"We made an offer of employment verbally to a particular candidate who was headhunted from a different employer and no preconditions were placed on this offer.  We have become concerned at the ability of this individual to undertake the duties of employment on the basis of them being problematic with her previous employer and having brought a claim against them.  We wish to withdraw the offer of employment. How do I handle it?"

The withdrawal of the offer following a headhunting of this individual is susceptible to a claim of breach of contract, unless the offer was made conditional upon some factor such that would permit the withdrawal of the job offer.  For example, the offer being subject to satisfactory reference checks.

Generally, once an offer of employment is made and accepted whether orally or in writing, a collateral contract has been formed i.e. a contract to employ.  In the UK case of Sarker v. South Tees Acute Hospitals NHS Trust, the employee whose contract of employment was terminated before she had even commenced her employment was entitled to bring a wrongful dismissal or breach of contract claim.

In the decision of Stack Limited the Court of Appeal found a contract of employment had come into being even though no wage had been agreed.

In this scenario, the Company as the prospective employer made a warranty of employment to a prospective employee that if they left their current employment, they would be given the new employment.  In reliance on this warranty the prospective employee left their existing employment, and if a prospective employer, being the Company here, reneges on that contract by withdrawing the offer now, the other party may sue on it.

In this case, had the offer been made subject to satisfactory reference checks then were those checks to come back as inadequate; the Company would be entitled to withdraw the job offer.

In the absence of such a precondition, the Company could seek to withdraw the offer, but they take the risk of a breach of contract claim. The other option is to allow the contract of employment to commence and then terminate the contract during the probationary period, provided this is allowed for in the contract.  Both options may be problematic depending on the circumstances.

As can be seen from this example, it is important that your contracts of employments are carefully drafted to include specific pre-conditions such that would permit the withdrawal of an offer of employment in specified circumstances.

Contracts should also include appropriate probationary period clauses and the right to terminate on notice.

In this regard, employers should have regard to the new Transparent and Predictable Working Conditions Regulations 2022, which came into effect on 16 December 2022, and which limit probationary periods to six months duration.