What can job seekers do to protect themselves from rescinded job offers?

If you're not in a position to have an employment agreement, you need to feel confident that there will be a job for you at your start date. Do as much research and ask as many questions to determine whether the company will revoke job offers. If there's a concern that your job won't be there, that should factor in to your decision to accept the offer. Get as much information as you can when you're making the decision.

From a more practical standpoint, candidates who are offered signing bonuses upon being hired should make sure that they will still be entitled to those bonuses if the job offer is rescinded. Negotiate to have that included in the job offer letter. Some people use that as protection: If they're getting a $10,000 signing bonus, they have some cushion from an economic standpoint if the job offer is revoked.

Similarly, if someone is going to be relocating from Seattle to Chicago, I would advise that person to make sure their relocation package will be covered, paid for and accepted even if the job offer ends up getting revoked or if the company determines after six months (or however long) that they don't need the person anymore.

Executives can ask for an acceptable amount of severance should the job be revoked prior to starting or should it go away during the first whatever many months provided they are not terminated for cause (embezzling, theft, sexual harassment).

People can try to negotiate some of those things like signing bonuses and relocation costs if in fact they feel the offer is a high risk [of being rescinded]. There are some employers who realize it is high risk in these economic times, and because they need certain employees, they're willing to take on some of that risk.

What questions should prospective employees ask a company to determine whether the job for which they're applying is at risk of disappearing?

How many people are currently in the department? How many people have been in the department over the past few years? Are they hiring more people? For what positions? Why?

Also ask, Is there a risk from the employer's perspective that this position may be eliminated or that this particular portion of the business may decline? If so, would there be a position for me elsewhere in the company?

I would also ask about the employer's track record of rescinding job offers. Have you had to rescind any job offers over the last two years? Why? If they had to rescind job offers, what, if anything, have you done for those individuals whose job offers were revoked? Some companies will provide a stipend for a period of time to candidates whose positions were eliminated so that they can look for another job. Some companies will help the person look for a new job. Some companies will delay the candidate's start date for six months (if it's production workers) or offer them part-time work for a certain period of time.

When in the process should prospective employees ask these questions?

After the offer has been extended and while the prospective employee is considering whether or not to accept the offer and during any negotiations regarding moving expenses/a signing bonus. I call this the "post-offer/pre-acceptance" period. Such discussions during the interview process would be odd, as well as a bit presumptuous.

Next: Can the candidate sue?