Can you reject an offer letter you already signed?
A friend of mine was actively looking for job recently and just few days ago, he told me he finally got an offer. And he has signed the offer letter.
I was happy for him but few days later, he told me he got another job offer which is much better in terms of pay, benefits and prospects.
And he started to worry because he has signed the offer letter. Can he still join the new company? Fortunately for him, the notice period for his new job (under probation) is 24 hours. What if it’s 1 month? I’m sure some of you might have encountered such situation before.
I’ve talked to few of my recruiter friends and even my HR who is a good friend of mine. They said that the new employee can choose not to turn up at all even after signing the offer letter. They have experienced many incidents such as this. The company does have the rights to file a lawsuit against this new employee since he or she has already signed the offer letter.
However, most companies will not pursue this. They will not spend time and money to sue one person which don’t turn up for first day of work. Furthermore, involving in a little lawsuit with a new employee who failed to turn up, is just a petty issue. It might actually ruin the company’s reputation.
I must admit though that I cannot guarantee all companies will behave like this. Maybe there are some companies which will pursue this case though I yet to know any.
That’s why the best solution which I can think of is to call the company up and explains. If your the HR of the second company knows, maybe you can ask them for advice. If they don’t, just call the first company and explain. If things don’t go well, you can either let the second company knows (and hoping they will help you) or you will just have to let it go and turn up for work in the first company.
Unless you are willing to take the risk of not turning up without informing.
But either way, you will most probably get blacklisted by the first company for at least a few years (either you resign within 24 hours or not turn up at all). Companies don’t tend to blacklist a new employee forever for something such as this. They will not be bothered too much with it, not for that long anyway.
To summarize everything:
- You signed offer letter from company A.
- You get a better offer from company B and decided to join.
- You should call company A to explain. If they are okay, good.
- If they are not okay, call company B’s HR and inform them. See if they can help you. This is the last resort.
- If company B refuses to advise or help and company A refuses to back off, you have to let go of company B.
- All the above don’t apply if you are willing to risk it and don’t turn up for company A. Just be prepared to face the consequences of being in a lawsuit (though the probability is very very very low, it is still a risk).
That’s why I always tell people not to sign the offer letter until the very last minute. However, things don’t always go the way we want it to.
And at the end of the day, the question will be, are you willing to take the risk? Is the new offer good enough for you to take the risk?
Hope it helps.
A letter of offer is not the same as a contract for employment. In most countries it illegal to tie someone to the terms of employment without having them sign the actual contract. Maybe that’s the real reason why companies don’t bother to pursue no-shows.
This offer of employment letter is actually for the good of an employee in transition. Without it, one is not supposed to resign from current employment. Thus this document should not be treated casually by the employee. In the event of a no-show, the damage to the company doing the hiring is only minimal at worst. But it’s better for the employee to settle the issue amicably with the company if he turns down an offer after signing it. Normally this is easily settled because most companies allow you to report for work with the signed letter at the same time. So, if you turn it down, all you need to do is give them a call to decline the offer. For courtesy’s sake, never leave the HR person waiting in vain for you to show up…
Actually, rejecting an offer letter that already signed is very very bad. Especially not turn up on the first day. If you’re unfortunate, the employer might tell other company to boycott you. Scary.
Horizons last blog post..Know Your Investment – Part 1
@ Damien
I think in Malaysia, we’ll get an offer letter to sign and that will be our employment contract (with all the clauses, benefits, bla bla bla). As far as I can remember, there’s only 1 which we need to sign. The rest of the doc are quite standard and will only be given to you on your first day. Those don’t require any signature.
Correct me if I’m wrong, but that’s what I can remember.
@ LC Teh
As for the small companies with petty bosses, one wonders what will they do if someone really reject their offer letter for a role which they are very desperate to fill.
That’s why big companies won’t really go after you if you call them up nicely and tell them you have another offer. Even if you don’t show up without informing them, they won’t go after you but it’ll be quite bad for you. The HR people might remember you.
@ Horizon
I think companies will not be bothered to do that if they’re big. Just too much effort to spend on a small ant.
This is where the tough decision arise… but it usually happen. Anyway, have to handle with care otherwise you will lose two offers.
TZs last blog post..Nite out @ Hard Rock Cafe
@ TZ
Don’t burn the bridges if you can.
Yeap. Handle with care and handle with utmost politeness.
I agree with your approach.It is always better to call the company and explain. Generally it is advisable not to turn down the offer once you signed it. It doesn’t show your professionalism.
Having said so, I rejected one signed offer before when I just graduated. That company “bond” me for 1 year before even I start working. What a crap? But at the same time, I also get another offer.
ChampDogs last blog post..Be Careful When You Resign
@ ChampDog
Sometimes, the other offer is too good to turn down and sometimes, good offers tend to come in later than the not-so-good ones since they’re not THAT desperate. Just make sure you don’t go begging for job with the first company next time. hahaha.
But I think, if you explain properly and nicely, they won’t mind that much.
Just be professional.
My first job also tied me for 6 months. LOL. And 2k pay, without EPF, and they can sack me within 2 weeks.
Well, this is exactly my situation.
Company A – small company
Company B – big company
I signed with ‘A’ already and I got offer with ‘B’ after that. Told company ‘A’ I won’t be joining them, wrote a letter but they got really angry and do not accept it. They want to pursue with lawsuit against me if i did not join on 1st of March 2009.
I actually checked with a couple of lawyers and they confirmed according to the offer, there is nothing legally wrong with my action but it still worries me.
Your explanation seems like this company A will sure win a legal suit against me.
@ Worry4nothing
Are you sure those lawyers are saying the truth? The thing is in Malaysia, most employers wouldn’t care the least but a signed offer letter is indeed a signed offer letter, with black n white proof.
If the company decided to take legal action against you, I’m afraid you are on the losing end but then again, I’m not a lawyer.
Well you can always join them for 1 day and resign on the first day, and tell the new employer that you have to delay joining them by 1 or 2 weeks. Most notice period during probation is 2 weeks.
Hi Alvin, thanks for the advice.
I already made my choice more than a month ago, and sufficiently informed company A regarding my intention not to join them. What you advice is logic as well as the lawyers advice. Plus, those lawyers already read my offer letter and they confirmed that as long as I informed ‘A’ and not coming on the 1st day, there is no loss to the company. Thus, no legal action.
I chose to proceed to company B as I already informed company A sufficiently, but the risk is still there. I’m preparing myself for any legal action now and willing to fight until the end for my rights.
As I am quite sure there is a lot of people like me out there, I’ll update this post from time to time on any legal proceedings that I may face in order to inform Malaysians what to expect in this kind of situation.
Wish me luck!
@ Worry4nothing
I really doubt that company will take action on you and by saying they will, they are actually making a bad name for themselves. Also, it’ll be more expensive for them to take legal action 
No worries.
All the best
and do feel free to use this area to update your situation. That will be able to help a lot of people in similar situations 
It’s kind of confusing; my company have offer letter for every new company to sign, after that the real agreement between employee-employer called the appointment letter. It is necessary and why not just either one of them is enough?
Sorry i meant every “new employee”…
@ Remus
Yes, that is normally the case because you cannot tie a person down with just offer letter. When the person starts work only it can be considered official – thus the employment letter. It’s different.
So legally speaking, the person can actually reject a signed copy of offer letter but not a signed copy of employment letter. UNLESS, the offer letter itself states certain things about turning down the offer will result in legal issue, bla bla bla.
Otherwise, it’s safe to reject offer letter. Just be prepared for the blacklist and tonnes of scolding/threats.
Hi All,
I’ve been meaning to update my case for a while now. Sorry for the late info. You can refer to my previous posts for the whole story.
Company ‘A’ proceed with sending me a ‘letter of demand’ from their lawyer. They demand me to pay a certain amount according to their offer letter plus the legal fees. Please note that it is a letter of demand, not legal action or ’saman’ as we call it here in Malaysia.
It contains all the lawyer threats that say you can even be bankrupt! Seriously, bankrupt because you do not want to work? 
Letter of demand must be reply to the lawyer in order to clarify anything with them. You can either reply it yourself or assign a lawyer to represent you and reply it on your behalf. I chose to assign a lawyer. They reply on my behalf by clarifying the things in ‘letter of demand’ (LOD). DO NOT, I repeat DO NOT clarify anything not in the LOD. It will make things worse. It’s been a while now and still no reply back from their lawyer.
Best case scenario, the company A just let go. Not so best, they proceed with legal action. According to all the lawyers i’ve met (Govt and Pvt), this will go to Industrial court. If this is the case, I have 2 choices. 1. Proceed with the current lawyer but it will cost a lot. 2. Go to Labour Department and get a lawyer, for free. Never the less, if the not so best scenario comes, i’ll choose option 2.
I’ve prepared my documents (offer letter, LOD, my reply letter, etc) and all the lawyers I’ve met already read them and they say, the company actually do not have a case. LOD is standard operating procedure.
The key is, as long as in the offer letter do not say you need to pay if you do not want to come before the start date, there is nothing you need to worry about. As long you do not report on the first day, there is no liability to the company. Unless the company can proof that by not joining them, they actually making a loss, there is no case to demand a payment. Even if they do, it is not your problem.
The conclusion is, the Law is on our side. The contract/offer letter must be fair to both parties. Just make sure you can get all the legal needs you can because, this is a legal issue. Labour Department, Damansara is the place to be to clarify your issues. They give consultation and legal help for free.
I’ll update when there is something to update. If not, just take this as the Best case scenario.
@ Worry4nothing?
Whoa, thanks for the tips. They certainly help a lot of us here. Actually, I’ve told some people before that as long as there’s no black n white, they have nothing to fear. But I would advise them to give a call, just to be nice and avoid being blacklisted for too long.
Anyway, really thank you for sharing your valuable experience with us here.
One question though, I thought the legal department only helps people in lower income group?
1. Is the letter of employment same with offer letter or it is employment letter?
2. I have signed this letter but I just faxed back to them so do you think it is still legal?
Thanks
sorry, I mean offer of employment not letter of employment.
Thanks for your help
@Ray
Ok, as far as I know, offer letter is to offer the job to you. Something like a ‘promise’ between the company and you. Once you report for work, there should be another form to fill up your details and also your signature. That should be the employment form. I can’t be 100% sure since every company has different policy. It’s better to check with your recruiter or headhunter or the hr itself.
For offer letter, it is legal since you’ve faxed it back. You can dispute or argue bout it…but that will be quite bad for your reputation.
Worry4nothing?…I am having similiar case as per yours and worse of is that i only inform them one day before.
The boss replied that he respect my decision but would like to meet up with me for my explanation.
During the meet up, he acted nicely but he also shared that it is already out of his control and the board may want to take lawsuit against me…
After few days of no news from them, today, they called the headhunter and this worry me again.
Can you please give me the contact of the lawyer you used before…..
Many thanks
@Max
Don’t understand why some companies want to go to this extent. Well, how long is the notice period during probation period? 24 hours? 1 week? 2 weeks? If they are so desperate, the last option is to turn up and resign on the spot. Also, a friend told me that one is automatically terminated if one does not turn up for 3 days consecutively (you might want to verify this with the lawyer).
But still, I don’t see any reason why a signed offer letter can trigger any legal action against you. Perhaps it’s just to scare you off.
Anyway, there’s no bond or any contract besides the offer letter right?
cause they are the local company….the notice period during probation period is 1 month…
Indeed, when i emailed the boss on my final decision, he replied with SMS that he respect my decision and i own him a good explantion. I am not too sure if that SMS of “respect my final decision” can be used as a confirmation for me withdraw my acceptance of offer.
That’s why i am hoping to get the recommendation of laywer from Worry4nothing as he has a similiar case as mine…
Many thanks.
@Max
have u considered calling the labor department about this? also, ur contract or letter of offer, does it have any clauses which will allow the company to take legal actions against you if you do not turn up for work? read the terms and conditions properly.
worry4nothing, erm…i not sure whether he will check the comment box here.
but for SMS, it’s not really a valid ‘proof’. so you might want to find other options.
I thnk the labor department only handle cases with salary below RM1,500.
My letter of offer does not stated any clauses on legal action liability if I rejected the offer after signed or dont turn up at work.
Why SMS is not a vaid proof if it is from his handphone number…?
@Max
well, i’m not a lawyer but for me, i wouldn’t take a SMS for granted.
labor department only protects those under 2k or 1.5k. but u can always ask them in terms of labor law stuff. no harm asking.
actually i don see any harm, to be honest. i think its jz empty threat. but that’s me, you should just ask someone from the legal side.
Do u have the contact number of Labour department?
@Max
i think u can try to Google for it. I found another blog post with some information, it’s in my other post – http://blog.alvinlim.info/2009/04/09/can-a-company-stop-you-from-resigning/
you can try that
Thanks
@Max
No problem
hi all,
Sorry for no update in a while. In my case, it seems they gave up already.
As for Max, i suggest u contact the labour dept first. Don’t worry too much. And don’t talk to the company a lot, u might reveal info that can go against u. They can’t sue u bcoz this is under labour, which go to industrial court. Thay can demand u to pay only but u are ok since there is no way for them to prove a loss. They never paid u anything, right?
Be strong. IC is a court based on fairness, i heard a case previously a guy went to a training paid by the company. He quits right after that. Co go to IC and win. But, the guy said that he cant pay in lump sum and can only pay rm50 a month. IC agreed. So, the company received rm50 a month only. Worth the trouble? Hahaha…
@worry4nothing?
Thanks for sharing your knowledge and experience here. Yea, most companies don’t have the time to go through the ordeal unless they really have nothing better to do.
Worry4nothing, thanks for the information.
May i ask how long did they take to send you the letter of demand?
As for my case, because i am dignosed with Panic Attack and with medication, simple thing will worry me a lot.
I have also consult some laywer dealing with employement law…they said the employer have the right to demand for thier lost “minimum” for one month salary as it is stated in the employment letter of one month notice during probation period or either pay off-in-lieu….and of course they can demand for other losses too which it’s difficult for them to prove as per what you have said.
As it is really makes me uncomfortable for things not settle and have closure to it….
Which lawyer you used for reply the LOD to them?
Do you mind if i talk to you personally??
Your help is very much appreciated…
Hi alvin,
I am going to turn down the offer which i have already signed. But it is not becuase of the 3rd company, it is my current company. I resigned somewhere in 13th Jan, but the negotiation with my current boss went on for 1 week plus..at first i have decided to move on (and i though i will stand firm on my decision) but on monday, he proposed a better offer and i decided to stay. Now i am thinking how should i handle the new company. As this was introduced by a headhunter, do you think i should send a mail to HH first or directly call the new company? I do not wish to offend any one of them, and if unavoidable, keep it to the min. Btw, reporting date is on 15th of april.
Please advise. Thank you.
@tcs
some of the offer letters will have things like paying the losses if you fail to turn up, bla bla bla. so you might want to make sure your contract does not have that. also, it’s better to talk to the headhunter but don’t expect them to be polite la. same goes to the new company.
anyway, i don think one should ever remain in the same company after being counter-offered. i feel its quite bad for you coz people will think of you as money-minded. if it’s career prospect and promotion, then different story.
I think as long as it is not stated in the offer letter, legally it should be fine. This is something common and happen all the time.
As for whether want to take the counter offer, I think it depends on your real objective why you want to leave the company. If it is $, then the decision is very clear.
ChampDog´s last blog ..Malaysia 2010 Budget – What should I do with it?
@ChampDog
Yeah, it’s its about money, and you don’t mind people looking at you that way, then counter offer is a good option to consider.
hey i have not signed any appointment order,they have couriered me the appointment order and asked me too fill it up and send it back……i have not signed any papers.and i have not sent the appointment order…..will they do anything against me…..
@iyyappan
I seriously doubt they can do anything since they don’t have your signature. There’s no black and white and you’ve only given them your verbal agreement.
tcs, you have to inform the head hunter fast in order to minimize their anger as your reporting date is on 15th APR so that they still have enough time to look for the replacement….be decisive, otherwise, things will get worse…
Legally, once you have signed the offer letter, it is already consider as a binding contract and the new company has the legal right to ask for compensation based on the clauses stated in the employment letter. But if you inform them earlier enough, they wont waste their time on you..
Be brave and face it..
iyyappa, dont worry, as long as you have not sign the offer letter, you DO NOT hold any legal liability because the contract has not been accepted, hence it is not binding.
@Max
Once you’ve signed the offer letter –> this depends on whether there’s a clause in the offer letter which allows the company to take legal actions against you. Some companies do not have such clauses. But still, it’ll be better to inform them earlier.
This topic seems like very hot.
I think usually it is not written down in the letter and in fact I have never seen one that written down this in the offer letter. I think it is more about your reputation to the hiring manager.
ChampDog´s last blog ..Understand Money as Debt Concept
@ChampDog
i’ve seen one before. that’s why i know it exists. LOL
Hi Alvin,
I read on your advise/opinion that a staff shouldn’t take the counter-offered by the boss as it will look bad on the staff. How if the staff already resigned from the company because of not agreeing a sudden rule of the company, a week later, the boss is still asking the staff to re-join the company by not impose that particular of rule on the staff (which is being agreed confidentially between the boss and the staff). Then should the staff re-join the company?
@confuse
Is there a black & white between you and the boss stating that you’re exempted from this new ruling? If yes, what will other colleagues think once they found out? And how much can you trust your boss for not going back on his words?
There’s no black and white but just based on trust. No doubt the trust is only 50-50. If the boss accidently leak out, it will look bad on the boss of being not fair (other than the rule, she will pay extra allowance). Again, if the boss didn’t do as what she promise, might end up resign again.
@confuse
well, it’s really up to you. i will never go back to the job which I’ve resigned from (not in 3 years). because i usually take a very long time to consider bout resigning or finding another job. Once decided, I won’t turn back.