Complimentary Guide
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One of the most common reasons for having to withdraw a job oer—and
one of the most avoidable—is the discovery of additional information that
changes your assessment of the candidate’s suitability for the position. This can
occur when the results of a reference or credit check is unacceptable or when a
candidate refuses consent to a drug test or sign a noncompete agreement, for
example. By stating on your employment application and in your oer letter
that the job oer is contingent on the successful completion of these tests and
inquiries, you put the candidate on notice that the oer will be withdrawn if
the results are unacceptable.
Another common reason for withdrawing an oer is a change in business
plans that results in the decision not to ll the position. This may be the result
of a nancial downturn, lower demand for the company’s goods and services,
or a change in upper management, for example. The company should be
able to justify the withdrawal of the oer on the basis of a change in business
conditions.
While it is generally legal to withdraw job oers, it is important to pay close
attention to the specic reason for the withdrawal and how the process is
carried out. A candidate whose job oer has been rescinded may sue the
employer on a number of legal theories. The most common are:
1. Promissory estoppel. The candidate made important changes in his
life in reliance on the oer extended by the employer. He may have quit
another job, relocated, or taken other steps to transition to the new job.
When the job oer is rescinded the candidate is left in a worse position
that he was before he received the job oer because he has no job,
home, etc. He may sue the employer to recover his damages incurred in
reliance on the rescinded oer.
2. Fraud. The candidate must show the company knowingly made a
false representation and intended for the candidate to rely on the
misrepresentation. The candidate may sue to recoup damages incurred
by relying on the misrepresentation. For example, an employee submits
his letter of resignation to take another job, but his current employer
makes a counteroer that includes a promotion and large raise. After the
employee turns down the job oer in reliance on the current employer’s
counteroer, the current employer refuses to implement the promised
raise and promotion.
Today, most organizations are
experiencing change, both positive
and negative. Some organizations
are making strategic changes
in their product lines, corporate
directions, or operations.
Most employers nd that from time
to time they are faced with the
need to withdraw a job oer that
has been made to and accepted
by a candidate. Rescinding a job
oer can be an uncomfortable
experience for all involved and can
expose the employer to signicant
legal risk. Therefore, it is wise to
take steps to reduce the likelihood
of having to do so and to do it
right when rescinding an oer is
absolutely necessary.
Rescinding a Job Offer
Can Be Done Carefully