You’ve spent time and money recruiting for a role but, shortly before the successful candidate is due to start work, you decide to withdraw the offer.
Whilst a withdrawal prior to the start date may seem to be straightforward there are a number of matters that need to be considered to minimise the risks of claims from the individual.
Can a job offer be withdrawn?
Yes, but there are protections for prospective employees that need to be taken into account. If the offer has not been accepted by the individual there are unlikely to be any contractual terms between the parties that need to be considered. If the job offer has been accepted and/or an employment contract provided, then withdrawing the offer will need to take into account the contractual terms in the offer/employment contract.
If an offer is withdrawn for an unlawful discriminatory reason, even where the individual hasn’t accepted the offer or entered in an employment contract, the individual has the protection of the Equality Act and could issue a discrimination claim.
Does notice need to be given and paid?
If the offer has been accepted by the individual and contains a notice period, the employer will usually need to give the employee the period of notice stated in the offer.
On the basis the employee would only have started to earn salary from day one of the employment, the financial losses will usually be limited to any period of notice which falls after the actual start date. For example, if the contract stated a start date of 5 September 2022 and the contract had a four-week notice period and the employer gave notice on 22 August 2022, the employee would be entitled to two week’s pay.
Where the notice period during probation is shorter than the notice period after successful completion of probation the position is more complex, and advice should be sought.
Conditional offers and notice
An employer may have made the employment subject to certain conditions and, if these are set out in the offer letter, the employer won’t need to provide notice if the conditions are not met by the individual.
Common conditions include:
- Evidence of a legal right to work in the UK
- Evidencing the necessary qualifications and/or approvals for the role
- Receipt of satisfactory references
- Being able to perform the new role without breaching any existing restrictions they may have with a previous employer e.g. a non-compete restrictive covenant with a previous employer who is a competitor could mean the individual isn’t able to work for the new employer for several months
- Undergoing a medical examination to ensure they are able to carry out the role
Do you need to provide a reason for the withdrawal of the offer?
There is no legal requirement to provide a reason for the withdrawal and this follows the position that, until an employee has two years’ continuous employment, in most circumstances, they have no right to be told the reason for the termination of their employment. However, it is sometimes better for the prospective employer to provide information to avoid an inference that the termination is due to something else. For example, an individual may think there is a discriminatory reason for the action taken if they aren’t given any details. If there is a genuine and fair reason why the offer is being withdrawn, perhaps there is no longer a requirement for the role, it is preferable to be transparent about the reasons for withdrawal.
For further advice on how to withdraw an offer effectively and any other issues relating to the flexibility of your offers and employment contracts please contact a member of the Employment team.