Can we rescind a job offer to a candidate?

Can you rescind a job offer to a candidate? The answer, in short, is yes, but be careful as to minimize legal risk and be empathetic to the candidate’s situation. You’ll need only to do this if you are experiencing a pervasive issue with the candidate in question.

A few reasons why you may rescind:

• Poor results of a drug test or background check.
• The applicant's failure to appear for a drug test or physical.
• Learning that the applicant has had a negative relationship with an important customer.
• Lack of response or communication from the candidate.

Even if an employer has stated on all offers that employment is at-will and can be terminated at any time, there is the concept of the employer making a "promise" of a job. If the promise of a job is rescinded, it could cause economic and emotional harm to the candidate (also called “promissory estoppel”).

One of the best ways to prevent your organization from liability for withdrawing a job offer, is to have a policy explaining that an offer can be rescinded. This should be located in your handbook, but you’ll want to make sure the candidate is aware of the policy at the time of their offer and are advised that all job offers are “conditional”.

Conditional, in this case, means that the candidate must provide all necessary paperwork, pass all pre-employment tasks, and be timely in the pre-employment process. Make sure that your offer letter states this, and have all applicants sign an acknowledgment.

Note that rescinding offers should not be an ongoing practice as this can tarnish your reputation as well as brings a legal risk to the business.

If you decide to rescind an offer, make sure to do it sooner rather than later; the further in the process the more liability the employer holds. Be sure to be aware of any state laws. Some states including California, Colorado, and Nevada have laws that impose criminal or civil penalties on employers that offer work under false pretenses.

Last, never ever promise to hire someone without all pre-employment processes completed! Simply make the offer in good faith, but do not imply that a contract exists.

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