Is it promissory estoppel if an employer withdraws a job offer to prospective employee’s detriment?

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Is it promissory estoppel if an employer withdraws a job offer to prospective employee’s detriment?

A person accepted a job offer from an employer that pursued said person. Person accepted job offer, passed background check, passed medical tests, put in notice with current employer, and declined job offer with another prospective employer (based upon agreement to start employment with company that extended offer.) Has documentation showing date of hire, start date, which building to report to etc, money days until agreed upon start date. The prospective employer calls and says the job is no longer available and the person is now out of a job. Is this a case where promissory estoppel applies?

Asked on August 25, 2011 Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

From what you write, this may well be a case where promissory estoppel applies. The key issue would be if the employer who has withdrawn the job offer knew, or should have known, that the prospective employee was quitting an existing job or that he turned down a different offer (if they knew or should have known of both, even better). The elements of promissory estoppel, aka detrimental reliance, are 1) a promise which it was reasonable rely on; 2) reasonable reliance was put on that promise; 3) in reasonable reliance, the person changed his/her position to his/her detriment; and 4) the promissor knew or should have known at the time they made the promise that it would be reasonable for the promissee to change his/her position, in reliance on the promise, to his or her detriment.


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