Five Things You Need to Put in Your Company’s Offer Letters
With the holidays and elections behind them, many employers have resumed their hiring activities. For many new hires, the relationship with their new employer begins with an offer letter. These letters – what’s in them and how they are written – are vitally important to establish from the outset a clear understanding of the employment relationship. Accordingly, they should include these critical elements:
- The basics – position title, to whom the new hire will report and anticipated start date. A separate job description can also be attached.
- Compensation. For salaried employees, the annual salary should also be broken down into the per pay period amount to avoid potential unintended contractual obligations. Hourly positions should list the hourly rate of pay since actual annual compensation will vary. If the position is also eligible for a commission or bonus structure, it can be referenced, but actual details of the plan are generally best put in a separate document with full criteria, disclaimers and other details of the compensation program.
- Whether the position is full- or part-time and eligible for benefits. While offer letters typically don’t outline the specifics of benefits, employers may want to reference the start date and the dates on which the employee will be eligible for certain benefits. If any benefits information is listed in the offer itself, a disclaimer should be included that the employer reserves the right to change its benefit offerings at any time, including eligibility requirements and how much employees must contribute.
- Contingencies of the offer. At a minimum, a requirement would be the new hire completing an I-9 and producing acceptable documentation of his or her identity and right to work in the U.S. within the first three days of employment. Contingencies may also include completion of a background check, a requirement to obtain or maintain a particular license or certification, and similar requirements that, if not met satisfactorily, would end the employment relationship as quickly as it begins.
- An at-will disclaimer that the offer is not a contract or a guarantee and that employment may be terminated by either party, at any time, with or without cause or notice.
If you have any questions about drafting offer letters, please contact us at 877-660-6400 or Contact@affinityHRgroup.com.
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