Question

Dear all,

One of the candidates have signed the letter of offer but informed me subsequently that he is unable to join due to his current company 's counter offer after a week. What is the proper action that I need to take? Does he needs to pay any compensation to my organisation?

JK

Reply 1

You can demand but it might not do your organisation any good. The notice period for new staff range from a week to two. If you demand that he pay the notice period’s compensation since he had signed the letter, he might just come as per schedule in order to avoid penalty and tender his resignation on the first day.

HR will be catch in a bigger headache because you can’t have him sitting there for 2 weeks doing nothing, and yet it would be a waste to issue him computer and give him basic training knowing that he is leaving in a few days. End of the day, you still end up paying him salary for doing nothing at all. If he is through an agency, you can lodge a complaint against this candidate and demand a replacement. That would benefit you more.

SS

Reply 2

Company will need to move on and fall back on next best candidate. So long as he/she had not started work, he/she is not liable to serve/compensate the notice period.

CK

Reply 3

If candidate has signed Employment Contract, employer has the right to ask for salary in-lieu of notice legally depending on how stringent they are as they could have replied other candidates who were unsuccessfully selected.

Jl

Reply 4

MOM website states:
If a new employee has signed a letter of employment but does not show up for work, what can an employer do? The Employment Act does not apply until the employer-employee relationship has started. If you’re an employer, you won’t be able to claim notice pay or any other compensation under the Employment Act in this case. You can consider a civil claim filed through your own lawyer.

Rose

Reply 5

You can wish him all the best in his company, and he can contact you anytime if he is keen to explore further opportunities with your company. You can't ask him for compensation as he has not started any work with your company. What you can do now is to find another candidate.

YP

Reply 6

MOM website states:

".....You can consider a civil claim filed through your own lawyer."

Depending on how critical the role is, but in my opinion a civil claim may not be worth your time and energy. You may just proceed and start to hire another candidate.

Maria

Reply 7

Under MOM labour law If the candidate has not commence work, it is consider No Contract. Said candidate is not an employee of the Company even though he has signed the appointment letter. No action can be taken against the candidate for failure to reporting work.

Should the company wishes to take legal action, may go through lawyer to sue for the losses which the company has incurred. This is, however more to those holding higher and senior position. Hence, it is advisable to measure the cost of losses before you make decision.

Season

Reply 8

I have encountered numerous times this same scenario and this is not uncommon I am sure with other companies too. I know it is very frustrating but at the end I am not going to waste my time and energy pursuing this matter. I did once by sending a registered mail and informing the employee that we are going to take legal action if she does not turn up for work as she had already signed the appointment letter and then serve us the notice period according to the terms. This was meant to 'frighten and teach her a lesson' but she did not turn up on the suppose start work date! After this incident, we just accept if this situation arises and move on.

Munjit