You’ve hired someone new. Full-time role, offer made, start date agreed, everything sorted. You’ve emailed them their contract and first-day instructions. The business is growing, things are busy, and you’ve been waiting patiently through their notice period on their current job.

And then, just before they’re due to start, you get a message: they’re in hospital. Recovery time? At least 28 days. Possibly longer.

No signed contract. No first day. No idea what’s really wrong.

Now what?

Verbal offer and agreed start date = legally binding contract

Let’s start with the basics. In employment law, a contract doesn’t have to be signed to be binding. If you’ve made a clear offer, the employee has accepted, and a start date is agreed, you have a contract.

Even if they’ve not yet stepped into your office, logged in, or done a day’s work – they are technically already your employee. That matters, because it means that any decision you take from this point needs to be treated as if they’re already on staff.

Can you terminate the contract before they start?

In theory, yes. You can terminate a contract before someone starts. But in practice, it can be legally risky – especially where the reason they’re not starting is illness or injury.

If you terminate now, it would count as a dismissal. If that dismissal is linked in any way to the person’s health, or even if it could be perceived as such, you may be walking into a discrimination claim.

Under the Equality Act 2010, employees are protected from discrimination because of disability – and that protection starts from day one. In fact, it starts before day one. You don’t need to have worked a day to bring a discrimination claim.

Even more tricky: if there are signs that the illness could be more than temporary or minor – for example, mental health-related or a serious condition requiring hospitalisation – then it’s very possible that it would fall under the legal definition of a disability.

What are your options?

You broadly have three routes. Each carries its own mix of legal risk and practical challenge.

1. Hold the job open

This is the safest option from a legal perspective. You allow the employee to recover, and you honour the existing employment contract. If the delay becomes prolonged, you can revisit the situation and potentially review things further down the line.

That said, for small businesses or seasonal roles, this isn’t always commercially viable.

2. Agree a delay or mutual release

You can contact the employee and suggest delaying the start date until they’re fit to work. That’s a reasonable and often well-received approach.

Alternatively, if it becomes clear that they’re unlikely to be able to take up the role in a reasonable time, you could propose a mutual parting of ways. This must be handled delicately, and it’s worth taking legal advice to avoid any suggestion of pressure or discrimination.

3. Terminate the contract

This is the highest-risk option. Even if you say the reason is due to business need or operational urgency, if the timing suggests a link to the person’s illness, there could still be legal consequences.

To reduce risk, you’d need to be able to show that the decision was based solely on legitimate business grounds and that it had nothing to do with the employee’s health. Even then, it may not be worth it unless all other avenues have been explored.

Final thoughts

This sort of situation happens more often than you’d think. A new hire falls ill, and suddenly you’re stuck between being a decent human being and trying to protect your business.

If there’s one takeaway, it’s this: even unsigned employment contracts can carry real legal weight. It’s always worth getting advice before taking action, especially when health or disability could be involved.

Whether you’re facing a similar situation or just want to check your hiring process is legally watertight, it’s a good time to review how offers are made and documented. A little caution now can save a lot of trouble later.

These kinds of tricky employment questions come up all the time – usually when you’re already under pressure and just need a straight answer, fast. That’s exactly why clients take out one of my VIP Legal monthly subscriptions or HR pack. It gives them same-day legal support, whenever they need it, without worrying about the clock ticking. If you’d like to know more about how it works, just get in touch.