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Can a Company Rescind a Job Offer?

handshakeYou got a job offer. Congratulations! You are relieved to have landed the job, but should you relax until the job starts? What if, to your dismay, the employer rescinds the job offer a few days later? This doesn’t seem right, but it may be legal. Or what if you are the company who just offered a candidate the job, but realize later you cannot offer the job anymore. What do you do?

Many states are at-will employment states meaning employers and employees may terminate their employment at any time without any particular reason so long as it is not discriminatory. As a would-be employer, rescinding a job offer may have legal consequences you should be aware of before doing so and as a would-be employee, you should recognize that this could happen and understand whether or not you have a legitimate legal remedy for your damages.

Promissory Estoppel

Under promissory estoppel, if it is available in your state, a would-be employee can claim that there was a damages caused by the promise made by the would-be employer to him or her that he or she relied on and suffered damages as a result. The damages could be from quitting your current job in reliance of the new job, or from the relocation costs for the job offer. Check with an experienced employment and labor law attorney to determine if you have a cause of action in your situation.

Preventing a Problem

As an employer, the best protection against a lawsuit based on promissory estoppel is to avoid making the promise in the first place unless you are absolutely sure the promise will be carried out. Have an experienced attorney review your job offer and legal consequences should you decide to rescind the offer later.

As an employee, try not to make any drastic changes like telling off your old boss or selling your house to relocate until it is a sure thing, but do understand jobs are never a sure thing and have a labor and employment attorney review your job offer and help you decide whether you can claim any damages against the employer should they rescind it.

Mitigating Your Damages

If you apply for a job that was offered to you and later rescinded, you also be expected to mitigate your damages. “Mitigate” is a fancy word for saying you must take steps to minimize the total damages that you are suffering as a result of the employer’s precision of the job offer. Generally this involves applying for additional jobs to try to obtain new replacement work. You’ll need to keep track of all the places that you apply to, in order to demonstrate that you were diligent in attempting to find replacement work. Keep copies of the resumes you send out, applications you send in, and interviews that take place. According to the US Department of labor, it generally takes 7 to 9 months to find a new job, and if you quit your job based on receiving a new job offer, and have to start looking for new work all over again, it could possibly take some time for you to find a replacement job, and you want to make sure that you document your legal claims properly.

Getting Legal Help

AXIS Legal Counsel is an employment law firm representing clients  in numerous kinds of lawsuits and disputes involving some of the nation’s largest employers. Whether it is sexual harassment, other kinds of harassment, discrimination, race discrimination, pregnancy discrimination, medical/disability discrimination, racial harassment, retaliation, hostile work environment, wage/hour, workplace bullying, or other claims, AXIS Legal Counsel is experienced in the field of employment and labor law and focused on providing high-quality legal service.  AXIS’s managing attorney, Rabeh M. A. Soofi, is recognized as one of the “Top Women Lawyers in Southern California” by SuperLawyers Rising Stars, and is a Los Angeles Employment Attorney with experience representing numerous employees with a wide variety of employment claims.

For information on retaining AXIS Legal Counsel for any employment matter, contact [email protected] or call (213) 403-0130 for a confidential consultation, or visit our Employee’ Rights Practice Area, or Individual Rights Portal. AXIS is a Los Angeles, California employment law firm serving employees all over Los Angeles and California.


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