What Is a Conditional Offer of Employment?

If you want to remain competitive in any industry, you need to hire top talent for your most important positions. To do this, you need to act fast. When you find one of those few golden employees, don’t wait too long to send them an offer. Another company may intrigue them before you get a chance.

But you never know what kind of candidates will turn up in a stack of resumes. With the technology and resources available today, it’s easy for candidates to fake their credentials and misrepresent themselves. One candidate might ace an interview and pass a quick social media check, but turn out to be horribly incompetent (or dangerous) once they start working.

Accidentally hiring these people isn’t just a danger to your bottom line — it can even land you in legal trouble. It’s your responsibility as an employer to ensure your company has fair and safe hiring practices. But to remain both competitive and compliant, you need to keep key positions filled with good, sound employees.

A conditional offer of employment is a great strategy to help. By extending a conditional employment offer, you can get a jump on hiring great candidates while allowing yourself enough time to investigate them thoroughly. But a conditional offer isn’t a perfect solution for every situation. It requires a lot of support and a clear hiring strategy.

Let’s take a closer look at how conditional offers of employment work and how you can implement them for better hiring practices.

Conditional vs. Unconditional Employment Offers

A conditional offer of employment is a job offer in which the employer agrees to hire an employee only if certain conditions are met. It’s different from a traditional (unconditional) employment offer in a few key ways:

Typically employers require specific conditions related to the duties of the job. Common examples of conditions include:

• Clearing a background check
• Passing multiple drug tests
• Attaining specific certifications
• Submitting to a physical
• Undergoing a credit check
• Obtaining legal citizenship status

Some companies also use conditional offers to implement a trial or probationary period (usually for the first few weeks or months). During this time, the company can examine the employee further and assess their performance before committing to a legally binding offer. While there are some limitations to the conditions an employer can require (often related to the FCRA and ADA), companies have quite a bit of freedom to extend these offers as they choose.

Conditional Offer of Employment Example

A conditional offer of employment should be written like a traditional job offer, with a full description of the job responsibilities, salary, etc. However, it also lays out conditions that must be met in order for the employee to start work.

For example, you might extend a job offer to a James M for the position of Crane Operator, with the conditions that he obtains a crane operator certification and passes a drug test. James can only start working for the company if he gets this certification (and passes related exams) and his drug test comes back clean.

As another example, you might offer Kelly F the position of school bus driver, with the condition that she submit to a background check, obtain a CDL with proper endorsement, and provide proof of insurance. If Kelly completes all of these requirements, but her background check comes back with questionable results, you may rescind the offer if you choose.

Why Companies Use Conditional Offers

Companies use conditional offers for a variety of reasons, as they present benefits to both employers and employees.

Benefits for the Employer

• More Time: Sending a conditional offer allows employers more time to investigate candidates without committing to a legally binding offer. Especially for high-volume hiring workflows, these are very good when HR managers are strapped for time. Imagine you find a candidate who seems like a good fit, with the right personality and skills. However, you still need to verify a few more credentials. You can send the candidate a conditional offer requiring a background check, which will pique their interest, keep them focused on your company, and allow you to make doubly sure they are hireable. If your offer includes a probationary period, this gives you more time to learn about the employee’s personality and work habits before committing to hiring them.
• Reduced Risk: The extra time afforded by this kind of offer reduces hiring risks. Now, you’ve shown interest in the employee, which makes them less likely to accept another offer. But you can still do a background check, request drug tests, and verify they aren’t a dangerous criminal before you officially hire them. If they aren’t a good fit for any reason, or they refuse to submit to your conditions, you can revoke the offer and avoid a potential disaster.
• Speed: As we said, hiring top talent requires acting fast. By the time you finish checking a candidate’s background, they may have already accepted another offer. Instead, you can send a conditional offer to any candidate that has the qualifications you need without fully committing just yet. In effect, it puts the responsibility on the candidate more quickly in the hiring process, so they focus on fulfilling the remaining requirements, and you (or the hiring manager) can move on to more pressing matters.

Benefits for the Employee

• Sense of Job Security: While a conditional offer is not as solid as an unconditional offer, it’s better than getting denied by a potential employer altogether. It ensures candidates feel they at least have a chance at employment with your company. This is especially important for applicants that are still employed elsewhere. They may not want anyone to call their references (i.e. their current employer) when submitting a new job application. However, if you demonstrate they have some prospect for work at your company, they are more likely to submit to that kind of check.
• Transparency: A conditional offer of employment presents clear requirements for the job description. It details what will be required of the applicant should they start work at your company and a bit about what it takes to be successful in the role. This can inspire confidence in candidates. In some cases, it may also be a legal requirement. For instance, the FCRA requires you to obtain permission from an applicant before doing a credit check. A conditional offer can fulfill that requirement.
• Negotiation: In some cases, a conditional offer allows the candidate more freedom to negotiate salary, job role, and start date. This demonstrates an understanding of the candidate’s autonomy and value as a potential employee of your company. It can be used as an effective part of preboarding and promote lasting engagement.

How to Issue a Conditional Offer of Employment

Any time you offer a candidate a job at your company, take care in how you structure and treat conditional offers. Here are some key elements to consider:

What To Include

Every conditional offer of employment should include:

• The position title and description (with specific duties and KPIs if possible)
• Total compensation for the position (salary, benefits, etc.)
• A specific list of employment conditions and what exactly it means to meet them
• The potential start date (should all conditions be met on time)
• The due date for completing requirements (within the candidate’s control — background checks may take longer)
• The date of revocation if the conditions are not met or no action is taken
• The date or duration of any trial periods stipulated in the offer
• Any relevant company policies or information about company culture
• (Where permitted by law) A specific statement of at-will employment, meaning you as the employer have the right to revoke the offer or terminate the employee “at will” or for any reason.

To ensure proper documentation, it’s best to issue conditional employment offers in letter form. Address each letter to the specific candidate, and list the return address with the hiring manager’s name and your company’s main address. You may also want to have your HR and Legal teams review your letter template before fully implementing it in your hiring process.

Always Get a Signature

No matter how you issue your conditional offer, always obtain a signature from the applicant acknowledging their acceptance of the offer. This provides proof that the candidate at least claimed to have understood the terms of the offer. It may also prevent the candidate from taking legal action against you for unfair hiring practices or wrongful termination, should you choose to fire them or not hire them at all. It also keeps them accountable for the conditions required for employment at your company.

Who To Give It To

While it isn’t as legally binding as an unconditional offer, a conditional offer of employment should only be given to candidates you are fully prepared to hire (if they meet the requirements). Don’t dangle a carrot on a stick. Not only is it rude, but imagine if that person takes the time and effort to fulfill all the requirements of your offer. If you then realize you can’t hire them, you just risked your reputation in your industry with a candidate that may have greater influence than you realize.

Before you send any offer, make sure you are satisfied with the candidate’s qualifications. It’s best to treat it like an unconditional offer in this way. If the candidate met all the conditions of your offer already, would you still want them on your team?

What Happens After a Conditional Offer Is Given?

Once you issue a conditional offer, it’s usually up to the applicant to take the next steps. However, that doesn’t mean your job as an employer is finished. You’ll still want to keep an eye on your timeline. If you really want the candidate to join your team, you may follow up and remind them about due dates, even if it’s simply to maintain their interest.

If your offer includes a probationary period, set up a method for tracking any KPIs relevant to their successful performance. You can decide whether the candidate is a good fit for the position based on hard evidence (rather than your gut feeling).

Once the candidate takes action on your conditional employment offer (or doesn’t), follow up on your agreements as laid out in the letter. If the candidate meets all requirements and has a satisfactory probation period, hire them like you promised. Don’t withhold legitimate employment any longer, as this can be demotivating and unethical. You may also lose the candidate altogether if you don’t take prompt action.

However, if the candidate fails to meet your requirements, you should not hire them — unless they give you a very good reason to extend or alter the agreement. You don’t want to be seen as a pushover in your industry, and chances are those requirements would be important to their success at your company. You also can’t afford to waste resources on a candidate who can’t hold up their end of a bargain.

The Role of HR in Employment Offers

As an HR professional, you play a key part in ensuring your company’s hiring process is efficient, effective, and ethical. Conditional offers of employment can help with this process, but there’s often a lot more to consider.

Ensuring Fair Hiring Practices

When sending any job offer, it’s important to avoid bias. For conditional offers, this means only issuing reasonable requirements and offering equal opportunity to all applicants. Don’t ask someone to provide any information you don’t actually need or make them obtain certifications that aren’t important to the duties of the job.

As part of a larger position management strategy, it's best to list specific requirements for each position. This way every applicant to that position will have the same requirements, ensuring everyone has an equal opportunity. Diversity, equity, inclusion and belonging (DEIB) training can also go a long way in making sure hiring managers avoid bias altogether.

Thorough Investigation of Candidates

A key responsibility of the HR department and hiring manager is avoiding negligent hiring. According to SHRM, a leader in the HR space, “Negligent hiring is a claim that can be made against an employer when an employee causes harm to others and the employer should have known of the individual's potential to cause harm but did not take steps to mitigate the risk (i.e., not hiring the individual).”

In other words, this happens when an employee commits a harmful act against someone at your company and they have a record of doing the same (or similar) acts in the past. If you did nothing to prevent that act (like not hiring the person), you could be liable for damages done to the victimized employee.

For example, imagine you hire Tom Shank without a background check. Suppose after a few months, Tom attacks his coworker Sandra. If a background check later reveals that Tom has a history of assault or similar violent acts, you’ve not only lost two employees (most likely, since Tom was fired and Sandra probably quit). But, Sandra could now also file a lawsuit against the company for negligent hiring.

Conditional offers of employment can help prevent this by allowing your company more time to conduct background checks before hiring potentially dangerous employees.

Tracking Employee Performance and Applications

The HR department is often responsible for tracking employee metrics and generating reports related to KPIs. This is especially important during probationary periods. You need a way to quickly set up KPI tracking methods for new employees for clear insight into their performance during their first few weeks or months.

In addition to managing applications and resumes, you’ll need to keep track of all documentation related to that person’s employment, including:

• Required certifications
• Drug test results
• Background check results
• Legal work status

Keep these documents organized and connected to a candidate’s file for proper assessment. It’s also up to HR professionals to order background checks and schedule drug tests during the hiring process. At the same time, you’ll need to communicate with the hiring team and specific managers regarding all of your hiring decisions and thoughts on each candidate.

Doing all of this with a traditional paper or even spreadsheet-based system can be tedious and time-consuming. Consider upgrading your system to help you manage the process better.

Transitioning Applicants to Onboarding

If a candidate meets all the requirements for employment per your offer, the ball is back in your court again. As an HR professional, you’ll need to take quick action to bring them onto the team effectively. That means transitioning them from a stranger in an applicant tracking portal to a welcomed employee in an effective onboarding program.

This can require a lot of paperwork and navigation of logistics. But if you are still working with legacy systems, new employees could easily slip through the cracks or feel unwelcome due to a disorganized process. Invest in technology that streamlines your hiring and onboarding workflow to help top talent quickly become well-acquainted with your workflows.

Streamline Hiring Workflows With Criterion HCM

A conditional offer of employment is a great strategy for acquiring top talent in your industry while reducing your company’s risk of hiring incompetent or dangerous employees. But to implement this type of job offer, manage positions across your organization, and conduct the background checks and drug tests required for employment, you need an HCM powerful enough to handle this level of complexity. You need a flexible solution that can be configured to meet the needs of any hiring workflow.

That’s why we built Criterion — a completely configurable HCM solution designed with HR professionals in mind. With Criterion HCM, you can:

• Aggregate all candidate information, including applications, resumes, applicant questions, interview schedules, and other key documentation
• Request background checks from the same interface where you manage hiring information
• Communicate with applicants and share thoughts with hiring managers in separate threads specific to each applicant
• Send and revoke customized employment offers
• Move approved candidates into onboarding with ease
• Configure and streamline your hiring workflows
• Generate reports to improve your hiring processes and make better decisions for talent engagement

Criterion also allows you to customize onboarding, automate complex payroll, and integrate your system with any third-party software. Discover an HCM that harnesses enterprise functionality through a user-friendly design — backed by a team that cares about your company. Book a demo of Criterion HCM to see how it works.