Schrödinger’s Job Offer: When An Employer Takes Back A Job Offer By Pretending It Never Existed

by | February 7, 2020 | Civil Litigation

It’s happened to my friends and no small number of the people who call into our office. They received a job offer, or rather, they were told orally in language they cannot precisely recall, replete with reassuring gestures and talk of the future, that a business with which they have already completed the interview cycle is going to make them an offer. The functionary who made the “offer” has said something that would cause any reasonable person to be sure that the offer had been extended. E.g. “can’t wait to work with you.” They’ve discussed and agreed to a compensation package and possibly received a preview of the benefits package. This entire exchange occurred orally, of course, nothing in writing, because in today’s age, to demand something in writing is to broadcast an unappealing sense of distrust and to acknowledge the dismal Hobbesian reality of the modern workplace). They really can’t wait to work with you and you’re going to love it here. The company just needs a few days to put together the paper contract to make it formal (or something to that effect).

But they never do. Days turn into weeks, and the paper contract or offer letter, which the interviewer characterized as a mere formality, never materializes. Eventually, after several polite inquiries, someone in human resources responds to say that they’ve decided to go with someone else, or not to hire at this time. The job applicant is now out of a job and has not been looking for one since they (thought they) secured this one. Perhaps they have even missed out on other offers in reliance on the fraudulent job offer and will be unable to find comparable employment. What can the applicant do?

Unfortunately, many states lack laws tailored to this issue. Nonetheless, several options may be available to workers who are harmed when a business deceives job applicants about the status of a job offer. Claims of fraud, breach of contract, fraudulent inducement, tortious interference with prospective business advantage, promissory estoppel, and other torts are potential grounds for a lawsuit in situations like this. For example, a business might deceive an applicant into believing they have a job offer to prevent them from considering other offers, while the business continues to look for better candidates. If this ploy is effective, and the employee foregoes other job offers in reliance on the fraudulent offer, they may have a claim for fraud or interference with prospective business advantage. This scenario is apt to occur in highly competitive markets like the New York and the Bay Area.

Few if any courts have addressed cases on this subject. This will likely change in if this trend continues. Cases based on revoked offers of employment or the denial of a job face many challenges. Among them, employees are expected to mitigate their damages by searching for new jobs, and the amount of damages is ordinarily reduced by the income from any job the applicant obtains. When efforts to obtain new employment are unsuccessful and losses due to the putative employer’s malfeasance are significant, however, lawsuits may be an effective tool for recovering lost wages. Ultimately, the availability and strength of these claims varies with the facts and the law in different jurisdictions, and whether to file a lawsuit is a complex decision depending on many variables.

To maximize their chances of bringing a successful lawsuit or negotiating a settlement, workers must act quickly in these situations. The types of claims potentially available have relatively short statutes of limitations – i.e. times within which they must be filed. Moreover, the longer one waits to institute a claim, the more memories fade and the greater the chance that critical evidence is lost or destroyed. An employment lawyer can help workers identify and preserve key evidence, assess their options, and move forward with either settlement negotiations or filing a lawsuit.