Executive Summary C&B should recommend a counteroffer approach that is “fast, justified, and governed.” If the business leader wants to offer far above the salary range, C&B’s role is to (1) validate the rationale and risk, (2) ensure compensation governance and internal equity are addressed, and (3) propose an approved alternative that preserves budget credibility and sets the right precedent—especially for a critical role.

Key Recommendations (what C&B should recommend)

1. Validate urgency and business case (within hours, not days)

• Confirm the employee’s actual offer details: base, variable/bonus, sign-on, benefits, total compensation.
• Assess business impact of losing the employee: revenue/ops risk, delivery timelines, customer commitments, and knowledge criticality.
• Recommend an “expedite” path if required, but only after confirming the facts.

1. Use “total compensation + structure,” not only “base salary”

If they want to go far above range, C&B should recommend using a mix to reduce long-term comp damage, e.g.:

• Sign-on / retention bonus (one-time) tied to stay milestones (e.g., 6/12 months).
• Temporary adjustment or “off-cycle” increase only where policy permits.
• Enhanced variable/role-based allowance instead of permanent base escalation.
• Carefully evaluate whether the employee is already under-market, or whether this is purely a counter-matching play.

1. Enforce governance: justify deviation formally

C&B should recommend a documented deviation case that includes:

• Why the standard range is insufficient (market evidence, role scope change, scarcity, criticality).
• Financial impact and budget source (department cost center, vacancy savings, retention pool, exception budget).
• Precedent control: how this exception will be handled for future similar cases.

1. Set conditions to protect the company (and reduce repeated exceptions)

C&B should recommend safeguards such as:

• Multi-year retention commitment or repayment terms for sign-on (if your policy/legal framework allows).
• Clear performance expectations during the retention period.
• A one-time counteroffer ceiling unless the role’s job level/scope is formally updated.

1. Where deviation is truly necessary: align it to leveling and market benchmarks

• If the employee’s responsibilities have expanded, C&B should recommend reviewing role leveling (not just paying more to “fix” the range).
• Use market benchmarking evidence to support any permanent base adjustment.
• If benchmarking data doesn’t justify the magnitude, push for retention instruments instead.

Business Impact (why this matters)

• Prevents “range collapse” where employees anchor to exceptions.
• Reduces long-term fixed-cost risk (permanent over-range base compounds annually).
• Maintains fairness and strengthens internal equity, supporting engagement and minimizing attrition risk among other high-performers.

Risks (C&B should highlight)

• Internal inequity backlash if others perceive the offer as arbitrary.
• Budget overrun if multiple exceptions follow.
• Compounding effect if the entire increment is built into base instead of structured retention.
• Governance and compliance risk if approvals/policy are skipped (C&B should ensure the right approvals are obtained).

Immediate Next Steps (practical execution)

1. C&B to request within the day:

• Employee current offer and counterparty offer details (base/variable/sign-on), plus employment contract constraints.
• Role scope summary and last job evaluation date/level.
• Business leader’s proposed number and rationale.

1. C&B to propose a recommended counteroffer package:

• Option A (preferred): Market-informed retention bonus + limited base adjustment aligned to policy.
• Option B (if policy and market fully support): Formal off-cycle base correction with documented exception approval.
• Include a 6–12 month stay milestone and repayment/conditions where applicable.

1. C&B to run the governance process:

• Confirm approvals needed (HR leadership, finance, comp committee/exception authority).
• Document rationale, budget source, and precedent controls.

If you need help implementing these recommendations or would like expert guidance tailored to your organization, the team at Zunavish would be happy to assist.