Should You Counter a Job Offer? A Framework for Deciding
by Andrew Gurman
After deliberating for weeks, my client law firm offered my candidate $170,000 to work in a niche practice area. The candidate lacked experience in that niche but did have solid litigation skills and good credentials. The candidate was excited but wanted more money and therefore requested $10,000 more. The firm did not respond for a few weeks, kept looking, rejected the candidate’s request, and hired someone more junior for less money. The sad thing is that the candidate would have accepted at the original offer level and regretted seeking more money. (I also did not expect the client to respond this way; I otherwise would have recommended that the candidate not request more.)
Although this worst-case scenario is unusual, it’s a cautionary tale for candidates who decide to counter an offer. Many commentators recommend requesting a higher salary because it shows negotiation abilities, that a candidate has an assertive style that will serve them well with the new employer, and that a candidate doesn’t simply yield to others’ requests.
But seeking a higher salary comes with risks. The riskiest outcome is losing the offer altogether, but it can also include alienating your potential future employer and starting off an employment relationship on the wrong foot.
Numerous BigLaw and other law firms have lockstep salary structures. In those cases, there is likely no room for salary negotiation. Your class year typically decides your salary fate. But outside that context, salaries within law firms vary, depending on the unique background and experience of each attorney.
To determine whether to counter an offer, a candidate should evaluate (1) whether it is financially viable, (2) their interest level, (3) who has the leverage, and (4) the fairness of the offer.
Financial Viability
A candidate needs to know the minimum level of compensation they need to live (or live comfortably). Meeting with a certified financial planner (the app Nectarine is a good source to find reasonably priced CFPs) or using an app (such as Monarch, You Need A Budget, or PocketGuard) can be helpful. If the offer does not meet this minimum threshold, then the candidate must counter with a higher offer or simply reject it.
Interest Level
A candidate’s interest level is a core question affecting how much to negotiate. (See https://www.linkedin.com/pulse/breaking-down-gnarly-interview-question-what-your-andrew-gurman-mw4qe for this topic in the context of a question about salary expectations). The greater the interest, the more flexible a candidate should be in accepting the offer as is or negotiating little, and the inverse. In the anecdote above, the candidate was interested but took a gamble by countering. The question is whether the risk is worth it.
Leverage
Understanding who has more leverage is essential to understanding the candidate’s bargaining position. Requesting more compensation is risky when a candidate lacks leverage. Conversely, a candidate with greater leverage has a higher chance of success if they counter an offer.
Let’s look back at the situation above. The candidate clearly lacked leverage: the firm took weeks to extend an offer, which can suggest ambivalence; the candidate had no relevant experience in the practice area; the candidate was relatively senior for the role; and the firm’s need was not urgent.
But sometimes the candidate has significant leverage: they have multiple offers; their experience is spot on; or there is no other candidate in the market who is stronger, and the law firm knows it (as does the candidate).
Fairness of Offer
Determining what constitutes a low, reasonable, or generous offer requires a sense of the market. Market research, including salary surveys, networking, or recruiter insights, can be helpful.
Reasonable or Generous Offer
Let’s assume that the firm offered a salary or compensation package at the high end or even above their stated range, or due diligence shows that the offer is competitive. A candidate should think twice about trying to negotiate. They are dealing with a firm that is tangibly showing their interest in the candidate, and the firm is sending a message that they operate reasonably or even generously.
Countering an offer in this situation may send a message to the employer that the candidate is high maintenance and will be difficult not only in future compensation discussions but in a variety of future negotiations. A reasonable response by an interested candidate is to accept the offer as is and not take the risk of losing it or damaging the relationship from the start.
The “$10,000 Problem”
Joe Ankus, veteran recruiter and one of my mentors, named this concept that arises when a candidate wants $10,000 more than the original offer, and typically when an offer is reasonable or even generous. Even assuming a fair offer, candidates may still seek this bump for a variety of reasons, including the conventional wisdom described above that candidates should always negotiate or because they feel they have significant leverage and can squeeze some additional money out of the employer.
Before seeking the additional $10,000, a candidate should consider whether the extra roughly $6,000-$7,000 after taxes is worth it. It raises the risks noted above associated with counteroffering, especially if an offer is reasonable or generous.
Step back and think long term. Instead of focusing on this additional money now, a candidate can view this extra money considering a long-term relationship with their new employer. In that context, this amount of money may be a drop in the bucket. The focus can instead be on showing their value with their new employer once they begin work and in the months or years to come. Over time, they can benefit from multiples of the $10,000 in terms of bonuses or salary increases based on the value they add.
And what if the attorney shows value to the new employer but the firm does not reciprocate by providing greater compensation? Then the attorney can raise concerns with the firm. If the firm still does not act, they can explore the market and take their talent elsewhere.
If a candidate does decide to seek the extra $10,000, then I recommend making it clear to the employer that they accept the offer with the additional $10,000, rather than needing to ponder the higher amount should the firm increase their offer. It signals that the candidate is serious about joining the firm and makes it easy for the firm simply to say “yes” and close the deal.
Low or “Lowball” Offer
If the law firm instead makes an uncompetitive or extremely low offer, the firm is sending a different message. It could mean that they view the candidate as relatively inexperienced for the role, they are cost conscious (to frame it positively), or they are testing the candidate to see whether they have negotiating skills. If a candidate genuinely is inexperienced but wants the role (and it is financially viable), then negotiating is risky.
But if the candidate’s experience is spot on, then their response depends on their interest level, other options in the market, and whether they are put off by the offer. If they are comfortable with the employer’s bargaining style and willing to walk away should the employer balk, then this can be a good time to make a counteroffer. It may be hard to tell, but if the candidate senses that the employer would settle somewhere in the middle, then they can propose a much higher offer. Alternatively, they can make a more modest counteroffer with which they would be comfortable.
Decision Checklist
Before you counter, ask yourself the following:
- Is this financially viable?
- How interested am I in this specific role?
- Do I have leverage?
- Is the offer already reasonable or generous?
Have you ever countered a job offer—or regretted it? How do you decide when to negotiate?