How to Write an Offer Letter

Published:

Sep 15, 2022

An offer letter is a formal document that is sent to a candidate selected for employment by an employer. It sets out the most essential terms of the offer (like salary, hours of work and location) and the conditions of the offer (e.g. satisfactory references and evidence of qualifications). It also typically includes a deadline for accepting the offer. The offer letter is usually sent to the employee at the same time (or sometimes before) the employment contract is sent to the employee for signature.

Offer Letter Benefits

☑ Offer letters clearly outline the terms of employment, including job responsibilities, salary, benefits, and work hours. This prevents misunderstandings and sets clear expectations.

☑ A well-drafted offer letter can serve as a legal document outlining employment terms. This can be useful in resolving disputes or misunderstandings that may arise later.

☑ Sending a formal offer letter reflects the organisation's professionalism and reinforces a positive impression of the candidate.

☑ It provides written confirmation of the job offer, ensuring that both parties agree regarding the employment terms.

☑ By detailing job responsibilities and the company's policies, the offer letter helps set realistic expectations for the new hire.


Table of Contents

  • When Should You Use an Offer Letter?

  • What Format Should an Offer Letter be in?

  • Is a Job Offer Letter Legally Binding?

  • How Long Does Someone Have to Respond to a Job Offer Letter?

  • Can a Candidate Negotiate the Terms in the Job Offer Letter?

  • What Happens if the Candidate Accepts the Job Offer?

  • Can I, as an Employer, Withdraw a Job Offer After it Has Been Sent?

  • Should a Candidate Get a Job Offer Letter in Writing or Is Verbal Enough?

  • What if the Job Offer Letter Does Not Mention Everything Discussed During the Interview?

  • Can a Candidate Decline a Job Offer After Accepting it?

  • Why is an Offer Letter Essential?

  • How Should the Salary Be Stated in the Offer Letter?

  • Is It Necessary to Mention the Employment Type in the Offer Letter?

  • How Do I Address the At-Will Employment Clause?

  • What Is the Best Way to Set a Deadline for the Offer Acceptance?

  • Should the Offer Letter Mention Probationary Periods?

  • How Formal Should the Language Be in an Offer Letter?

  • What Is the Appropriate Way to End an Offer Letter?

  • What are the common pitfalls of an Offer Letter?

  • Offer Letter Templates & Secure Storage


When Should You Use an Offer Letter?

An offer letter confirms the terms and conditions of the offer of employment. For instance, a sample employment offer letter could quickly look to include:

  • Job title

  • Start date

  • Salary

  • Benefits information and eligibility

  • Conditions of the offer (for example, references and evidence of qualifications)


It should also include a deadline for acceptance of the offer. 

It is usually sent to the employee simultaneously with the employment contract. Alternatively, the employer may include the basic terms of employment in the offer letter, and the employment contract itself could be negotiated once the offer has been accepted. 

If this alternative option is chosen, the offer should be stated to be conditional upon the employee entering into an employment contract which is acceptable to the employer.


What Format Should an Offer Letter be in?

An offer letter is typically presented in a formal letter because it is an official document representing your company.

Is a Job Offer Letter Legally Binding?

In most cases, a job offer letter is not a legally binding contract but a summary of employment terms. However, it can have legal implications, mainly if it contains specific promises or conditions.


How Long Does Someone Have to Respond to a Job Offer Letter?

The response time can vary, but most employers usually expect a reply within a week. The offer letter should specify a deadline for acceptance to make this explicit and avoid miscommunication.


Can a Candidate Negotiate the Terms in the Job Offer Letter?

Yes, candidates can often negotiate terms such as salary, start date, and benefits. If they do this, this can also tell you a lot about the individual. 

For example, is this in a professional manner, highlighting their value to the company, or a demand and expectation? If the role is client-facing, how is their grammar, etc… which can also help you to understand more about your perspective. 

What Happens if the Candidate Accepts the Job Offer?

Upon accepting a job offer, a candidate typically signs and returns the offer letter. Once you have this back, you can start the onboarding process, which may include background checks and other formalities.

Can I, as an Employer, Withdraw a Job Offer After it Has Been Sent?

Yes, as an employer, you have the right to withdraw a job offer, typically if the candidate fails to meet certain conditions like passing a background check or if there are significant changes in the company's circumstances.

Should a Candidate Get a Job Offer Letter in Writing or Is Verbal Enough?

It is always best to give a job offer in writing. A written offer ensures that both you and the potential employee clearly understand the terms of employment.


What if the Job Offer Letter Does Not Mention Everything Discussed During the Interview?

If the offer letter misses critical points discussed in the interview, it is appropriate for the candidate to ask for these to be included in a revised letter - or to get clarification in writing.

Can a Candidate Decline a Job Offer After Accepting it?

Yes, they can decline a job offer even after accepting it, but it should be done as professionally and promptly as possible to minimise inconvenience.


Why is an Offer Letter Essential?

Once an employer has decided on the chosen candidate, it is likely to notify the candidate verbally that they have been successful in the application process.

Following this, the key terms of the offer should be confirmed in writing as soon as possible so that the employee has certainty and clarity about the terms of the offer and to show the candidate that the employer is committed to their recruitment. 

This is particularly important in a competitive jobs market, where candidates may simultaneously be part of several recruitment processes.

It also avoids the potential for misunderstandings and disputes about what the terms of the offer were. 


How Should the Salary Be Stated in the Offer Letter?

The salary should be clearly stated, indicating whether it is an annual, monthly, or hourly rate. Details about any bonuses or commissions should also be included.

Is It Necessary to Mention the Employment Type in the Offer Letter?

Yes, it's essential to specify whether the employment is full-time, part-time, temporary, or contract-based. This clarifies expectations and legal implications.


Should the Offer Letter Include Information About Benefits?

As part of the Offer Letter, you should include top-level details about health insurance, retirement plans, paid time off, and other employee benefits.


How Do I Address the At-Will Employment Clause?

If applicable, clearly state that the employment is at-will - meaning either the employer or the employee can terminate the job on offer at any time, with or without cause.


What Is the Best Way to Set a Deadline for the Offer Acceptance?

Provide a specific date or time frame by which the candidate should respond, ensuring it allows reasonable time for consideration.

How Can Confidentiality or Non-Compete Clauses Be Included?

You could mention that accepting the job offer is contingent upon agreeing to certain confidentiality or non-compete terms and refer to specific documents if applicable.


Should the Offer Letter Mention Probationary Periods?

If there is a probationary period, it should be clearly stated, including its duration and any conditions that differ from standard employment.

How Formal Should the Language Be in an Offer Letter?

The language should be professional and formal, reflecting the document's official nature and the employment offer's seriousness.

What Is the Appropriate Way to End an Offer Letter?

Conclude with a positive note, expressing enthusiasm about the candidate joining the team, followed by a formal closing and the signature of the person authorised to take the offer.

What are the common pitfalls of an Offer Letter?

There are many pitfalls to Offer Letters that can often go unseen. These can include, for instance:

Not giving an offer letter

Without an offer letter, there will be a lack of certainty and clarity as to the employment terms being offered. 

In addition, candidates are likely to take a verbal offer less seriously, which may make a candidate less likely to accept the offer, particularly in a competitive job market.

Not having a deadline for accepting the offer

Including a deadline for accepting the offer is essential to focus the candidate’s mind and ensure that offers do not remain on the table for too long. 

After the deadline has passed, the offer then automatically lapses without the need for the employer to withdraw it.

Not having a written employment contract 

The employer should also send the employee an entire employment contract that contains the key terms and conditions outlined in the offer letter and satisfies legal requirements for the information to be included in an employment contract.

In the UK, for instance, it is a legal requirement that employees are given a written document summarising the main terms of their employment.

This is known as the “Written Statement of Particulars of Employment” (or sometimes the “Section 1 Statement”, as it is required under section 1 of the Employment Rights Act 1996).

Some critical information must be included in a Written Statement of Particulars of employment. For example, information relating to salary, benefits, place of work, work hours, leave entitlements, training opportunities, probationary period and notice period, among others.

The Written Statement of Particulars of employment must be given to the employee by no later than their first day of work.

Usually, an employer will want to include additional terms beyond what the law says must be in the written statement of particulars of employment, which is why an employment contract is usually used. 

Inconsistencies between the offer letter and employment contract

It is essential that the offer letter - and employment contract - are consistent with each other. 

Ideally, the contract should make it clear that, in the event of any inconsistency, the contract terms will prevail. This avoids the potential for disputes between the employer and employee at a later date regarding the terms and conditions of the employment.

Losing the signed copy

Without a signed copy of the offer letter, there is no evidence of the offer's terms. 

Once signed, it is essential to ensure they are saved securely. Signed letters can quickly and easily be held on the PocketLaw platform so that they are securely stored.

Require a Workflow Management for any changes?

If making and resending changes is less straightforward due to your company processes - for instance, internal stakeholders may need to approve the changes first - then our all-in-one legal platform comes with built-in workflow management. This built-in workflow management then allows you to collaborate as a team in real time.

With this feature, you can make the changes you need to, then send it, for instance, to the CEO to approve before it goes to the candidate.

With the approval process being logged along the way. 

This allows you - and your company - to adhere to your internal process flows before changes to your legal templates and offer letters can occur.

e-Signatories

Knowing when an offer letter has been signed is also made a breeze as this is logged in the platform for review later on as well with our eSign functionality.


Offer Letter Secure Storage

In addition, you can store all your agreements in our clever document management system. Everything you need to grow your business and drive it forward.

Disclaimer:
Please note: Pocketlaw is not a substitute for an attorney or law firm. So, should you have any legal questions on the content of this page, please get in touch with a qualified legal professional.

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