Signed a contract with FAANG. One month before that, I signed a letter of intent with another, smaller company, that I intend on signing a work contact with them in few months. They wanted me to sign a version of the letter of intent that says that I grant them exclusivity and will not be in contact with another company, but I told them I'm in contact with FAANG, and we agreed to remove this clause from the letter of intent. Now, I notified the smaller company that I am signing eventually with FAANG, and now they ask nicely for 4k to compensate for the expenses they had on me. They signal me that if I don't reach an agreement with them, they will try to get it from FAANG. Now the question is: will FAANG cancel my employment contract, because they will found out I previously signed the letter of intent with the small company? Maybe it's a corner they don't want to get into and would prefer terminating me before the start date?
Neither you nor FAANG has any obligation to reimburse them for their recruiting and staffing costs. Don’t let them bully you into thinking otherwise
The answer really depends on what you agreed to in the letter of intent. You entered into a contract, if they relied on that contract and incurred expenses as a result, you can be liable for them. On the other hand, the company contacting your new employer and causing trouble could be construed as tortious interference. You should really talk with your attorney. You won’t get actionable legal advice here. You will want to do this soon. Your new employer could drop you, just to avoid the hassle. Your attorney can review your situation and remind the company to not contact your new employer.
Is this for a contract position or at-will employment?
At will
A contract is something for something. If they gave you something, such as a bonus or training, then you might be legally obligated to fulfill your end of the contract. Otherwise, just breaking a promise to join doesn’t entitle them to anything if they haven’t given you anything. That said, I’m not a lawyer. I just spent some time reading torts.
What State? At Will states cannot penalize for ending employment without notice.
Find a lawyer through a friend of something. Just in case. Also try asking reddit
It's illegal for them to put any kind of non-compete clause in the contract (in CA at least). What expenses are they asking for? What if you had not accepted the job in the first place?