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I am in a rather delicate situation. I've been working in a startup company for 2 years. My position and environment were very fulfilling but I can't say the same about my salary. After some talks with my boss (and his apathetic reaction), I've decided to end my contract. Wasn't long I found a new position in a high reputation firm. Feeling pretty determined, I signed a contract at the firm, that binds me to start working there in August.

After seeing that I wasn't bluffing, my old boss decided to throw me a counteroffer that includes a higher salary (higher than the new firm's offer) and stock options so that I'd stay. After thinking about it for sometime, I've decided to stay.

How should I approach the new firm for terminating my contract? The problem is, that they might have me bought plane tickets for a business trip. I would also prefer no further negotiations because I've made my mind.

Can someone give me some tips on diplomacy for this situation?

-- Edit

The country I'm from is Lithuania.

Crossfire
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    Be straight up the sooner the better. – John Jun 30 '17 at 07:51
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    Honesty will be the best diplomacy here. – sh5164 Jun 30 '17 at 08:21
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    Just a feed for thought: https://www.forbes.com/forbes/welcome/?toURL=https://www.forbes.com/sites/lisaquast/2014/07/07/why-you-should-never-accept-a-counter-offer-when-you-resign/ – matiit Jun 30 '17 at 09:02
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    I suggest you change your mind again. Do you really want to stay in a company that made this awesome offer only after you quited? What if they fire you 2 months from now? – ypercubeᵀᴹ Jun 30 '17 at 09:46
  • The circumstances are a bit different, but the suggested course of action is perfectly laid out in the approved answer to this question –  Jun 30 '17 at 09:52
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    Is it even allowed to turn down a position AFTER the contract is signed? – Denny Jun 30 '17 at 10:12
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    @Denny at that point it's not "turning down", it's ending the contract. It's not like they can force him to come to work. – Erik Jun 30 '17 at 11:51
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    You didn't actually mention the country. In some countries reneging on a signed contract is a big deal and could get you into trouble (Germany for example). Amount of trouble mostly depends on how annoyed the company is. – gnasher729 Jul 02 '17 at 18:54
  • @gnasher729 I've updated my post with the country. Can you tell me a bit more about your Germany example? Here in Lithuania, signing an non-terminated contract just binds you to a 2 weeks notice before leaving (if no other conditions were stated in the contract). – Crossfire Jul 04 '17 at 09:04
  • @Crossfire: I don't know the details, but if you start a job without having quit your old job, and then give two weeks notice on the first day, that would most likely be seen as breach of contract. Unlike genuinely starting a job, falling out with your manager on the first day, and giving notice. And claiming to start and giving notice on the first day will definitely make the company annoyed. – gnasher729 Jul 04 '17 at 11:01
  • hi @Crossfire it would be great to hear what happened with this!! :) hope it turned out well – Fattie Jul 04 '17 at 13:40

3 Answers3

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It is highly recommended not to accept counter offers. If your company wanted to pay you what you are worth, they should have done so earlier. Accepting the counter offer means you are a marked man. They will replace you as soon as possible. Some people were even fired immediately after rejecting a job offer after accepting a counter offer.

Having signed a new contract just makes it worse. You can always tell the new company jokingly that your boss gave you a higher offer, making clear that you are not accepting it because it is too late. This may increase your perceived value and lead to a better job offer.

gnasher729
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    Having been in a similar position before, I think the blanket answer of "never accept a counter-offer" is too general. If the only reason you're not staying at the company is pay, and they increase your pay, and you are a valuable contributor that they can't replace easily, it makes perfect sense to accept a counter-offer. If your wages are depressed, an employer will not be able to hire someone with similar experience to replace you without spending just as much or more than the cost of the counter-offer, so you're not a marked man. – Egg Jun 30 '17 at 13:23
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    @Egg While your description is certainly a possibility, keep in mind that a company that is about to hire you isn't about to let you go. If so, they simply would opt not to hire you. As a counterpoint, once I accepted a counter offer, making it clear to my boss that I wasn't in the game of jacking up his costs by looking elsewhere; but I had a duty to my family to provide as much for them as I could. I worked at that company for eight years (which is pretty hard to do in software development), until it was sold and closed its doors. – Edwin Buck Jun 30 '17 at 15:06
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    The counter offer mentioned by the OP sounds like desperation rather than appreciation. – camden_kid Jul 03 '17 at 09:37
  • @Egg I don't think it is. Accepting a counteroffer will always leave a bad aftertaste: they had to pay you more to keep you, what if tomorrow you decide that you're worth even more, will you leave again? The situation you're describing is especially bad because the only reason the company can't fire you is that it's too hard to find a replacement for you so there will practically always be resentment from others about that. – Cronax Jul 03 '17 at 15:53
  • This answer has quite a lot of votes considering that it does not answer the question. We already have a Q&A dedicated to discussing whether accepting a counter-offer is a good idea. – Bernhard Barker Oct 28 '17 at 20:58
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Be upfront and honest with them as soon as you can. Hopefully, they haven't bought you the tickets yet (or they are refundable or whatever) as otherwise you're likely to burn that bridge pretty thoroughly. You'll also be giving them more time to continue their recruiting.

For the most part, people should be pretty understanding that you have to do what is best for you but there's always the chance that some companies will take it badly but you can't control their reaction.

Appulus
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motosubatsu
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The answer to your specific question can only be very politely.

Personally, I would say:

"I am very, VERY sorry, but I just received an tremendously higher salary offer from another company. As you can surely understand, it's simply impossible for myself and my family to not accept a tremendously higher salary offer. In short I can only thank you so much for your time and again apologize."

I would not say where you are going (i.e., back to your current employer in this specific QA). That would be really annoying and rubbing salt in the wound.

It's not their business what you're doing and there is no need to get in to it.

ALTERNATELY, use the

standard English business language "changed circumstances".

If New Company decides to drop the OP, OP will get an email

"Due to changed circumstances, we won't be hiring you, as per 13.34.2 of the contract which you signed on Date Date. Faithfully, machine signed."

It is inconceivable the company would mention any company financial details, any reasons whatsoever, or anything else - you'd just get a totally bland legalistic statement.

If OP decides not to go with New Company, OP sends an email

"Due to changed circumstances, unfortunately I won't be proceeding with your offer of Date Date. Kindly, Joe McJones."

Regarding the airfare: just say nothing about it at all. All large businesses can easily chop and change travel arrangements; forget it and don't mention it. It's a drop in the bucket compared to overall recruiting costs.

As everyone has mentioned, unrelated to your specific question, it is very possible that this choice of action will end badly. It is very likely Current Startup will simply discard you in a few months when they can again find someone cheap. Food for thought.

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Fattie
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  • "personal circumstance" isn't a euphemism here, it's a lie. That might come back to bite you in the butt. – Erik Jun 30 '17 at 11:53
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    Hi @Erik, appreciated, but it is not literally a lie. Raising four children is incredibly difficult financially, and the fact that there is now another way forward - to ease the monthly bills - is true. One way to look at it is, OP is actually not now able to relocate to the new city. An outright lie would be a statement such as "My grandmother died and I have to move to Japan." :) Sure, slight variations in wording ("dramatic change in circumstances") may be better or worse depending on the exact situation. Point is, a bland euphemism is often better for all in business. – Fattie Jun 30 '17 at 11:59
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    @Erik, How would you know it's a lie? Maybe your wife/girlfriend has decided not to follow you to your new location and has given you an ultimatum. Maybe your kid ran away because he/she doesn't want to move. Maybe you can't sell/rent your house because an inspection found mold. Or maybe, something else happened. The point is to keep it as vague as possible and to say as little as possible. That's what a company would do if they went back on a contract they signed. – Stephan Branczyk Jul 04 '17 at 09:38
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    When you need to defend it with "it's not literally a lie", you're pretty much on the wrong end already. If you want to be vague, just go with "Due to an unforeseen event", but don't drag family/personal into it, if that didn't factor into it. If you lie, even if it's "not literally a lie", it's something you might need to maintain, and it's usually not worth the hassle. Not to mention that "I accepted a counter-offer" is not in any way "outside of my control", so that part is a blatant lie. – Erik Jul 04 '17 at 10:25
  • Hi @Erik - I really appreciate your point but it is *literally not* a lie. (It's not a case of "it's not quite a lie!" - what I am saying is actually is not a lie and has nothing to do with a lie.) The simplest way to get with what I am saying: if the company decided not to go ahead, the email would simply state "Due to changed circumstances". The standard business language is "change in circumstances", and that's that. – Fattie Jul 04 '17 at 13:30
  • That said, in the spirit of your comment @Erik I removed the flavor of "personal" circumstances. The overwhelming point here is just that "changed circumstances" is the usual business language in both US/UK for such a communication, in both directions. Thanks again. – Fattie Jul 04 '17 at 13:38
  • I think you copied the wrong thing now, you've got some duplication. – Erik Jul 04 '17 at 13:42