27 Jan Withdrawing offers

Recently I received a very interesting article from the CCMA titled “Withdrawal of Offers of Employment- Does this constitute dismissal?”.  It was a very interesting, detailed article, so I thought that I would summarize a few key points for you.  Let me know if you would be interested in reading the full document, and I would be happy to email it onto you.

There are many instances when an employer revokes the offer of employment, before the job applicant actually starts work, and the employer legally defends themselves on the basis that the job applicant is not actually an employee until such time as they start work.

The job applicant is however protected by the Constitution and the Employment Equity Act which protects job seekers from discrimination (e.g. an offer being withdrawn because the company discovers that the job seekers is pregnant).  Although this protection exists to protect job seekers from discrimination, nowhere in the Basic Conditions of Employment, Labour Relations Act or Employment Equity Act does it shed any light on what recourse a job seekers would have if they found themselves in the position of having an offer revoked before they actually start work.  As with most things in Labour Law, there is no definite “right” or “wrong” answer, but rather it is a collection of the facts, and who makes the best argument with the facts.

Who is an employee?

The Labour Relations Act describes an employee are

• Any person, excluding an independent contractor, who works for another person and who receives or is entitled to receive any remuneration
• Any other person who is any manner assists in carrying out of conducting the business of the employer.

From the above definition it is clear that an employer’s obligation starts on the day the person starts work.

Definition of Dismissal

The term dismissal is defined under section 186 (1) of the LRA

as follows:

1. a) “An employer has terminated a contract of employment with or without a notice,
2. b) An employee unreasonably expected the employer to renew a fixed term contract of employment on the same or similar terms but the employer offered to renew it in less favourable terms or did not renew it,
3. c) An employer refused to allow an employee to resume work after she took maternity leave in terms of the law, any collective agreement or her contract of employment d) An employer who dismissed a number of employees for the same or similar reasons has offered to re-employ one or more of them but has refused to re-employ another,
4. e) An employee terminated a contract of employment with or without notice because the employer made a continued employment intolerable for the employee, or
5. f) An employee terminated a contract of employment with or without notice because the new employer after a transfer in terms of sections 197 or 197A of the LRA, provided the employee with conditions or circumstances at work that are substantially less favourable to the employee that those provided by the old employer”.

Under definition (a) above, if the employee can prove that they had entered into a contract agreement, and then employer was breaking this contract, they would have reason to claim unfair dismissal, even though they had not started working yet.

Background Checks

When offers of employment have been made, subject to the successful outcome of background checks, offer of employment can be revoked if the outcomes of the checks are unfavourable.  It  is important to state that the offer is subject to the checks.  These checks include reference checks, criminal checks, qualification validation etc.

Terms and Conditions of the Contract

It is important to agree on the terms of employment, before making an offer of employment, because later withdrawing the offer because the terms of employment cannot be agreed on, could land you at the CCMA for unfair labour practice. 

Conclusion

While the law does not explain what recourse and rights a job applicant has when an offer employment is revoked, it is safer for a employer to make sure of all back ground checks, terms of employment and overall suitability confirmed, before offering employment to a job seeker.