Conditional job offers: be careful before withdrawing them
A recent Employment Appeal Tribunal decision is a useful reminder that employers should take care when withdrawing job offers, even where the offer is described as “conditional”.
The case involved a candidate who had been offered a senior project manager role. The offer letter said the appointment was subject to satisfactory references, a right to work check and successful completion of a probationary period. The candidate accepted the offer and provided the requested new starter information, including referee details and right to work documentation.
Before the employment started, the employer withdrew the offer because the project the candidate was due to work on had been delayed. The reason for withdrawing the offer was therefore unrelated to references, right to work checks or any other condition in the offer letter.
The candidate brought a breach of contract claim.
The Employment Appeal Tribunal found that, once the candidate accepted the offer, a binding contract had been formed. The conditions in the offer letter did not prevent the contract from coming into existence. Instead, they were conditions which could allow the employer to terminate the contract if they were not satisfied.
This distinction is important.
If a condition is a condition precedent, no binding contract is formed until that condition is met. If a condition is a condition subsequent, the contract is formed when the offer is accepted, but the employer may later be able to terminate if the condition is not satisfied.
In this case, the conditions were treated as conditions subsequent. The probationary period was particularly relevant because it could only take place after employment had started. The conditions had also been grouped together in the offer letter, without clearly separating those that needed to be satisfied before a contract existed.
Because the employer withdrew the offer for reasons unrelated to the stated conditions, and without giving notice, it was in breach of contract.
The offer letter did not include a notice period, so the Tribunal had to decide what notice would be reasonable. Given the seniority of the role, the length of the recruitment process and the fact the candidate was relocating to take up the role, the Tribunal found that three months’ notice was reasonable.
The employer was ordered to pay damages equivalent to three months’ notice pay.
What does this mean for employers?
The decision does not mean employers can never withdraw a conditional job offer. However, it does show that wording matters.
Simply saying an offer is “subject to satisfactory references” or “subject to right to work checks” may not be enough to prevent a contract being formed once the candidate accepts the offer.
If an employer wants to make clear that no contract exists until all pre-employment checks are complete, the offer letter should say so expressly.
Offer letters should also include a clear right to withdraw the offer if conditions are not met and should set out what notice, if any, applies before employment starts.
This is particularly important where the candidate may resign from another job, relocate, or make financial commitments in reliance on the offer.
Practical steps for employers
We recommend that employers:
- review their offer letter wording;
- make clear whether pre-employment checks must be completed before a contract is formed;
- include an express right to withdraw the offer if conditions are not satisfied;
- include a clear notice provision, including any shorter notice period during probation;
- avoid withdrawing an accepted offer without first taking advice.
This case is a useful reminder that offer letters are not just an administrative step in recruitment. Once accepted, they can create legally binding obligations.
Where an employer wants flexibility to withdraw an offer before employment starts, the wording needs to be clear. Otherwise, an employer may face a breach of contract claim even where the employee has not yet started work.