Revocation of Job Offer After Acceptance
There is a strong presumption of employment at will under Pennsylvania law for all employer-employee relationships. This means that either an employer or employee can terminate the employment relationship at any time for any reason or no reason at all. However, the presumption of at-will employment can be overcome under certain circumstances.
On numerous occasions we have been consulted when a client accepts a job offer from a new employer, resigns from a job with a prior employer, and after resigning, the new employer withdraws the new job offer, leaving a client with no job. In some other instances, the employee may work for the new employer for a short period of time and then the new employer terminates employment. While employment in Pennsylvania is generally at will, there are situations in which an employee who accepts a job, resigns from the former employer, and then has the new job offer withdrawn, may have a cause of action against the new employer.
Pennsylvania courts have held that the presumption of at will employment does not apply where a prospective employee provides "additional consideration" other than services for which the employee was hired. The term “additional consideration” can apply when an employee gives up a stable position with a previous employer, only to be fired shortly after being employed by the new employer, or where the employer withdraws the offer of employment. Cases in Pennsylvania which provide support for this situation where an employer can be found liable include Cashdollar v. Mercy Hospital of Pittsburgh, 595 A.2d 70 (Pa. Super, 1991); and News Printing Company, Inc. v. Roundy, 597 A.2d 662 (Pa. Super. 1991).
In Cashdollar, the Court found that when a hospital executive accepted an offer of employment as Vice President of Human Resources, resigned from his position, sold his home, moved with his family to relocate for the new job, and then was abruptly fired shortly after starting the new job, the employee could recover damages based upon a breach of an implied contract of employment, and the court upheld the trial court’s award of $204,000.00 in damages. The hardship which the employee was able to prove in Cashdollar is that he gave up his secure employment with his former employer where he had worked for over four years, uprooted his pregnant wife and child, and sold his home based upon an understanding that he was hired for a new job.
Another example of a situation in which a Court found sufficient consideration to overcome the presumption of employment at will occurred in News Printing Company, where an employee who lived in Massachusetts was hired to work as a general manager to work for a company located in Pennsylvania. Before being hired, the employee had advised the employer that he would need six months in the new job to become effective and before the employee accepted the job the employer stated that he would give the employee the time he needed in the job. The employee was hired, sold his house in Massachusetts and purchased a house in Pennsylvania. The employer then terminated the employee's employment less than four months after his employment started. While the employer argued that the presumption of employment at will was not overcome because the evidence failed to show that the employer and employee intended to form a contract for a reasonable period of time, the Court relied upon the doctrine of additional consideration and found that where an employee undergoes a substantial hardship other than the services which he is hired to perform, just cause exists to presume employment for a reasonable time. Thus, the Court found that that an implied contract for a reasonable period of time existed because the employee resigned from his previous job, rejected another job offer, sold his house in Massachusetts and purchased a house in Pennsylvania.
The premise of this line of cases is that an employee can defeat the "at-will" employment presumption by establishing that the employee provided the new employer with “additional consideration.” The term “additional consideration” applies when an employee affords the new employer with a substantial benefit other than the services which the employee is hired to perform, or when the employee undergoes a substantial hardship.
We have successfully represented employees who have accepted a job offer, resigned from a prior employer, and then had the job offer withdrawn, or were terminated shortly after accepting the new job. Call Abramson Employment Law at 267-470-4742 or contact us online to discuss your legal options if you are an employee who accepted a job offer, resigned from a prior employer, and then had the job offer withdrawn, or were terminated shortly after accepting the new job.