And speaking of rites brings me to the curious case of Kankanalapalli v Loesche Energy Systems, which reminds us that the HR rites of onboarding can sometimes unravel.

Mr Kankanalapalli applied to Loesche Energy Systems for the position of project manager and, following an interview process, he was offered the role on 23 September 2022.

The offer letter specified a start date of 1 November and stated that employment was “subject to receipt of satisfactory references, a right to work check, and a successful six-month probation period, which would commence on the start date”.

Mr Kankanalapalli was asked to return a signed copy of the offer letter. He was also sent a form for referee contact details and a new starter information form. Accepting the offer on 26 September, Mr Kankanalapalli completed and returned both the new starter information form and the referee contact details form, which Loesche acknowledged on 6 October 2022.

In the same correspondence, Loesche reminded him to email documents confirming his right to work in the UK and stated the need to see the original documents on his first day of employment. Mr Kankanalapalli sent the required right to work documents that same day. However, he did not return a signed copy of the offer letter.

On 7 October 2022, Loesche informed Mr Kankanalapalli that there had been a delay in the “notice to proceed” under the relevant contract, and that the project manager role would not now be required to commence until 3 January 2023. Mr Kankanalapalli was asked to confirm whether this revised start date was acceptable. He did not expressly accept the change. Instead, he replied that he had already booked flights to the UK for himself and his wife, and sought clarification as to what payment he would receive for November and December, during which he would not be working.

On 11 October 2022, Loesche emailed Mr Kankanalapalli again, referring to the delay in the “notice to proceed” and stating: “As a result we are no longer able to offer you the contract for the position of Project Manager commencing 1 November 2022.”

No written contract of employment was ever issued to Mr Kankanalapalli. He subsequently brought a claim in the Employment Tribunal for breach of contract, arguing that the offer had been withdrawn without appropriate notice, amounting to a breach of contract. The ET dismissed his claim, holding that at the time the offer was withdrawn it remained subject to the conditions set out in the 23 September 2022 offer letter, namely satisfactory references and a right to work check.

Subsequently, Mr Kankanalapalli appealed to the Employment Appeal Tribunal.

The EAT upheld his appeal. In relation to the offer letter, it held that the ET had erred in its approach to construing the contractual terms. The ET proceeded on the assumption that the conditions in the offer letter were conditions precedent to the formation of a contract, meaning that no contract would arise unless those conditions were satisfied. However, Mr Kankanalapalli had argued that the conditions were properly to be construed as conditions subsequent, under which a binding contract would arise upon acceptance, subject to termination if the conditions were not later satisfied.

The EAT emphasised that whether a term is a condition precedent or subsequent is a question of contractual interpretation in each case, and that wording such as “subject to” does not have a fixed legal meaning and merely signals the existence of a condition without determining its effect.

The EAT found that the ET had failed to engage with Mr Kankanalapalli’s argument that the conditions were conditions subsequent and had not explained why that submission was rejected. This failure to address a central issue capable of materially affecting the outcome amounted to an error of law. The EAT therefore concluded that a binding contract of employment was in existence. Although that contract could be brought to an end if any of the conditions were not satisfied, Loesche did not have an unrestricted right to withdraw the offer for reasons unrelated to those conditions.

The offer letter did not specify any notice period for termination of employment. The EAT held that a term of reasonable notice should therefore be implied, noting that what is reasonable depends on the circumstances of each case and may exceed the statutory minimum under the Employment Rights Act 1996.

Taking into account factors such as Mr Kankanalapalli’s relocation to another country and the length of the recruitment process, the EAT concluded that reasonable notice was three months.

The EAT rejected Loesche’s argument that a shorter notice period should apply during a probationary period, as this had not been agreed or contemplated at the time the contract was formed.

The EAT held that Loesche’s withdrawal of the offer constituted a breach of contract and ordered Loesche to pay Mr Kankanalapalli compensation equivalent to three months’ notice.

This case is significant for employers as it demonstrates that a “conditional” offer of employment may still create a binding contract once accepted, depending on how the terms are properly construed. Employers cannot assume that labelling an offer as “subject to” satisfactory references or right to work checks will automatically prevent contractual obligations from arising, as such wording does not determine whether a condition is precedent or subsequent.

The decision also highlights the importance of expressly addressing termination rights and notice periods at the offer stage. Where no notice provision is included, the courts may imply a term of reasonable notice based on the circumstances, which may exceed statutory minimum periods and lead to liability for damages if an offer is withdrawn.