Important Disclaimer
January 2005
Retracting A Job Offer May Lead To Liability
Prepared By: Melissa C. Marsh
Proceed with caution…"at-will" employment is not as simple as it seems. Every employer rightly knows that at-will employees can be hired or fired for any reason, even for no reason, without notice so long as it is not for an illegal reason (i.e. provided the employer follows the law).
Generally, employers have been free to offer and withdraw offers of at-will employment. Problems however occur when the nature of the "at-will" is altered. In Toscano v. Greene Music, 124 Cal.App.4th 685 (2004), the California Forth District Court of Appeal held that a job applicant who quits an at-will job to accept another at-will position may recover lost future wages from the employer who presented the job offer if: (1) the second employer withdraws its job offer and (2) the employee who accepted the job offer (relied on the promised job offer) can prove lost earnings by "substantial evidence." The court reasoned that promissory estoppel (reasonable reliance on a promise, here the job offer) entitles a plaintiff who quit a job to recover the "lost future wages" the employee can prove s/he would have earned from his or her former at-will employer had the plaintiff not relied on the promised employment and remained at his former job.
For more information on how companies inadvertently change the nature of "at will" employment, see
How To Protect Your "At Will" Employer Status. |
