Here's a perspective from "an employer" (me) who interviews, hires, and responds sometimes to employees getting an offer from outside.
Employees options/thoughts:
1. You may always be approached at times from other companies with offers. There's nothing wrong with listening, and perhaps receiving, an offer.
2. In fact receiving an offer is a healthy thing for you as it helps to correlate your abilities/value vs. marketplace salaries at that time.
3. Before accepting the offer, you need to weigh ALL the pros and cons of both positions - your current job and the new prospective job.
[red]4. You should decide up front whether you are going to discuss this with your current employer or make the choice independent of them.[/red]
5. If you choose independently of your current employer then stick to that decision and simply resign and be done with it. This is usually the case when you are in a bad position and simply want out.
6. Conversely, you may decide to allow your current employer to weigh in and this would include visiting with them to see how they may respond.
7. If your current employer offers to match or beat the other offer, then you can evaluate both positions and CHOOSE. This should involve more than just consideration of salary.
Current Employer options/thoughts:
1. Realize that ANY employee may get offers like this. Don't take it as disloyalty.
2. If an employee presents their situation and asks for a response, realize that they are giving you the privilege of deciding what to do.
3. You can decide to do nothing, match the offer, beat the offer, and/or alter the employee's status/position/environment.
4. You, as the employer, should realize that most free-market offers like this are...well...free market offers and they actually help you to understand what various types and levels of employees are worth.
5. The other firm's offer may be ridiculously high, and you may very well know your employee is not that valuable and choose to let them go their way.
6. If the employee is a valuable part of your business, you should then review with them all the pros and cons that YOU can think of between the two positions. You are sometimes in a better position to see these pros and cons than the employee.
7. Decide your response to your employee (if they invite one) as to adjustment in salary, change in role/responsibility or promotion.
I totally reject the notion that all employers somehow KNOW exactly what an employee is really worth. In my experience in engineering, keeping up with current wage levels for various engineering levels of experience and abilities is very difficult. NSPE, ACEC and others develop salary surveys but these only really give you a glimpse of what engineers are getting paid and also vary from city to city, state to state.
So the key on the counter offer question is that the employee needs to decide up front whether to even allow that kind of discussion with their current employer. (red item 4 above)
And that decision should also come into play with whether you accept the offer first, or wait to decide, discuss, etc.
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