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What Is an Offer Letter?
An offer letters, also known as a job offer letter, is a formal communication that establishes an agreement between an employee and employer. The employer sends the employee an employment offer letter that includes the terms of hire. These terms typically include title, pay rate, benefits, and stipulations.
Since an offer letter meaning and laws can vary from state-to-state, ensure that you speak with employment lawyers when using them during the course of your business.
Here is an article about offer letters .
What’s Included in an Offer Letter?
An offer letter is more than just a formal way to let someone know that they were hired. It also serves as a legal record for the prospective employee and your company. Ensure that you put the correct information when drafting an offer letter.
These are the items included in an offer letter:
- Job details, including responsibilities, duties, hours, and travel requirements
- Indication of whether the position is full-time, part-time, exempt, non-exempt, or contract
- An acknowledgment that the letter is intended for offering a job
- Salary offers and information about the pay cycle, bonuses, and commissions
- Benefits that the employee will have, including health insurance, retirement, vacation, employee stock options , and paid time off (PTO)
- Listings of any limitations and conditions of employment, such as a background check, credit check, or drug screening
- How to handle employment termination, including a noncompete agreement , resignation letter request, and a severance agreement
- Explain how the prospective employee can sign and return the letter to formally accept the terms in the offer letter
- Close the letter with information about how the prospective employee can reach you with questions or concerns.
Some industries and businesses may want to include additional information as relevant in their offer letters. If you need legal advice about writing offer letters in your organization, employment lawyers can help you address any question you have.
Here is an article about what’s included in an offer letter .
Purpose of an Offer Letter
The primary purpose of an offer letter is to offer a job to an employee. However, they also offer other unique advantages to both the employer and employee before beginning a working relationship.
Below, there are numerous purposes an offer letter provides, including:
- Purpose #1: Establish the terms of employment
- Purpose #2: Create a paper trail of an employment offer
- Purpose #3: Give the prospective employee a chance to think about whether to accept or reject the role
- Purpose #4: Set the expectation of both the employer and employee
- Purpose #5: Act as a springboard for an employment contract negotiation
There are other advantages associated with an offer letter. Poorly crafted offer letters can have the opposite intended effect on employers. Take the time to learn about how to write an offer letter so that you do not make this mistake with your business.
Image via Pexels by Valeria Boltneva
How To Write An Offer Letter
Ensure that you understand how to write an offer letter from start-to-finish. Doing so helps you include all relevant details and avoids any critical steps when hiring an employee. It will also establish a repeatable process that you can use for future hires.
These are the steps for writing an offer letter:
- Step #1: Start by identifying the employer’s name and sender’s title at the top of the page.
- Step #2: Open the letter with a salutation to the job seeker and congratulate him or her.
- Step #3: Include key details about the job, including the title, main duties, start date, compensation, and name of the employee’s manager.
- Step #4: Leave a blank signature and dateline for the employee to sign.
- Step #5: Provide a date of offer expiration in the letter.
- Step #6: Give instructions for how the employee can return the signed letter.
- Step #6: Conclude the letter with your name, job title, and contact information.
- Step #7: Obtain company approval to send the letter.
- Step #8: Send the letter to the employee via email or postal mail.
- Step #9: Answer any questions or enter into negotiations with the employee.
- Step #10: Begin formalizing the hiring process when the employee signs the letter.
Here is an article about creating an offer letter .
Example of an Offer Letter
If you need an example of an offer letter, you can generally find a template on Microsoft Word or Google Docs. They can provide a great starting point for you to gather ideas. It is critical to remember that these templates are not customized for your situation, so they may lack key elements.
You can also do a Google search for offer letter examples. Again, you will run into the same situation as Microsoft or Google templates in terms of customization. However, you will be able to find additional options and information regarding offer letter examples through internet searches.
Here is another article featuring examples of offer letters .
Is an Offer Letter a Legal Document?
Offer letters can be a type of legal document. However, they are less formal than an employment agreement or employment contract . Also, employers are under no obligation to send an employment offer letter to new employees.
While even a simple offer letter or offer letter email offers flexibility, it is imperative that employers carefully write them since they can unknowingly become legally-binding instruments. As such, employers must review a proposed offer letter with labor lawyers before transmitting them.
By developing a standardized offer letter template, your organization can avoid making legal mistakes. Your labor lawyers can also create a boilerplate agreement that avoids creating a legally-binding agreement inadvertently. A breach of contract can result in serious employee disputes in the future.
Getting Help with An Offer Letter
While an offer letter may appear to be a simple document, it is essential to remember that it serves a legal purpose. As such, it is critical to draft and execute an offer letter that makes your employee feel welcome to the team while not missing any key details. Doing so may help your company avoid legal disputes in the future, mainly if you write the document with employment lawyers.
Getting help with an offer letter from employments lawyers will benefit your organization in several ways, including:
- Receive legal advice on current and ongoing employment decisions
- Allow someone to handle employment offer letter negotiations on your behalf
- Ensure that all critical components of an offer letter and all employment-related documents comply with local, state, and federal laws
- Answer questions regarding compensation, benefits, and retirement packages
- Keep you informed of employee classification and types of employment rules as they related to offer letters
- Represent you in civil or administrative court proceedings and hearings
- Interpret legal jargon in communications that an employee or their lawyer sends to you
- Prevent any conflicts between employee handbooks and offer letters
- Draft additional employment contracts and agreements as necessary
Many of the above-referenced issues are challenging for many reasons. Instead of leaving your offer letter to best guesses or boilerplate templates, get a customized document from labor lawyers. They will ensure that it accounts for every key legal issue that matters to your business and relevant laws.
Need Help from Labor Lawyers?
If you need help from labor lawyers in your state, post your offer letter project to ContractsCounsel. Start receiving proposals today at no cost!
Meet some of our Offer Letter Lawyers
Brandon is a Texas Super Lawyer®, meaning he is among the top 2.5% of attorneys in his state. He has designed his practice to provide a unique ecosystem of legal support services to business and entrepreneurs, derived from his background as a federal district law clerk, published biochemist, and industry lecturer. Brandon is fluent in Spanish, an Eagle Scout, and actively involved with the youth in his community. He loves advocating for his clients and thinks he may never choose to retire.
Firm rated best ADR firm for Wisconsin and won an award for cultural innovation in dispute resolution from acquisition international magazine in 2016 and it was rated "Best of Brookfield" by Best Businesses in 2015. Attorney Maxwell C. Livingston was rated 10 best in Labor & Employment Law by American Institute of Legal Counsel and 40 Under 40 by American Society of Legal Advocates for 2016; he also won 10 Best by American Institute of Family Law Attorneys. He is licensed in Wisconsin in all state and federal courts, and in the 7th Circuit Court of Appeals, wherein he won a landmark decision in McCray v. Wielke.
Richard is a wizard at taking on bureaucracies and simply getting the job done. His clients value his straight-forward counsel and his ability to leverage a top-notch legal staff for efficient and effective results. Richard is a professional engineer, professor of law, and has been named among the top 2.5% of attorneys in Texas by the Super Lawyers®. When he is not driving results for his clients, Richard can be found with his small herd on his Texas homestead.
Experienced attorney and tax analyst with a history of working in the government and private industry. Skilled in Public Speaking, Contract Law, Corporate Governance, and Contract Negotiation. Strong professional graduate from Penn State Law.
I am an attorney admitted in NY, with over 6 years of experience drafting, reviewing and negotiating a wide array of contracts and agreements. I have experience in Sports and Entertainment, Real Estate, Healthcare, Estate Planning and with Startup Companies. I am confident I can assist you with all of your legal needs.
Rishma D. Eckert, Esq. is a business law attorney who primarily represents domestic and international companies and entrepreneurs. A native of both Belize and Guyana, she remains engaged with the Caribbean community in South Florida: as a Board Member and General Counsel for the Belize American Chamber of Commerce of Florida, and Member of the Guyanese American Chamber of Commerce. She holds a Bachelor of Laws degree (LL.B.) from the University of Guyana in South America, a Master’s degree in International and Comparative Law (LL.M.) from Stetson University College of Law in Gulfport, Florida, and earned a Juris Doctor degree (J.D.) from St. Thomas University School of Law in Miami, Florida. Licensed to practice in the State of Florida and the Federal Court in the Southern District of Florida, Mrs. Eckert focuses her passion and practice on domestic and international corporate structuring and incorporation, corporate governance, contract negotiation and drafting, and trademark and copyright registrations.
Mark A. Addington focuses his practice primarily on employment litigation, including contractual disputes, restrictive covenants (such as non-competition, non-solicitation, or confidential information restrictions), defense of wage and hour, harassment, retaliatory discharge, disability, age, religion, race, and sex discrimination.