URGENT - Employer withdraws accepted offer at contract stage - breach of contract?

[QueenAnne]

Hi,

I need urgent help... thank you

As I know, a job offer that is accepted is a binding contract.
- if it was unconditional, it is a firm contract.
- if it was conditional then only if the conditions are not met can the offer be withdrawn.
Per the law, a contract can be provided up to two months after start date at the new job (terms etc - the usual employment contract.)

As I understand, this above means that an offer, if it is for example "conditional to satisfactory references and other checks being completed" cannot be withdrawn once it has been accepted (in writing) with reasons not related to the employee. Even with the ambiguous "other checks" cited as condition, a reason for withdrawal that is not related to the employee but related to the company only (budget, strategy, restructuring, acquisition etc.) cannot be covered by the "other checks".

The situation is;
The employee accepts the offer in writing and receives the contract, which the employee discusses with the employer on a conference call. Then employee sums up what the employer told sand sends it to employer asking it to be added/amended in the contract. Employee is waiting for an amended contract with errors amended, wording, working hours etc. There are no adjustments to the offer conditions e.g remuneration details, except that employee asks if it's possible to receive the holiday allowance discussed in the verbal offer discussion but changed in the first contract draft (aka changed after offer acceptance) to lower by 20%. In this case this employee has a new employment as I understand (still conditional to the offer's conditions.)

The employer doesn't ask for references but presumably runs a credit check (having asked for bill to residence address.) Employee has no defaults, bankruptcies, CCJ's or IVA's - is clean. Employer is not a banking society or similar and by law is entitled to public records only from CRA's.

The new employer that made the offer then withdraws this offer at this stage of amending the errors in the contract first draft - the employer withdraws the offer instead of sending the new contract.
The offer is conditional on the employee's references. The employer cites a withdrawal reason being budgetary and strategic changes (unrelated to this employee), and does not mention anything about any checks or referencing done or failed.

Employee notifies employer to double check, and notifies employer that employee's previous employment is now terminated.
Employer confirms that the offer is withdrawn, and confirms the reason being company strategy and budget changes.

As I understand the law, this is a clear breach of contract by the new employer.

What prospects does this employee have (tribunals, etc)?
What could this employee do?
If the employee had to give up their old employment - after accepting the offer and receiving the contract first draft, the employee can prove this timeline with dated documents - then this employee is now jobless, what hopes can this employee have?

Thanks a lot!

[des8]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

This link suggests you can sue for breach of contract
www.gov.uk/job-offers-your-rights

Similar advice here from Citizens Advice http://www.adviceguide.org.uk

As you have resigned from previous employment on basis of offer your claim should also include a sum for loss of income

[QueenAnne]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

Yes, but I hesitate because the offer in this case was not unconditional, it was "subject to satisfactory references and other checks" - then the reason was something else than these conditions, unrelated to the employee. There's no evidence of discrimination per se, the employer says the position will not be filled "at this stage" - citing budget and strategy though the position was offered with the verbal explanation of it being fully approved with the remuneration the offer came with. There's no sign of any checks made and no references were requested from employee and no indication that the employee failed on any conditions cited in the offer letter.

Also anyone could explain how one sues for breach of contract, just briefly? That is not ET stuff as I understood.

[des8]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

So the offer was conditional on references. The references weren't taken up. Conditions therefore not met & offer can be withdrawn as company have decided, for whatever reason, not to proceed.

I would not be surprised for the prospective employer to argue that the reason for not completing the contract is of no importance. They advised you as a matter of courtesy, but as the conditions had not been met they were entitled to withdraw the offer.

This might seem unfair, but I wonder if it is illegal.

Hopefully someone with more knowledge of employment & contract law will be along soon with more encouraging views for you.

[QueenAnne]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

I think this is where it gets even more complex.

The role was confirmed on the conf call where the offer was first made verbally, with the same remuneration, as completely approved. Then the offer letter was sent, with start date and the condition as quoted, and it was accepted in writing (including start date). Then the contract was sent with errors (two different working hours, for example) that had to be corrected, and a phone call was arranged to go through any unclear parts and discuss. Then the corrections were requested and instead of being applied, company withdrew the offer.

Because of the previous confirmation, budgetary reasons are outside the conditions, if I go by what you say - e.g. "if there's any condition cited, than any other reason can fit into that"
Also, important that the offer was made with a start date.
Third important point is that the condition stated could not have been checked before an actual signature of contract if the contract didn't have had the errors and ambiguous parts that had to be cleared. So employee's need to correct things such as the two different working hours prevented the signature otherwise there would be a contract - fair to say it would be before the condition being met and verified, and it would be binding.
The offer was accepted with that start date. Employee then asked to delay that date, and that is related to the other employment termination.

The employee passed CRB three months ago. So it's a fair assumption that the conditions cited in the offer letter would have been met.

I find it hard to go by this, that if there's one specific condition that would mean anything can be a condition that an employer wishes... I would take it as, if thee is one specific condition, then the offer can be withdrawn if that condition is not met satisfactorily but not because employer refuses to check (could be put this way I suppose - I don't check your references so you didn't meet my offer conditions and I can withdraw my offer....) It would mean that even if the contract would be signed, employer could withdraw for any reason which is not the case.

I had a link which cited this case as breach of contract - offer withdrawn for reason other than the condition cited - but I can't find now...

[charitynjw]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

Hi QueenAnne,

There is no legal requirement for an employer/prospective employer to issue a contract of employment; the legal requirement is for a statement of employment particulars, this to be given in writing within 2 months of the employee commencing employment.

Regarding the breach (presuming that a contract does exist - this has yet to be proven), the new employer would be liable for their statutory obligation, this being payment for the notice period applicable according to the contract.
Usually during a probation period, it is for one week's notice.

[wales01man]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

So in short they can try and claim one weeks pay?

[des8]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

IF, repeat IF, a contract was proven to exist and if it is held that the prospective employer had broken it, thus causing the prospective employee loss, those losses would be borne by the employer.

Could those losses not only include statutory losses (i.e. payment in lieu of notice) but also damages for encouraging someone to quit their existing job on an offer of a new position?

This is what Citizens Advice has to say: " If you have given up another job because you were offered the new job, you can also claim compensation based on what you were earning in your previous job and on how long it would have taken you to find another job had you left that job to find another one."

I think perhaps ACAS or a solicitor specialising in employment law should be approached for advice.

[charitynjw]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

Having reread post #1 from a contract law perspective, it would appear that the employer made an offer, then the prospective employee made a counter-offer (re various terms), which the employer rejected.

I'm a bit rusty on contract law, but I seem to remember cases where this voided the first offer - I may be wrong!

[des8]

Re: URGENT - Employer withdraws accepted offer at contract stage - breach of contract

...or was it " an offer made and accepted" so forming a contract.
Draft contract wording was not as agreed and so returned for amendment.
Contract then withdrawn, reason being "budgetary & strategic changes"
In which case can one pursue a case for breach of the verbally agreed contract, and would it be worthwhile?

We don't really know sufficient about the detail of the situation to be able to give other than general advice.

Like you Charity, it's many moons since I was up to speed with contract law, and then it was about insurance & banking. Any branch of the law is a nightmare.... put three lawyers together and you'll get three interpretations...... it's how they make their living