exceed the outside offer unless that offer includes additional recurring pay. Expect to be asked for the offer letter, and decide before the conversation whether you are willing to share it.

Questions to ask before you consider a counter offer

Before you weigh any numbers, go back to why you started looking. Write the reasons down, in order of importance, before you talk to your manager, so the counter offer is judged against them rather than against the relief of not having to change jobs. Then work through these questions honestly.

• Why did it take a resignation for this raise or promotion, and had you asked for it before?
• Does the offer change the reasons you started looking, such as the work itself, your manager, workload, growth or location, or only your pay?
• Is every part of the offer in writing, including the title and the effective date of any raise?
• Is the raise a permanent salary change, or a one-time bonus that leaves your future pay where it was?
• If a promotion is promised, what is the date, what is the title and who makes the decision?
• How will your manager and team treat you once they know you were willing to leave?
• Would you have accepted this package if it had been offered before you started interviewing?

How to compare the counter offer with your new offer

Put both offers side by side on the same terms. Salary is easy to compare; the rest takes more care. The New York State Department of Labor advises thinking about the entire benefit package, not just base salary, and the UCLA Career Center lists factors such as the position, the company, the work environment, co-workers, potential for advancement, and compensation and benefits. The job offer comparison calculator lines up base pay, bonus, equity, retirement match, benefits, time off, commute and hours for two offers.

The same department advises getting an offer in writing before you commit, so there can be no questions about what is included. That applies to a counter offer as much as to a new job: compare the written versions, not what was said in a meeting.

Risks of accepting a counter offer

Accepting a counter offer can work out, especially when pay really was the main problem and the new figure fixes it. The risks come from what does not change, and from the way a resignation changes the relationship with your employer.

These are risks, not certainties. Many figures circulate about how many people who accept a counter offer leave soon afterwards; treat any number without a published source with caution, and judge your situation by your own list of reasons. For a wider checklist on weighing any offer, see how to evaluate a job offer.

• The original problems remain. A raise does not change a difficult manager, a stalled project or work you no longer want to do.
• Trust can shift. Your manager now knows you were willing to leave, which may affect how you are considered for key projects or later promotions.
• Promises may not arrive. A promotion or new responsibilities that exist only in conversation can be delayed or forgotten.
• The raise may be pulled forward. Pay added now may stand in for an increase you would have received at your next review anyway.
• You give up the new role. Turning down the new employer after a long hiring process can close that door, at least for a while.

How to decline a counter offer politely

If you decide to leave, decline promptly and keep the reason short. You do not need to argue about the offer or criticize the company. Thank your manager for the offer and for what you have learned, say that your decision stands and move the conversation to the handover.

Tell your manager in person or on a call first, then confirm in writing. The San José State University Writing Center advises notifying your employer verbally and then with a resignation letter, and calls at least two weeks' notice standard practice, with extra notice for leadership or specialized roles; check your employee handbook or contract for the notice you owe. If you have not written the letter yet, see how to write a resignation letter.

If you decide to accept

If the counter offer fixes the reasons you started looking, accepting it is a legitimate choice. Do it cleanly: get the terms in writing first, then tell the new employer promptly so it can offer the role to another candidate.

If you already accepted the new offer, withdrawing is reneging, and it has real costs. The University of Washington's career center warns that reneging may sacrifice future opportunities with that employer and its recruiters, and that if you signed a contract there may be larger consequences outlined in writing. Read what you signed before you decide; how to decline a job offer has wording for a difficult message like this one.

1. Ask for the counter offer in writing, with the salary, title, effective date and any promised change in duties or promotion timing.
2. Accept in writing and restate the terms you agreed, as the UCLA Career Center advises when accepting any job: title, salary, benefits and dates.
3. Tell the new employer as soon as your decision is final, by phone or email, and thank the people who interviewed you.
4. Agree with your manager on dates for anything promised later, such as a review or a new project, and confirm them by email.

Handling a counter offer without burning bridges

Whichever way you decide, both employers will remember how you handled it. The best protection is not to start a contest you do not intend to finish. Do not resign to get a raise you could have asked for directly, and do not accept a new offer only as leverage; the UCLA Career Center advises against accepting an offer under pressure with the intention of backing out later.

If you want more pay from your current employer, ask before you resign: how to ask for a raise covers making the case. If you are leaving, how to quit a job walks through notice, handover and final pay. More guides on offers, pay and resigning are in the salary and offers hub.

• Keep your resignation between you and your manager until the decision is final; the San José State University Writing Center advises against discussing a plan to quit with co-workers before you give verbal notice.
• Keep both employers informed with short, factual updates rather than leaving either one waiting.
• Do not share the details of one offer with the other employer unless you would be comfortable with them repeating it.
• Whatever you decide, finish your notice period well: a thorough handover is what your manager and colleagues remember.