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

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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.
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.

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

SPKR I do agree with Mr.Puneeth Sarans view. There is no point in shadow boxing.
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






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
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.
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.
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.


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