Can an employer that is affected by the coronavirus crisis postpone a new recruit's start date or withdraw a job offer?

Employers facing financial difficulty due to the coronavirus (COVID-19) crisis may wish to postpone a new recruit's start date as a cost-saving measure, particularly if a temporary reduction in demand means there is no current need for the employee. There may also be practical difficulties in taking on a new employee if, for example, the entire team has switched to working from home.

Where the employee has accepted a job offer and the start date has been agreed, this will be a term of the contract. The employer would be able to change the start date only with the employee's agreement, otherwise it would be in breach of contract. A new recruit may be prepared to accept such a change if the employer explains the circumstances, particularly if the alternative is that the job offer will be withdrawn.

An employer that withdraws a job offer for reasons related to the coronavirus outbreak is likely to be in breach of contract. An employer can withdraw an offer only if it was conditional on certain requirements being met (such as receipt of a satisfactory reference) and the reason for withdrawal is that the conditions have not been met.

Where an employer does withdraw a job offer due to the coronavirus crisis, the employee could claim for breach of contract. It is likely that the compensation would be limited to payment for the notice period under the contract. To avoid such a claim, instead of withdrawing the job offer, the employer could give the employee notice of termination and pay them for the notice period. The employer should ensure that the reasons for the decision are well documented, to avoid any allegation of discrimination.