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A recent EAT judgment highlights the need for careful drafting of conditional job offers.
In Kankanalapalli v Loesche Energy Systems Ltd, the employer withdrew a job offer for a project manager role shortly before the scheduled start date, due to project delays.
The offer letter set out all the key terms of the contract and stated that it was 'subject to' receipt of satisfactory references, a right to work check and a successful six-month probationary period. The claimant emailed to confirm that he accepted the offer.
The offer was then withdrawn, before the references and check had been completed, but the EAT rejected the argument that these were conditions precedent and had to be fulfilled before there was a binding contract. The EAT considered that, as completion of a probationary period could only be a condition subsequent (operating after a contract had been formed) and the three conditions had been grouped together without differentiation, all three were conditions subsequent. Therefore a binding contract had been concluded.
This could only be terminated by notice and, as notice had not been expressly agreed, a term of 'reasonable notice' was implied. The EAT decided that, in view of the requirement for international relocation, the seniority of the role, the length of the recruitment process and the employer's suggestion that the claimant take on a 12 month rental, a three-month notice period was reasonable (even during the probationary period). The fact that a notice period of one week was included in the employer's standard terms was irrelevant, given that these had not been discussed with the employee before the contract was formed. The individual was therefore entitled to damages equivalent to three months' notice.
The case underscores the importance of making clear when pre-employment requirements are intended to be conditions precedent, preventing a contract from being formed until fulfilled; where there are also conditions subsequent, these should be carefully distinguished. It would also be prudent to expressly set out a notice period in the offer letter, including any shorter notice period applicable during probation if this is desired. As this case illustrates, 'reasonable notice' implied in the absence of an express term can substantially exceed the statutory minimum period, depending on the context.
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