As a general rule, job offers should be extended in writing and certain points should be covered in extending an offer:
How can you prevent employment offers from becoming contracts?
Offer letters as contracts. An offer letter is frequently the most concrete available evidence of the employment agreement. There are many cases construing offer letters as contracts based on the language in the letter. When writing an offer letter, a cautious employer should select his or her words carefully. While employers cannot rely solely on an offer letter as a means to escape promises communicated orally to a prospective employee, neither should an employer's inappropriate choice of words, written in a casual way, bind the employer to a long term employment obligation that is not intended. The letter should be seen as a formal memorandum of the employment offer and not a binding contract.
There is legal danger of making statements in an offer letter that implies an employment contract. These statements can sometimes lead to expensive litigation if an employer later decides to terminate the employee.
Statements about job security. Any statement that alludes to job security can be interpreted by a court as a promise of job security.
Be wary of statements that designate employees as permanent
in contrast to those designated probationary;
such statements may be found to constitute a contract for long-term employment.
Don't make statements like, you will have a long rewarding and satisfying career ahead of you,
or we will pay one-half your moving expenses now and the balance after one year.
This kind of moving expense language may be construed by a court as intent to have the employment contract extend for at least one year.
Don't promise a minimum term of employment. An offer that stated the firm will employ you for two years minimum,
and This employment begins today
was found to bind both the employer and the employee to a two-year term of employment.
Use such language as, in the future,
this is to outline our future agreement,
to clarify that you are not making binding commitments as to future employment security.
Future promises of employment. Employers should review offer letters, all recruiting advertisements and literature for language that could be even remotely be construed as a promise or contract of employment.
Examine any words or phrases that might be viewed as implying a fixed duration of employment. For example, words like our organization family
and related statements about job security
or lack of layoffs within the organization
should be avoided.
Include in any offer letter, advertising brochures, application, and organization handbook a statement explicitly stating, there are no contracts,
and make some reference to the employer's and employee's right to terminate the employment at will.
If there are employees that have contracts, then state who (by title) can authorize contracts and under what circumstances.
Avoid contractual rights statements. In the job interview and in the offer letter, avoid all language that would indicate that prospective employees have any contractual rights.
Recruiters and interviewers should not make statements like
You'll be with us as long as you can do your job,
You will not be fired without just cause,
This is a organization in which you can stay and grow,
In this organization you'll have lots of job security,
Your salary will be $xxxxx annually.
Quote salary on a weekly or monthly basis to avoid the implication that employment is for a year's duration.
Review notes of job interview discussions to determine whether any promises were made, implied or otherwise, that need to be corrected in the formal offer letter.
Do not revoke an offer once made. There is a legal trend toward enforcing job offers made by employers, especially when a prospective employee gives up something of value or changes his position in reliance upon the employer's promises. If a job applicant resigns from a position in reliance on an employer's promises of future employment, an employer may be liable.
An individual resigned his former position and turned down another attractive job offer based on an employer's extended job offer. Then the employer refused to hire him because it did not receive the necessary favorable references it expected after the offer had been made. The employer was required to honor its offer; the reference question should have been resolved before the job offer was made.
If the employee spends substantial sums of money in reliance on an employer's promise, that employer may be liable for breach of contract.
At the time of hire, an employee was told that she had to furnish her own automobile for the position. Since she had no car, she borrowed the money and bought a car. After she bought the car, she was informed that someone else had been hired for the position. The employer was found legally responsible for damages the prospective employee incurred for purchasing the automobile.
Even though an employee's future position with a organization may be terminable at-will, an employer may be liable for breach of contract based on its revocation of an employment offer.
An employer promised to hire an employee if he passed a physical examination, resigned from his then-current job and moved his place of residence. Although the employee complied with these conditions, the employer revoked its offer because the employee failed a credit check. Did the employer have a right to withdraw the promise of employment because its employment application stated that the employee was terminable at-will? The employee's at-will status did not go into effect until he was assigned work and a salary, and the employer could not refuse to hire the employee based on a poor credit history where a favorable credit rating was not made an express term of the employment agreement.
An employee quit his job to accept an out-of-state employment offer. While he was in the process of moving into his new apartment in the new state, the employer fired him, allegedly because he came into the office in jeans and a T-shirt while on a house-hunting trip and made disparaging remarks about the local area. The good faith covenant of fair dealing implied into employment agreements made it reasonable for an employee to expect that if he quit a job and moved across the country, he would not be fired before he had the opportunity to show that he can perform the job.
The implications of these court decisions are clear. An employer's decision to revoke an employment offer may end up being second-guessed by a judge or jury. Employers need to take corrective or preventive measures to preclude this. After all, the decision to act is the employer's. Therefore, the employer should have completed whatever steps required by the employer to the organization's satisfaction prior to the decision to hire.
Standard of fairness. Where a fact situation involves the promise of a job followed by the refusal to perform the promise, the court will examine such factors as:
Did the employee resign from another position?
Did the employee move his household any distance?
Did the employee discontinue his efforts to find other jobs?
Did the employee give up another attractive job offer?
Did the employee expend substantial sums of money in reliance on the job offer?
<p>As a general rule, job offers should be extended in writing and certain points should be covered in extending an offer:</p>