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How to Draft an Effective Employee Offer Letter

Narendra Kumar

| Updated: Jan 15, 2019 | Category: HR Outsourcing

How to Draft an Effective Employee Offer Letter

Every working employee must be aware of the term offer letter. However, do you know what all is included in the offer letter? Whenever there is an interview process going on, the candidate has to undergo a number of rounds involved in the interview procedure. Once the candidate is selected, the company has to hand over some kind of legal agreement to the prospect employee of a company to seal the deal.

What do you understand by an Offer Letter?

An offer letter is sent to the selected candidates as an extension to the initial verbal offer. It is usually sent before the events such as background check. It is basically an offer for the position, in which the offer letter describes the role of the applicant. It specifies the terms and conditions to be followed by the candidate.

Overall, it helps the prospective employee understands the working of the company and decides whether to accept the proposal of the company or not. Candidates can also take a look at the offer letter and negotiate for the employment rights and duties to be served.

If the candidate agrees to accept the offer, he/she will reply with signing the offer letter. Offer letter doesn’t always seem like a legal binding agreement between the company and a candidate. It showcases the detailed legal protection for both the parties.

It is always considered as a good practice to have a legal professional review of the offer letter, you want to send. This process will ultimately make sure that your organization is protected against legal matters.

Hope you have a little overview of offer letter by now. Further, we will discuss what all is included in the offer letter.

Things to be mentioned in the Offer Letter

Some of you may be thinking that we are working and had received our offer letter from the company. The offer letter actually says more than what we have discussed above.  Yes, you are right if you are having the thoughts.

There are so many things that need to be considered during the execution of an offer letter. Further, in this blog, we will discuss the insights of the offer letter, which one must keep in mind while making the offer letter.

Does the Company Logo on the Legal documents make a difference?

You must use the high-resolution logo of your company on the organization’s letterhead. This signifies the authenticity and professionalism of your company. This will help indulge the potential employee to continue reading the offer letter and consider it seriously.

Date and contact information are essentials, but where do I mention it?

If your company is sending an offer letter to somebody, then keep in mind that the date and contact information of the candidate should be properly mentioned.

You have to mention the candidate’ name, date, and address on the upper left-hand corner like this –

MM/DD/YYYY

Candidate first name and last name

Candidate address

City, state, Zip

I want to write an offer letter, how do I begin? What would be the first line of the offer letter?

If you are on your way of writing the offer letter and stuck; where and how to begin, then you must read the lines ahead carefully.

You need to start your offer letter by addressing the prospective employee of an organization. For example, you can write “Dear” followed by the candidate’s first name and last name.

You have to make it sound as positive and enthusiastic as possible; congratulate them with a positive expression. Make it sound upbeat, for example, an expression like “we are excited to offer you a position at [Company Name]”.  And it depends upon you, whether to make it formal or casual.

For what position have I been hired for, by the organization?

You need to begin the offer letter by specifying the details of the position, for which candidate has been hired along with the work logistics. It should include the title of the position; what would be the designation of the future employee of the company. The expected date of joining the company, on which the candidate would start his or her journey with the company, the new employee of the company will be employed full time or part-time.

You have to specify the location of the office, manager or supervisor. There has to be a brief description of the roles and responsibilities to be fulfilled by the future employee. All this information makes the prospective employee have an idea and what to expect while he or she is at work.

If you provide these details in the offer letter, it would help in the clarification of the misunderstood and overlooked points during the process of the interview.

Are there any contingencies or future possible events?

You must specify the contingencies pertaining to the job. For example, will there be any background check from the company’s side, any kind of drug test, 1-9 from?

Is there going to be any confidentiality agreement? Is the company going to track the reference checks or proof of employment eligibility?

Compensation is given by the organization

Make use of offer letter to clearly mention the compensation package offered by the company.  If you are employed by the company, don’t you want to know how much you will be making? On what basis you will be paid for by the company. Either it would be on hourly, daily, or monthly basis.

What would be the mode of payment? If you want, you can also highlight upon the equity, bonuses, commission, structures etc; if applicable to the role of an employee.

Is there any hidden notice period to be served by an Employee of the Company?

Offer letter includes an at-will statement, which prevents any unwanted contractual obligations. It is mandatory to specify the notice period to be served by an employee if any.

Determining the language to be used in the offer letter, you may also seek legal guidance to prevent the unforeseen consequences in the future.

Till what date, a candidate can reply to the offer letter?

Whenever you send an offer letter to the candidate, there has to be an expiration date mentioned in the end. There must be a deadline for the acceptance of the offer letter; this will not let you loose upon the other potential candidates for your company.

For example, you can give a week or so to the candidate to reply.

What kind of perks and benefits a prospective employee will be able to enjoy at your organization?

In order to attract good talent, you must mention the key benefits offered by your company. Try not to include too much of details, as this will be provided in the orientation package or employee handbook.  You can include the following benefits, in case your organization offers-

  • Work from home option
  • Flexible spending accounts
  • Insurance Coverage
  • Flexible working hours
  • Paid time off etc

How to close the Offer Letter?

Always end your offer letter on a positive note. Make it exciting and welcoming.  Do keep in mind to mention the contact details, in case candidates, have any query.

Specify the line for the candidates to sign the offer letter and mention the date, if they accept the offer letter.

Don’t forget the disclaimer at the end!

The Disclaimer is a must at the end of the offer letter. It explains that it is an informational and not a legally binding contract or agreement.

MM/DD/YYYY

Candidate First and Last Name

Candidate Address

City, State, Zip

Dear [Candidate Name],

We are happy to offer you the position of ____________at Company’s name ___________. The date of your joining is _______________. There will be a contingent upon [background etc]. You will be reporting directly to [manager/supervisor name] at [workplace location]. We have faith in you to deliver the best and be an excellent match to our company.

You need to perform ________ and required to ______________ [briefly mention relevant job duties and responsibilities].

You will be paid ________________amount annually. The salary will be credited to ______________. In addition to this starting salary, we’re offering you [discuss stock options, bonuses, commission, structures etc].

Your employment with [company name] will be on an at-will basis, which means you and the company are free to terminate the employment relationship at any time for any reason. This letter is not a contract or guarantee of employment for a definite amount of time.

Please confirm your acceptance of this offer by signing and returning this letter by [offer expiration date].

We are excited to have you join our team! If you have any questions, please feel free to reach out at any time.

Sincerely,

[Your Signature]

[Your Printed Name]

[Your Job Title]

Signature: ______________________________

Printed Name: ___________________________

Date: __________________________________

For more information please contact Enterslice.

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Narendra Kumar

Experienced Finance and Legal Professional with 12+ Years of Experience in Legal, Finance, Fintech, Blockchain, and Revenue Management.

Business Plan Consultant


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