The first formal stage in the employment relationship is generally the making of an offer of employment by the prospective employer. But what happens if, having made the offer, the employer decides that they want to withdraw it? Here are 5 things all employers need to know:
- If you want to withdraw a job offer and no contract of employment has yet been formed, then you do not have to give notice. You can simply notify the applicant that the offer is withdrawn. Whether or not a contract of employment has been formed depends on whether the applicant has accepted the offer and whether any conditions to which the offer was made subject have been met.
- It is possible to make job offers conditional on certain matters being satisfied. Conditions could include the provision of satisfactory references and evidence of right to work. A binding contract is only created once the conditions are satisfied.
- If a contract of employment has been formed, then withdrawing it will amount to a breach of contract. You will need to pay the employee in lieu of any notice period stipulated in the contract in order to avoid a breach of contract claim. To limit the impact of having to pay notice in such circumstances, it is a good idea for the contract to stipulate a short notice period at the start of employment in the probationary period provisions.
- Once an employment contract is formed, automatic unfair dismissal protection applies. The withdrawal of the offer will be a de facto dismissal. If the applicant believes that the job was withdrawn because of a reason such as whistleblowing or pregnancy, to which automatic unfair dismissal rights apply, then the employer could be at risk of an automatic unfair dismissal claim. For this reason, it is important to clearly document the reason for the withdrawal of any job offer.
- Protection from discrimination arises from the point that someone applies for a job with you. It follows that any decision to withdraw a job offer risks an allegation that the withdrawal was in some way discriminatory. This happened in the recent case of Ngole v Touchstone Leeds, when a job offer was withdrawn because of the applicant’s protected belief.
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