Withdrawing job offers: the risks and how to limit them

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Can you withdraw a job offer once it has been made? We look at the risks employers face if they change their recruitment plans. Sometimes, employers need to withdraw an offer of a job. The hiring situation may change because of a general recruitment freeze, a restructure within the organisation or a change of management. Or perhaps the funding for the post has been withdrawn. Alternatively, the employer may become aware that the selected candidate is not suitable after all. Job offers can be withdrawn after they are made, but there are risks associated with doing this; withdrawing an offer because circumstances have changed looks like bad planning and could affect the employer’s reputation. Furthermore, the employee may be able to bring a tribunal claim for breach of contract.

When is the contract of employment formed?

An employment contract is formed once an unconditional job offer is made and accepted. If the employer withdraws an unconditional job offer once it has been accepted, it is effectively terminating the contract and could be liable for damages for the individual’s loss. Even though the individual has not started working, there will be a notice period due – just as with other terminations. Damages could amount to what the individual would have received if the employer had given proper notice - including any pay and benefits due if he or she would have started work during the notice period.

What if recruitment plans change?

If an employer’s recruitment plans change