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One morning, an employee comes in and tells you she’s received an offer from another firm. Should you counteroffer?

Think carefully. A counteroffer can have significant effects on your productivity, your pay scale and your team. Ask yourself these questions before you make the next move.

Are you having a knee-jerk reaction?

It isn’t uncommon for managers to think “Oh, no!” when anyone resigns. There’s going to be a gap on your team for a while and the work will pile up until you hire someone new.

Hiring can take six months or more. You may have to scramble to get hiring authorization, plus it eats up your valuable time. Compensating for the loss will either stretch your current team thin, fall on you or remain undone during the hiring process. A counteroffer may seem the solution to all those issues.

However, you need to assess whether you are afraid of the gap in coverage or whether the person offers significant value. If it’s only the gap that worries you, it may not be wise to counteroffer. Working with a gap during the hiring process can be solved in other ways.

Will it set a precedent you can’t afford?

Most people leave for a higher salary offer, so of course counteroffers usually involve matching or exceeding the new salary. You need to assess whether making a counteroffer will up-end your pay scale.

If the new salary exceeds your pay scale, it may seem to upper management like you need to keep a tighter rein on the purse strings.

On the other hand, you may grapple with the effects of a higher salary precedent on the rest of your staff. Word of a sweetener on salary to keep an employee will travel, and it will travel fast. Employees seeking a higher salary will be encouraged to go on their own job searches, so they can use the offers as leverage.

The net result? You may be dealing with a rash of staffers searching, desiring counteroffers, and either receiving them (with an effect on your pay scale) or leaving.

What impact will it have on your team?

A salary boost for one employee may cause resentment on the part of your other employees. Either she, you, the company or all three could become the focus of gossip and ire.

If your employees feel truly dissatisfied or angry, the counteroffer could affect their work performance and engagement with you and the job.

You also need to think about the bigger picture. People go on job searches for various different reasons. While she may be persuaded to stay with a salary hike, any dissatisfactions with the current job will simply surface later if the reasons were not really salary-related.

If she didn’t like her job duties, or wanted a different corporate culture, you may lose her anyway within a year. Then you’ll be dealing with the same gap you were trying to solve, but with possible resentment by your other staffers thrown in.

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Gainor Staffing can help when you need replacement staffing quickly. We have access to a network of qualified people.