SPKR
Consultant In Education, Real Estate, Home
Tajsateesh
Recruitment/talent Acquisition, Career Counselling
Nashbramhall
Learning & Teaching Fellow (retired)
Kknair
Hr, Ir, Law, Disc. Matters
Puneet.sarin
Manager-legal & Finance
Kamadana Pradeep
Hr Professional
Valavanur
Consultant
+2 Others

My friend received an offer letter and he had accepted the offer letter. Just 10 days before the joining date, the company withdrew the offer letter stating that they no longer had the requirement? Can my friend take legal action? The company is an MNC and the location is India.
2nd October 2013 From India, Mumbai
Well, technically speaking he can take legal action. Reason being quite simple that as per Indian Contract Act, 1872, an offer can be revoked till the time it is received and accepted by the acceptor and once the acceptance has been accorded by the acceptor, the agreement comes into existence and thus any subsequent revocation shall tantamount to breach of agreement and thus will invite legal consequences.

But apart from technical view let's also see practical side of it. The candidate so selected by the company has never worked with the company at all so such candidate never changed to 'EMPLOYEE,' though he was expected to be done so after 10 days thereafter. In such an event, there is no question of breach at all. But wait, there's still some spot left on such company.

Even if Employer company takes such an argument, it will get trapped in ethical and legal wrong. Legal wrong we had already discussed in technical view. Ethically, if company had extended an offer and within reasonable time, it has been accepted by the acceptor, then company must honour it.

Now big question. What can we do? See, its MNC as you say. So it should be having quite good team of lawyers either on panel or on payroll to fight for it. In case you are from India, unless you have really good lawyer your chances of winning are quite low. But otherwise, you really have case to fight provided you had provided your acceptance well in time.
2nd October 2013 From India, Gurgaon
Hello Valavanur,
Further to what Puneet Sarin suggested/mentioned, pl clarify IF you have already resigned from your Present Job.
If Yes, can you take back the Resignation?
There are quite a few situations where 'legally' you would be RIGHT, but 'practically', the cost-benefit aspects [time, costs & efforts] MAY NOT be worth it.
Suggest MOVE ON.
All the Best,
Rgds,
TS
3rd October 2013 From India, Hyderabad
Please see the discussions at https://www.citehr.com/470730-can-em...al-action.html
3rd October 2013 From United Kingdom
SPKR I do agree with Mr.Puneeth Sarans view. There is no point in shadow boxing.
3rd October 2013 From India, Bangalore
Hi TS and other members,

Considering the above scenario,

Morally I feel the company is at fault, however since the candidate never made it upto employment, there is no logical reason for notice period / or even for compensation of some kind.



Nevertheless, the candidate obviously resigned from his first job and was ready to move out for the new offer; he can be stuck now!

Not every organisation (PEOPLE) understand that when an employee resigns there must be some additional benefits which made him take the step, and when we talk about withdrawing one's resignation, that is simply just costing the candidate more!

Losing credibility.

My query,
  1. You mentioned that the candidate COULD BE right only at a few occassions! Do ethical bindings / morals have no room in such a trial?
  2. While any candidate accepts offer, is it fair & possible that a compensation related clause be demanded by the candidate to be included only to protect the his / her interest in case such events occur which are not in favour of company.
  3. It is also possible that the employer may ask for a NO-SHOW compensation from the candidate which seems fair!

Regards






4th October 2013 From India
Dear all, It is illegal and unethical on the part of the MNC to decline appointment after acceptance of the offer of appointment made by them. As pointed out by Puneet, compensation is liable in this regard. But should it be left like that since court procedures are lengthy, cumbersome and costly. My suggestion, don't just leave it like this. Let there be some harbingers for change.KK
4th October 2013 From India, Bhopal
If at all, the new company do not want to go into legal battle, they would have allowed a person to join, who will be on Probation, for three to six months, and after a month or two, they could have terminated him, for non-satisfactory performance. In either case, the employee is in soup. Practically, an individual cannot fight in such situations, though he is 100 per cent right.
4th October 2013 From India, Mumbai
Thank you all for your valuable suggestions. Unfortunately, since the MNC withdrew the offer letter the very moment and his current employer had already recruited another replacement, he had to leave his present job. He is now looking out for opportunities. So he was asking whether taking legal action would help him.
5th October 2013 From India, Mumbai
Before proceeding legally, it is better if your friend can have a dialougue with the HR Head of the company which has issued the offer letter and explain about the hardship and loss faced by him due to the withdrawal of offer letter. Let that dialougue be recorded if possible so that it can be used as an evidence at a latter date during the legal proceedings. Also let them understand that he is going to proceed legally if they are not going to compensate the loss faced by him.
Withdrawing an offer by the company is not ethically right and he is going to win the case if the company is not able to settle this issue amicably.
5th October 2013 From India, Hyderabad
Just an add-up to above.

We all are talking about moral and ethical issues, right and wrong. Question is not about right and wrong here. Let's assume his friend file a case and case is even admitted by the court. As pointed out in beginning, the company is an MNC. So presumably it should be having good legal cell. Even if it doesn't have one, owing to bigger pockets it can hire good legal personnel, which obviously would be presumably better armed than your friend. Lets even ignore such vast differences and treat both at equal footing financially.

In Indian scenario, usual case takes 5-7 years to conclude at Trial Court, 15 years to conclude at High Court and 25 years at Supreme Court (M not talking about exceptions here). This time period is not due to inefficiency but due to overburdened judiciary. Lets suppose company doesn't think of going beyond trial court. In that scenario too, 5 year period is pretty long. Company can afford to show in its financials as contingent liability. But can your friend afford to put in that amount of time and effort in attending court hearings (some of which will be merely adjourned) along with his new job. He surely won't be allowed that much of leaves from new company. Also, one more critical point here. Pending law suit, irrespective of whose favour or against it is, will feature in his profile and background screening will show red and new company won't think of going into hassle of investigating root cause and genuineness and immediately reject such profiles.

Exercising legal remedy is good but it should be done with complete cost-benefit analysis. If after 5 years of toil, you receive compensation of say 25k plus legal cost of 5k, will it be worth it for that much of period??
5th October 2013 From India, Gurgaon
Mr. Puneet,
No matter what your intentions, but your post suggests like you are batting on behalf of MNC here and the message one can read is simply to Move ON!
To give an analogy:-
A person (we / us) happen to witness an accident on the road and the victim (the candidate here) was not at fault, but yet he was injured (say just mild bruises).
If no person stops and confronts or even compel the responsible person for his wrong actions and simply asks the victim to MOVE ON, just imagine where will this attitude lead us (the people).
MOVING ON is not an option! You or anyone for that sake has to fight (no matter what) for what is RIGHT!
I have no allegations against you, whatsoever just that I personally feel we shall empower those who know less, and give them hope that they can overcome a particular situation (if at all they are being wronged).
It SHOULD NOT matter how powerful your opponent / oppressor is!
Once again, no harsh feelings against you Mr. Puneet.

7th October 2013 From India
Every honest, sincere, and truth loving citizen will definitely supports Getblade comments, and so do I. One must keep on fighting against injustice. There may be people who keep on fighting, knowingly all the hurdles, and we call them mad people. Actually, they deserve great honour and salute, and we too respect their work… since this does not cost us anything !
However, practically, in today’s Indian scenario, especially on judiciary side, it is highly impossible to work on this. The time and cost schedule provided by Puneet is 100 percent truth, and is a fact today. Common man, who wants to live simple and peaceful family life, cannot afford to accept the truth pointed out by Puneet.
7th October 2013 From India, Mumbai
To Getblade/Abhaybandekar & to people who thought me as morally incorrect !!

While I had provided both the viewpoints.I had stressed on ignoring this and preparing for better future. What I had emphasized is not to accept the wrong. Unless one has the power to absorb such oppression, its sensible to take sidewalk. I'm not here batting for MNC or for corruption but its sensible to first understand who are we fighting against. Its like Bhutan fighting a war with US. Its highly beyond sensibility to fight such a war. But yes, when its about their dignity and national pride then all such sensibilities vanish and righteousness props in.

Let's take other view. Suppose the friend files a case. What will happen then? Will we get our means satisfied. Will we be there physically with that person or his filing of case will become a movement aka revolution? As a fuel for starting a revolution it will be really helpful but at the end of the day we all are working for 3 things-food, shelter and self respect.

Will his friend get this by filing a case? What will happen in all those months when case will be on? Who will help him financially and for how long? The families expand, time and situations change and with current inflation rate, we don't know where will it stop. But even if we all unite, will that suffice for that friend.

If suppose he take a sidewalk. Gets a new offer. Starts a new career with a bitter lesson learnt in life. Won't he be happy?

Ethics, righteousness etc. are all subjective concepts and should be applied in congruence with realistic situations, atleast in todays world.

At the end of this, I express my extreme apologies to all those who have felt hurt by my remarks, which in my opinion were realistic view. Hope I'm able to put up my thought process here.
7th October 2013 From India, Gurgaon
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