Rescinded Job Offers

Is it illegal to rescind a job offer under New Jersey employment law?  The answer is that sometimes, under certain conditions, it certainly can be.

Breach of Contract

 If the job offer came with an employment contract which the employer and employee agreed to, it certainly can.  Contracts are easier to prove when written, but oral contracts are also enforceable – the main question with oral contracts is whether there is sufficient evidence to prove its existence.  In any event, both written and oral contracts must meet certain requirements, including offer and acceptance, consideration (an exchange of value), clear and definite terms, and mutuality of assent or a “meeting of the minds.”  The most difficult part to find before employment starts is consideration, but this can be satisfied when an employee leaves her prior job in reliance on the contract for employment, for example.  Employers may have defenses, but a written employment contract is an employee’s strongest protection in any situation, including withdrawn job offers.

Promissory Estoppel

Even when there is no contract, the quasi-contract doctrine of promissory estoppel can provide the basis for a lawsuit against a prospective employer which has offered someone a job and then rescinded it.  In order to prove promissory estoppel, the prospective employee must show (1) there was a clear and definite promise; (2) the promise was made with the expectation that the prospective employee would rely on it; (3) the prospective employee must actually have reasonably relied on the promise; and (4) the prospective employee must have incurred a detriment because she relied on the employer’s promise.  Thus, in the case of Peck v. Imedia, Inc., the Appellate Division of the Superior Court of New Jersey found that an employee could recover for promissory estoppel when she quit her job, moved from Boston to Morristown, left her apartment in Boston and signed a lease for a new apartment in New Jersey in reliance on a rescinded job offer.  In a separate case, Jenkins v. Region Nine Housing Corp., the Appellate Division found that an employee could sue a company for promissory estoppel when she had leased a car required for the job which she could not afford without it based on a job offer which her prospective employer later withdrew. .

Good Faith and Fair Dealing

Contracts in New Jersey, including employment contracts, are implied by New Jersey employment law to have a covenant that the parties will act in good faith and deal fairly with each other so that they both get the benefit of what they bargained for.  A prerequisite for a violation of this duty is that there is a contract.  However, even when there is no contract, courts have indicated that whether the prospective employer acted in good faith and dealt fairly with the prospective employee would be taken into consideration in an analysis of a promissory estoppel claim.

Discrimination

Both the New Jersey Law Against Discrimination and Title VII of the Civil Rights Act of 1964 prohibit taking an adverse employment action for a discriminatory reason.  This includes refusing to hire, and therefore prohibits rescinding a job offer for a discriminatory reason. New Jersey’s Law Against Discrimination provides more protections than Title VII, and prohibits discrimination because of an individual's race, religion, color, nationality, ancestry, national origin, age, sex, pregnancy, familial status, marital or civil union or domestic partnership status, creed, affectional or sexual orientation, gender identity and expression, genetic information, atypical hereditary cellular or blood trait, liability for military service, and mental or physical disability (including perceived disabilities), and AIDS/HIV status.

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