A New Twist On An Old Threat – The Third Party Counteroffer

Aug 1, 2005

While we are all familiar with the standard counteroffer given by a candidate’s current employer, I think less are familiar with the concept of a third-party counteroffer. Recently, I had the opportunity to experience this situation first hand and this column will explain what a third-party counteroffer is and how not to let one derail a potential placement.

I was recently referred an out of state candidate who wanted to relocate to South Florida. The candidate, whom we will call “Paul” was well qualified and had strong family ties to Miami. I was delighted to work with Paul but since I got him “late in the game,” he was already pending at a few quality firms on his own and had received a fair offer from one of them. After Paul interviewed with one of my clients, they decided to extend him an offer which he decided to accept. Delighted for both parties, I was concerned when Paul expressed fear about having to call the other firm to decline the offer. While I knew Paul wanted to join my client based on a variety of different reasons, I realized he could be prone to a third party counteroffer (ie: from the other firm).

In order to minimize this danger to my client, I recommended that Paul send the following emails: 1. an email to my client accepting the position and confirming his start date; 2, an email to the other firm politely but definitively declining their offer; and 3. making a follow-up phone call to the other firm to “close the loop” in a professional manner. In a perfect world, I was not in favor of step 3 but the candidate felt strongly about speaking with the firm to explain his decision based on their extreme interest in him. I shuddered to think what could have happened if only he had called to the other firm first to decline the offer. Based on the quality of the candidate and the demand for his specialty, there was a very good chance that the other firm would have used his turn-down phone call as an opportunity for a counteroffer to get him to join their firm.

While I almost always prepare my candidates for the traditional counteroffer, this situation was unique to me. In addition to the steps outlined above, I also explained to Paul that firms turn down candidates all the time without a second thought and that he did not need to feel guilty about his decision to join another firm just because the other firm was interested in him. I reassured him that whatever his decision was, there was no reason to feel ashamed or hurt that he had to turn the other firm down. By removing some of the emotion from his business decision and reminding him how many firms turn down candidates each day, I was able to defuse the threat of the counteroffer and ensure the placement for my client. In the war for talent, we, as professionals, must always be aware of the unseen dangers of this new enemy- the third-party counteroffer. Good luck!

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