Legal Dilemma: Can an Accepted Job Offer Be Revoked After Negative Reference Feedback?

Dear HR fellows, I wanted to understand the legal implications involved in the following case: The HR manager has emailed a job offer, and the candidate has accepted via email. He has also submitted his resignation in his current company and has emailed the acceptance of the resignation to the HR manager of the company that made the offer. Now, during the reference check, the business manager receives negative feedback and, therefore, wants the HR manager to revoke the offer days before the candidate is scheduled to join.

Legal Implications and Court Jurisdictions

1. What are the legal implications on the HR manager and the company that made the offer in this case? Which courts of law can this case be legally challenged (labour court, consumer court)?

Alternate Approaches

2. What alternate approaches would you suggest?

Thank you.
Regards

Clarifying Negative Feedback in Reference Checks

May we ask anything about the negative feedback? Is it a factual report about the damages caused by the talent you are trying to hire, or is it a subjective account of the behavioral conduct of the talent?

Any talent resigning from an employer ruffles too many feathers. Hence, settling the score with a negative account during the reference check remains obvious.

Looking forward to hearing from you.

Regards

Background Verification for New Hires

Background verification for new hires is a very common practice that many companies follow. It usually starts with a time slot of verification, beginning from the release of the offer letter to reporting or joining. In some companies, it may not be completed within the initial 3 months. Therefore, there is no need to worry about whether it is the joining day, the day before joining, or after joining. Based on the feedback from the verification process, companies have the right to revoke the offer or terminate the agreed employment due to negative feedback from the background verification.

Reference Checks and Feedback

Since reference checks are a part of background verification, it is advisable to request the manager to obtain negative feedback from the reference person in documented form and use that to revoke the offer. However, it is important to ensure that the new hire receives similar feedback from all other references mentioned. If not, there could be a possibility of false feedback from the reference person.

It is recommended to gather feedback from more than one reference, compare them, and then make a decision on revoking the offer. Employers may not always be willing to let go of their talented resources, which can lead to the potential of providing false feedback.

Thank you.

Specific answers to your queries are as below:

Legal Implications of a Job Offer

1. As far as legal complications are involved, an offer of employment is just an offer. Even after acceptance from the other party, it still remains an "offer." By that, it is implied that it is different from a "contract" or an "agreement" under law. A party can withdraw it at any time without creating any legal encumbrance upon itself. Though it is not common, and good companies would never do it, the fact remains that they cannot be legally forced to honor their "offer," nor can they be asked to compensate any expenses or hardship that the other party undergoes owing to it.

Alternative Approaches

2. For any alternatives, please try the approaches as others have suggested.

Warm regards.

The Weight of an Offer Letter

An 'Offer Letter', in my opinion, carries no weight until it is followed by an 'Appointment Letter'. If, in the intervening period, there is negative feedback during the verification process, the 'Appointment Letter' may never be issued. Therefore, for a candidate to resign from his/her existing job before receiving an Appointment Letter is a risky proposition.

Even after an 'Appointment Letter' is issued, termination of appointment stands valid if the feedback from a registered verification agency reflects on the candidate's integrity and morality (such as submitting forged documents, hiding some facts about past employment, being an accused in a court of law, etc.).

You can't claim to be an employee until you have joined an organization.

I believe it is necessary to examine the terms of your contract. For example, does your offer letter state that employment is contingent upon receiving favorable character check results? If this is the case, then the contract can be revoked without any legal implications. Additionally, as mentioned by other contributors, it is essential to verify the authenticity of the reference check.

All the best.

Regards,
Blessing A

I want to believe that employment is dependent on favorable check results. Therefore, if the check result is not favorable, then the employment cannot continue. Before you can reach a conclusion, please ensure that the former employer is telling the truth. Some people can be mischievous or wicked and may write negative reports. However, if the report is accurate and the new employer truly has a bad report, then you can terminate the employment immediately.

Thanks,
Blessing A

Why Was an Offer Made Before All Referee Checks Were Done?

I have said time and time again in these forums that recruitment is not rocket science. It can be very simple. BUT you must have a complete process in place, and all staff trained to follow that process to the letter. By not following a proper process, you leave your organization open to legal action and other sanctions.