Offer Letter Do’s and Don’ts

“I am creating an offer letter only because the candidate asked for one but I don’t know what I should put in it.”

Your HR Survival Tip

While an offer letter has not always been legally required, it has always been a good idea. Newer laws require a written offer to candidates, depending upon your hiring process. The biggest problem we see is companies trying to put too much into that letter or not using the correct language…both of which can be problematic. We prefer to keep the actual offer letter quite simple because it can be considered a legal document.

  • DO include the full details of the proposed position, such as “We are pleased to offer you the non-exempt, full-time position of Program Coordinator, reporting to __.”

  • DO include the date you want the person to start in this position. Hopefully, you already discussed the date they will be available but, if not, use something like “on or before December 1st, 2020.” While you may be anxious for them to begin, you also want to appreciate the fact that they want to give their current employer notice rather than leaving abruptly. How they leave that employer is a clue to how they would leave you.

  • DO include the rate of pay and frequency but it should be listed as either the hourly rate or salary paid each pay period, such as “You will be paid $2,500.00 per semi-monthly pay period (annualized at $60,000).” Many companies just say the pay is $60,000 without realizing an enterprising attorney could try to hold you to paying that full amount even if the employee didn’t stay a full year.

  • DO include a contingency statement if you are going to have that candidate do a drug screening or background check, such as “This offer is contingent upon the company receiving an acceptable background report and drug test.” In fact, if you are doing background checks, a written offer must be provided before requesting the report.

  • DO mention your benefits but only in a very generic way, such as “You will be eligible for any benefits normally offered to someone in your position.” If you are giving this position special perks, such as a car or gas card, do list those because they aren’t normally provided to every employee.

  • DO include your at-will statement.

  • DO include a deadline for the candidate to respond, such as 3 business days, so you aren’t left wondering whether you can move on because you haven’t heard anything.

  • DO include a place for the candidate to sign their acceptance of your offer.

  • DO NOT mention the details of your normal benefit plans because they may change and you don’t want to be stuck with extra benefits you might have mentioned in the letter.

  • DO NOT list the details of the job duties. Instead, you could mention a job description is attached. Again, if you want to change or add duties down the road, you don’t want this offer letter limiting that ability.

The offer letter should be simple but include the relevant facts of what you are offering. You can make the verbal offer first to make sure the candidate doesn’t want to negotiate but then you immediately follow up that conversation with the letter. When you only do a verbal offer, there may be misunderstandings but a written offer is harder to dispute…from either side.

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