8 things you need to know about rescinded job offers

It is rare for an employer to rescind a job offer, but it does happen. Here, two legal experts share what you need to know to reduce the risk that it will happen to you … and what to do if it does.

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Executives can ask for an acceptable amount of severance should the job be revoked prior to starting or should it go away during some number of months provided they are not terminated for cause, Moore says.

“People can try to negotiate some of those things like signing bonuses and relocation costs if in fact they feel the offer is a high risk [of being rescinded]. There are some employers who realize it is high risk in these economic times, and because they need certain employees, they're willing to take on some of that risk,” she says.

Actions you can take if an offer is rescinded

If the offer is rescinded ‘for cause,’ then there’s not much you can do except learn from your mistakes, Rampenthal says. There’s also not much you can do about economic downturn or other issues outside of a candidate’s control. In those cases, you’re better off expending your energy continuing your job search than tilting at windmills and trying to get redress from the company, he says.

“In some cases, it’s better to just get over it and move on. Yeah, it sucks and it’s a punch in the gut, but it’s like getting a breakup text or hearing other bad news,” Rampenthal says. “You don’t want to do anything rash, so calm down and think carefully about your response. Look and see what has changed: was there a condition that wasn’t met? Then there’s your answer,” he says.

But if you turned down other offers, purchased equipment, moved your family in reliance on that offer, he adds, then there’s a good chance you are entitled to redress. The problem is, it can be difficult to prove, says Moore.

“There is a claim people can make for what's called ‘detrimental reliance’ or ‘negligent representation,’” she says. “The concept is that the employee relies, to their detriment, on a job offer. They move across the country or quit a job in reliance on an offer made by a company. People have over the years made that kind of a claim to sue for damages as a result,” Moore says. But courts have been reluctant to enforce those claims for two reasons:

1) It's difficult to prove damages, and

2) Typically, the offer for employment is at will and once you start working, you can be terminated for anything so long as it is not illegal or discriminatory. The day you start, you are an ‘employee at will,’ Moore says.

“There have been some courts over the years who have upheld those claims or enforced them, but they're few and far between. It's not something I would advise employees to rely upon,” she says.

If you do believe your offer was rescinded based on your status within a protected class (think age, race, sex, gender, ability and the like) or if there was a misrepresentation of authority on the part of the hiring company, or you were defrauded in terms of pay, benefits, the existence of the role itself, then your case could seem much stronger, Rampenthal says. But again, it can be very hard to prove, especially in cases of fraud.

“In these cases, unless it’s extremely clear and you have direct evidence of discrimination, it might be easier to try to negotiate outside the legal system,” he says. “You can approach the company and start with, ‘Look, I thought this was going to happen, and obviously it didn’t; I incurred these costs while purchasing equipment, moving, so can you help me out and reimburse me for those costs?’” he says.

How should employers handle rescinded job offers?

From an employer perspective, most will rescind job offers as soon as they become aware of an issue. From a legal perspective, the employer should notify the individual as soon as possible. For example, if one company is merging with another and through that merger the company believes it will need only 25 percent of the jobs it thought it would need, typically the employer will notify those individuals it hired before the merger goes forward, when there is an obvious, known result for those individuals.

“Employers should also do what they can to treat the individual as best they can. They should help the employee find another job inside or outside the company. They don't want to get a reputation of rescinding job offers because then they'll have trouble getting people to work for them,” Moore says. “They need to consider the ramifications of rescinding job offers and do what they can to minimize the negative results of that. Most employers are cognizant of that; they're cognizant of the detrimental reliance theory even though it hasn't borne out in courts,” she says.

If you do seek legal representation, keep your expectations realistic, says Rampenthal, and trust they’ll be honest with you about your chances of success.

“If you seek legal advice and they won’t take your case, you have to understand it’s not personal; they don’t believe there’s enough evidence,” he says. “So, pivot that energy into your job search and keep moving forward. If something’s really wrong, you won’t have a problem finding someone to take your case. So be prepared to hear the hard truths, and keep looking for other roles,” he says.


Copyright © 2018 IDG Communications, Inc.

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