How Do Offer Letters Differ from Employee Contracts?

If believe you've found the perfect job candidate and ready to produce an offer letter, be sure you know the difference an offer letter and an employee contract. An employment contract is signed legal contract between your company and the employee. Contracts are extensive than offer letters and usually include information as compensation, benefits, duties, and circumstances which an employee can be terminated.

Offer letters usually very brief and are used to informally offer a position a candidate. Typically, the candidate and employer already verbally discussed the job that has offered, and the letter is sent confirm the conversation.

To avoid confusion between an offer letter and a contract, , follow these guidelines when drafting your offer letter:

Statements time periods: Avoid statements that refer to specific time periods of employment -- for , "We would like you to start June 8, 2012." Avoid using term "probationary period" to describe a set amount of time the beginning of employment.

Specifics of employment: Do include any statements about employment such discussions of employment benefits, bonuses, or cases disciplinary actions or termination would occur. These are items that should be saved the employment contract the employee signs the beginning of employment.

Salary: Leave any discussion of salary or any references the employee's weekly, biweekly, or monthly rate.

Be general: Stick words such as "generally" or "typically" when discussing terms employment, such as company policies. Think what might be misconstrued a "promise," and avoid those types of phrases.

will: Do include an at-will statement making it clear that party (employer or employee) can terminate the offer at point. The simpler the offer letter, better. An example would be:

Dear (Name)

It is our pleasure to offer you employment (Company Name). This offer is contingent your passing (name any contingencies as certain tests that must passed, for example typing or drug tests). You may reply with any contingencies you wish to state an agreement of employment. Please contact our offices at your convenience.

To sure you aren't heading down a dangerous path, it's a good idea to a lawyer involved. Have an attorney look the offer letter to be sure your wording makes legal sense and isn't binding.


Adapted from: allbusiness.com, June 30, 2011.