You are the Judge – employment offer contracts


Employment offers are really interesting situations in law. What happens when you have an offer? How binding is it? Can it be enforced? The eleventh scenario in our You are the Judge series is just this situation.

You are the Judge - employment contracts

Rosie is an experienced accountant. Recently she was headhunted by Cover, Shred and Hide, a new boutique firm that had recently formed in the City of London.

After a successful interview, she has received a formal letter offering her the job, asking for her to accept by return of post. She did so the same day and arranged a meeting with her current manager for later in the week in order to submit her resignation.

However, CSH have had second thoughts. The son of one of the senior partners has just qualified as an accountant, and they are very keen to offer him a position. After a meeting the next morning, they wrote to Rosie apologising and withdrawing the offer. The next day, they received Rosie’s acceptance but discarded it.

Rosie received CSH’s letter on the morning she was due to resign. Although disappointed, she has cancelled her meeting and not left her current job. However, she is angry with CSH for messing her around. She is thinking about bringing a case claiming that they should pay her a month’s wages in lieu of her notice period, which was specified in the offer letter.

Do you think she has a point? Will she be successful?

The answer:

The question here is whether there was ever a contract. If so, then Rosie can claim she has been wrongfully dismissed and is indeed entitled to notice period.

To be binding, a contract requires both an offer and an acceptance. An offer may be withdrawn at any point up until it is accepted. In this case CSH made an offer but withdrew it before they received the acceptance. However, this is not fatal to Rosie’s case.

Due to a common-law principle known as the postal rule, if an offer is made by post then it may be accepted by post, and what’s more, the contract is deemed to be accepted at the time the acceptance is posted.

This is because the postal service is deemed to be a de facto agent of the offeror (CSH). Accordingly, Rosie’s letter of acceptance is valid and she is entitled to her contractual rights. One month's notice pay it is!

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