Conditional job offers can still be binding: what employers need to know
For years, our advice to clients on withdrawing a job offer has been clear and well-founded: if the contract of employment had not yet been issued, the employer could withdraw without giving notice. That position was grounded in section 86 of the Employment Rights Act 1996, which confers statutory minimum notice only on employees with one month or more of service. No service, no statutory notice. No contract issued, no contractual notice. It was a clean, defensible position.
A recent Employment Appeal Tribunal decision has changed the landscape. Going forward, our advice has to change with it.
What the case decided
In Kankanalapalli v Loesche Energy Systems, decided in January 2026, the EAT considered whether a withdrawn conditional offer amounted to a breach of contract.
The Claimant had been offered a Project Manager role subject to satisfactory references and a right to work check. He accepted the offer, provided his references, paid for relocation, and was given onboarding-related steps to complete. Shortly before he was due to start, the employer withdrew the offer for reasons unconnected to the conditions.
The first instance Tribunal held there was no contract, on the basis that the conditions had not yet been satisfied. The EAT disagreed. It found that the conditions in the offer were not conditions that had to be met before a contract could come into existence; they were conditions that would have allowed the contract to be ended if not satisfied. A binding contract had therefore been formed at the point the offer was accepted.
Because the offer letter said nothing about notice, the EAT implied a term of reasonable notice and concluded that three months was reasonable in the circumstances. The Claimant was awarded three months’ notice pay.
Why this matters
The decision turns on a technical legal distinction, but the practical consequences are significant.
If your offer letter says “this offer is subject to satisfactory references”, a tribunal may now find that a binding contract was formed when the offer was accepted, not when the references came back. Withdraw the offer at any point after acceptance and you could be on the hook for notice pay, even where the candidate has not yet worked a single day.
The longer the gap between offer acceptance and start date, the more onboarding the employer has done, and the more the candidate has done in reliance on the offer (relocating, giving notice to their current employer, signing a tenancy), the larger the potential exposure.
A note on our previous advice
Clients who have worked with us for a while may recall being told that an offer could be withdrawn without notice provided the contract had not yet been issued. That advice was right at the time. It reflected the position under section 86 of the Employment Rights Act 1996 and the way conditional offers had generally been treated.
This decision does not retrospectively change anything that has happened to date. What it does is shift our advice from this point forward. Withdrawing a conditional offer without notice now carries a real risk of breach of contract proceedings, and the safer assumption is that an accepted conditional offer can create a binding contract.
What good drafting looks like
The fix is in the wording of the offer letter itself. The offer needs to make clear, in plain terms, that no binding contract is intended to come into existence until all conditions have been satisfied, and that the employer can withdraw the offer at any point before then without notice or compensation.
Vague references to “subject to” conditions are no longer enough. The offer letter has to do the work explicitly.
We have updated our template offer letter to address this. The new wording makes the position clear, sets out what the candidate needs to bring on day one, and gives the employer the freedom to withdraw the offer up to that point without exposure to notice claims.
Download our template offer letter below!
What you should do now
If you are recruiting, please use the updated template for any new offers going out. If you have offers currently outstanding and are unsure whether the wording protects you, please get in touch and we will review them. And if you find yourself needing to withdraw an offer, please speak to us before you do so. The right approach now depends on the wording of the offer letter and the circumstances of the withdrawal, and a short conversation upfront is always quicker than dealing with the consequences after the event.
The law on offer letters has shifted. Our advice has shifted with it. Make sure your paperwork has too.
Give the team a call on 01270 781006 or email [email protected] to discuss your ad-hoc or retained HR support. note on our previous advice!
