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Job Offer Follow-Through Critical

In two recent cases, California appeals courts held employers responsible for lost future income to employees who left secure jobs to accept new positions. In one case an employer made a job offer and then withdrew it; in the other, the hiring supervisor misrepresented the compensation of the new position.

In the first case, an applicant, relying on a job offer, quit his job and was then unable to find work matching his former income after the offer was withdrawn. The applicant won a half-million dollar judgment, which included the amount he would have earned had he continued working at his former job through retirement, reduced by earnings received and expected from the employment he had been able to find.

In the second case, the interviewing supervisor represented that the applicant would earn substantially more than at his current job. The applicant accepted the new job, but after several months of complaining that his earnings were lower than represented, he was fired. The employee was unable to return to his former job or find other work matching his former income. The appeals court upheld an award of over a million dollars that included future lost income plus punitive damages, based on a fraudulent claim that the employer induced him to leave secure employment by knowingly making false promises regarding the terms of his future employment.

What Should You Do?

  • Offer employment only after you have completed all steps in the hiring process.
  • Train all interviewing supervisors as to the limits of their authority to discuss terms of employment.
  • Require all interviewing supervisors to tell applicants that employment offers can only be made in writing by an authorized company representative.
  • When making written offers of employment, include a clear statement that your company is an at-will employer (explaining what that means) and clearly describe any conditions that remain to be satisfied before the offer is firm.

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