iGaming Business magazine iGB 112 Sept/Oct 2018 | Page 101

People
COUNTER OFFERS:
PAYING A PREMIUM
TO PREVENT DEPARTURES
Talent scarcity is driving up demand but candidates seeking the ‘bargaining chip’ of an offer
from elsewhere are playing a risky game, says Pentasia managing director Alastair Cleland
Alastair Cleland is managing director of
Pentasia Recruitment Group, a specialist igaming
recruitment agency. With 23 years’ experience
managing large and multi-location agencies,
Alastair has a track record of delivering hard-to-
reach candidates for growing companies.
Losing staff is a huge cost for any organisation to bear. A departing
member of staff is generally judged to cost the business twice his or her
annual salary, all considered.
Comparatively, a conciliatory pay rise to maintain the status quo
presents exceptional value for money.
In igaming’s most talent-short specialist areas, the cost of lost staff is
often even more significant and many businesses are fighting harder
than ever to retain key personnel.
Counter offers are increasingly prevalent in the highest-demand
talent areas, such as casino and gaming product specialists; experienced
legal and compliance practitioners; and, following Malta Gaming
Authority’s regulatory changes, tech specialists (in particular C++, Java,
Python and other back-end).
At Pentasia we now expect around 50% of all candidates to be
counter-offered, and an even higher percentage of the most specialist
and senior talent.
Yet, counter offers usually only provide a temporary fix. Candidates
who accept counter offers generally return to the job market within
the year, for the very same reasons they initially sought to leave: a new
challenge, a growth opportunity, a lifestyle change.
Money still talks when the offer is substantial, of course. In the
past year we’ve regularly come across counter offers of a 30%
increase in salary or more, plus offers including equity and
additional benefits.
On the whole, though, it’s only those employers that are prepared to
substantially improve the job itself, rather than the salary, whose counter
offers succeed long term.
Risks of playing the game
Candidates, aware of the ‘bargaining chip’ value of an offer from
elsewhere, can see counter offers as a fast-track to salary increases.
In recent months we’ve seen how this can be a risky game for
individuals, often with serious drawbacks that can outweigh the
potential win.
First, hiring employers are increasingly cautious of applicants’
motives, and wary of those not wholly committed to moving. Those
judged to be playing games will receive no offer and instead waste both
their time and, in the longer term, their reputation.
Second, current employers are increasingly wise to counter-offer
tactics. A larger company’s response can be measured, with counter
offers coming in under the competing employer’s package and, crucially,
HR noting the disloyalty. Even in candidate-short markets, power rests
with the big players.
Ultimately, it’s ambition on the candidate side and opportunity on the
client side that creates a strong employer-employee relationship.
This match – rather than short-term salary increases – is where
we recommend all employment negotiations be focused for the best
outcome all-round.
Key trends
• In 2018, reasons for leaving have generally centred on either
career growth or lifestyle benefits such as flexible hours or remote
working. Employers who can provide both are far less susceptible to
staff departures.
• Big-name employers, particularly in tight markets like Malta, know
that newer rivals will outbid them for talent. However, they rarely
match these inflated offers, aware of their value to staff in terms of
additional employment benefits and long-term opportunity.
• Start-ups and smaller competitors find most success using job titles
and responsibility to attract talent away from the big players. Titles like
“director of…” and team leadership, combined with a healthy salary boost,
are often difficult for large employers to match due to internal structures.
• Emotional attachment – far more than money motive – is the primary
reason that candidates accept counter offers (or a lack of willingness to
leave in the first instance.) The power of loyalty, staff engagement and
team unity cannot be underestimated.
• Genuinely active candidates, looking to move on from a successful
company and role, regularly receive at least four of five offers of
employment. Hirers should therefore consider not only the counter
offer, but also offers from competing employers, when considering
their bid.
i GamingBusiness | Issue 112 | September/October 2018
97