Conditional Job Offers: Beware the Risks

When a conditional job offer is withdrawn, can an employee raise a personal grievance?

This is the question the case of Edwards v Laybuy Holdings Limited looked to answer.

In December 2020, Mr. Edwards accepted an offer of employment from Laybuy Holdings Limited. Not long after, Laybuy Holdings withdrew the offer of employment prior to Mr. Edwards starting employment, as they were unsatisfied with the results of the pre-employment police record check.

Mr. Edwards raised a personal grievance after the offer of employment was withdrawn. Despite the Employment Relations Authority finding that Mr. Edwards was not an ‘employee’ and was therefore unable to raise a personal grievance, Mr. Edwards challenged the determination, and the Employment Court reviewed the case.

Background:

After several interviews, Mr. Edwards was verbally offered a role with Laybuy Holdings Limited and was notified that there would be some standard pre-employment checks. This was followed up an offer letter which advised him that the offer “is conditional upon satisfactory pre-employment checks specific to the role we are offering you”. The letter also advised Mr. Edwards that the offer may be withdrawn if the Company was not satisfied with the results of the (police) checks. Mr. Edwards signed and returned the Employment Agreement that had been sent to him.

Mr. Edwards advised the HR lead that various items would show on his criminal record check, and that he had not disclosed them at the time of interview as he had not explicitly been asked, and previous employment offers had been withdrawn in the past due to his criminal record. When the checks came back and confirmed what Mr. Edwards had disclosed to the HR Lead, the Company called Mr. Edwards and advised him that the employment offer was withdrawn due to the results of the criminal record check, a letter was sent shortly after confirming the withdrawal.

In April 2021 Mr. Edwards sent a letter to raise his personal grievance. Laybuy Holdings Limited declined his claims on the basis that they had not entered into an employment relationship and the claim was eventually taken to the Employment Court on the basis that Mr. Edwards was a “person intending to work” and that he met the definition of an “employee” as defined in the Employment Relations Act.

The Employment Court reviewed whether Mr. Edwards was “a person intending to work”. While Laybuy Holdings Limited offered him a position, it required a satisfactory criminal record check for employment. The Court determined that Mr. Edwards’ acceptance alone did not bind the employment agreement. Consequently, he was not considered an “employee” under the Employment Relations Act and could not raise a personal grievance.

This ruling highlights the importance of thorough pre-employment checks. Employers should ensure that all conditions of employment are clearly stated and met before finalising the recruitment process.

Employers can take several steps to protect themselves when withdrawing conditional offers of employment.

1. Clear communication: clearly outline all conditions of the job offer in writing. This includes specifying that the offers is conditional upon successful completion of background checks, reference checks, or other pre-employment requirements.
2. Document everything: keep detailed records of all communications and reasons for withdrawing the offer. This documentation can be crucial if the decision is later challenged.
3. Consistent policies: apply the same criteria and processes for all candidates to avoid claims of discrimination or unfair treatment
4. Professional advice: seek advice when drafting conditional offers and when considering withdrawing an offer to ensure compliance with all relevant laws and regulations.
5. Timely notification: inform the candidate as soon as possible if the offer is being withdrawn, providing clear reasons for the decision.

If you need assistance with any of the steps above, please contact one of our experienced consultants who can guide you on best practice, ensuring you minimise risk and maintain and fair and transparent recruitment process.