You have found the right person. They accepted your offer and resigned. Three weeks into the notice period, they call to say their current employer has offered more money, a promotion or a new project to stay. With long notice periods in India, this happens often. What you do in the next day or two matters, and what you did two months earlier matters more.
Why employers make counter-offers
Replacing a good employee is slow and costly, and the notice period gives the current employer weeks to try. For them, a pay rise is cheaper than a search. Many companies only find out what a person is worth to them on the day that person resigns.
Why candidates accept
It is easy to assume it is about money. It often is not.
- Staying is comfortable. The candidate knows the people, the work and the commute. Your company is a risk they have only read about.
- They feel valued, suddenly. A senior leader they have barely met takes them to lunch and says the right things.
- They feel guilty. The manager says the team will suffer, and it is partly true.
- The original problem appears to be solved. If they were leaving for pay or a title, and the counter-offer delivers it, the reason to move has gone.
The last point is the important one. Whether a counter-offer works depends on why the person wanted to leave.
Find the real reason early
In the first conversations, long before any offer, ask the candidate why they are looking. Then ask again, gently, because the first answer is usually the polite one.
- “What would have to change for you to stay where you are?”
- “Have you spoken to your manager about it? What happened?”
- “If your company matched our offer, what would you do?”
The answers tell you how exposed you are. A person leaving because of the work, the manager, the lack of growth or the direction of the company is hard to counter. More money does not change the manager. A person leaving only for pay can be bought back with pay.
It is fair to ask the last question directly. Most candidates answer honestly, and thinking it through once in advance makes them steadier when the moment comes.
Before they resign
Prepare the candidate. Tell them plainly that a counter-offer is likely and ask how they will handle it. Suggest they decide now, while calm, what they would say.
Make sure the offer is complete and in writing before they resign: pay, role, reporting line, start date, anything agreed in conversation. A candidate holding a vague offer is easy to persuade back.
When the counter-offer arrives
Respond the same day. Silence is read as indifference. The hiring manager should make the call, not HR alone. This is a conversation between the two people who will work together.
Listen first. Ask what was offered and how they feel about it. Do not criticise their employer. They may still stay, and they will remember what you said.
Go back to their reasons. “When we first spoke, you told me you were leaving because you wanted to lead a team and there was no room for that. Has that changed?” Often it has not, and the candidate hears it as they say it.
Ask a fair question: “Why did it take your resignation for this to be offered?” You are not trying to trap anyone. It is the question they are already asking themselves.
Remind them of what they chose. The work, the team they met, what they said they were looking forward to. Offer another conversation with a future colleague if it would help.
Should you raise your offer?
Sometimes a small adjustment is reasonable, if your offer was at the low end of your band and the person is clearly worth it. Be careful about a bidding war. If the decision is being made on money alone, you may win this round and lose the person the same way a year later. And your existing team will learn what the new person was paid.
Decide your limit before you make the call, and say it once.
If they stay
Accept it well. Thank them for telling you directly, wish them well and leave the door open. Their reasons for looking may return in six months, and people remember who behaved decently.
Then call your second-choice candidate that day. This is why you should never tell the others they were unsuccessful until your first choice has joined, or at least until their resignation has been accepted and a last working day confirmed.
The best protection
Three things reduce counter-offer losses more than any negotiation: understanding the real reason for leaving at the start, a complete written offer before resignation, and regular contact through the notice period. A candidate who feels they have already joined your team is much harder to persuade to stay behind.
