Withdrawal of a job offer – Is it a dismissal?

Sep 21, 2022

It often happens that after an offer of employment has been made by an employer to a job applicant (prospective employee), the employer withdraws the offer. Is that a dismissal?

The question is, when does the employment relationship start? The start of the relationship is often blurred on receipt of an offer, before it is accepted. Subject to one limitation, an offer of employment can be withdrawn at any time before the job applicant has accepted the offer. Let us unpack that further.

 

Legal framework

In terms of section 213 of the Labour Relations Act (LRA), an employee is:

(a) any person, excluding an independent contractor, who works for another person or for the state and who receives, or is entitled to receive, any remuneration; and

“(b) any other person who in any manner assists in carrying out or conducting the business of an employer”.

Given the definition, it is clear that a job applicant will only be deemed an employee and the employer’s legal obligations will only begin when the employee starts working for the employer. Usually when an employer withdraws the offer of employment after the offer has been accepted and the employee has signed the employment contract, the employee is forced to rely on the law of contract to address the breach.

In the matter between Wyeth SA (Pty) Ltd v Manqele and others 2005, 6 BLLR 523, the Appellant (employer) and Respondent (employee) concluded a contract of employment, however before the Respondent commenced working, a dispute arose pertaining to the terms and conditions relating to the use of the company car. The employer terminated the employment contract on the basis that both parties were unable to agree on the terms.

Subsequently, the employee referred a dispute of unfair dismissal to the CCMA and the matter eventually made its way to the Labour Appeal Court. The Appellant presented that the Respondent was not considered an employee as she did not commence work, therefore falling outside the legal definition of an employee. At the Labour Appeal Court, the court rejected the literal interpretation the Appellant ascribed to the definition of an employee in terms of the LRA and contended that the Respondent became an employee the moment that the employment contract was signed.

 

Conclusion

It is in the best interests of the employer and employee to ensure that all the terms and conditions have been agreed to before signing the employment contract. An employer is not permitted to terminate a contract of employment without consequence even if the employee has not yet commenced working. As depicted in the Wyeth SA (Pty) Ltd case, this could land an employer at the CCMA or even the Labour Court.

As stated above, if an employer wants to withdraw a job offer, it must be done before the job applicant has accepted the offer.

To protect the employer and employee in these instances, it is recommended that employers confirm that the offer of employment can be revoked should the applicant be flagged during a background check. Employers must state that the offer is conditional upon the job applicant meeting and/or accepting all terms and conditions of employment

Disclaimer: LabourMan exclusively provides services to employers.

The content does not constitute legal advice, are not intended to be a substitute for legal advice and should not be relied upon as such. Kindly contact us on info@labourman.co.za or 021 556 1075 to speak to one of our consultants.

Author:

Wallace Albertyn

Wallace Albertyn is a Senior Associate and Legal Advisor at LabourMan Consultants.
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