Job offers

Employers cancel job offers again – how to do it, if you have to

Stories of canceled job postings have started to surface, particularly in fast-growing sectors like tech and real estate, in another sign that the scorching job market is starting to cool.

Organizations that have experienced a recruiting overdrive due to the pandemic over the past two years have begun to put the brakes on for fear of an impending recession. The reversal of hiring plans has happened so quickly that instead of just slowing down or freezing hiring and canceling requisitions, employers like Coinbase, Redfin and Twitter are canceling job postings, a painful tactic commonly seen only during an economic crisis.

It should be noted that talent acquisition experts warn that the trend of rescinding job offers – while accelerating – is still a blip in the landscape and should not be exaggerated.

“Cancellation of job offers is rare,” said Valerie Frederickson, founder and CEO of executive search and advisory firm Frederickson Partners, a Gallagher company. “These cases are typically exceptions that occur among high-growth tech employers who find the sea legs for the next leg of their journey, or during a major recession when large employers overestimate hiring plans and have to cut them. Most companies match request approvals with budget forecasts in real time and stay on course even during market fluctuations.The problem is that some companies that have experienced extremely high growth are in their teenage phase and cannot haven’t had the time to implement workforce planning best practices yet.

Just because an employer can rescind a job offer doesn’t mean they should, said Jill Chapman, SHRM-SCP, senior performance consultant at Houston-based HR services firm Insperity. . “This should be a last resort if it is for reasons other than conditions not met by the applicant, such as a failed drug test. There may however be times when this is absolutely unavoidable due to a downturn in the economy or a change in business needs, such as a downsizing or an acquisition or merger eliminating the position.

Chapman added that if an economic change dictated that there was no longer a need for certain employees, it would be better to rescind job offers than to proceed with layoffs. This is especially true for those most commonly affected by job cuts – interns or recent graduates offered jobs well in advance, she said.

“In many cases, I’d say it’s better to rescind job offers than layoffs when the only answer is to cut payrolls — the biggest cost of running any business,” Chapman said. “That said, there are other avenues to explore before doing either, and the best thing to do is avoid the situation first through organized, well-paced growth and a strategic workforce planning.

Before having discussions about getting offers, HR should conduct a thorough workforce analysis, Fredrickson advised. “Review your strategic plan, succession plan, and employee demographics. Double-check for expected retirements and turnover that may affect you in the coming months or quarters. Don’t hire for general growth , but rather hire for specific needs and positions based on the company’s strategic plan for the budget. Try to find a better option,” she said.

Chapman reminded HR to proceed with caution to reduce exposure to legal liability when rescinding a job offer. “If the employer offers someone a job, and they accept, resign from their old position and move out so they can go work for the new employer, they may be able to take legal action. The potential employer made a promise and ultimately broke it, with serious professional, financial and general welfare consequences for the candidate,” she said.

Chapman recommended the following when writing the letter of offer:

  • Avoid terms that indicate a contract of employment, unless that is the case.
  • Avoid language that guarantees a job.
  • Indicate that the offer is conditional on meeting the requirements of the position.
  • Indicate that the offer will expire within a certain time and is not open indefinitely.

[SHRM members-only sample form: Conditional Job Offer Letter]

If you must cancel, do so with caution

As painful as the experience of rescinding job offers is for the organization, it is likely much worse for the new hire, especially for those who may have already given notice, turned down other offers and, in some cases, even started to move.

When companies are forced to cancel job postings, experts agree that prompt and transparent communication is essential. “Notify affected individuals as soon as possible to get ahead of them by giving notice to their employers, if possible,” Frederickson said.

Chapman said affected applicants should be informed that the rescinded offer “is not about them, their abilities or skills, but rather the business trying to understand the economy and its tax future. It must be communicated verbally. , then followed by a letter. Try to leave candidates with as positive an experience as possible, then give them some space to process what happened.”

Treating affected candidates with dignity and respect is key, experts agree. “The conversation should be treated with the same sensitivity as during a layoff,” Frederickson said. The worst thing you can do is completely ghost people, of which there are reports on social media.

Employers have no legal obligation to provide financial support or help affected people find work. But helping with a job search or severance package will go a long way to smoothing things over for those whose offers have been revoked. Both Coinbase and Twitter said they are paying compensation to those whose job offers have been rescinded.

“Employers can offer outplacement services and stipends to cover expenses in recognition of candidates’ lost time, lost income opportunities and resumed job search,” Chapman said. “Before offering help, clarify it with legal counsel and also consider what kind of precedent you are setting. And, when hiring resumes, look to that pool first, if possible.”

Additionally, employers may consider directing those whose offers have been rescinded to other vacancies in the organization, if there is an appropriate fit.

Frederickson said intrepid recruiters should be on the lookout for canceled job ads, in order to recruit blocked talent.

Repairing the employer brand

Everyone knows that canceling job openings is bad for employer brand, erodes trust, and signals poor planning or operational dysfunction.

“Candidates and current employees will lose faith in the company’s ability to succeed, which, in turn, will affect employee engagement,” Chapman said. “To overcome the damage, start by developing a social media presence to interact positively with employees, candidates and the public. Be sincere and authentic with candidates and show how much you care about them and your employees .”

In social media court, every move an employer makes is amplified, Fredrickson added. Glassdoor data shows that the number of posts mentioning job cancellations tripled between January and July.

“I’ve seen employers self-announce that they need to rescind offers, show empathy, and offer benefits such as severance packages to affected new hires,” Frederickson said. “The employer will make it clear that affected employees are being negatively impacted through no fault of their own and will also recommend them for future opportunities.”