Although companies typically experience a recruiting slowdown in the summer, that does not mean that employers should slack on ensuring that they know what elements make up a good, compliant offer letter. In fact, employers should take advantage of slower hiring periods to brush up on the components of an offer letter, so that when the need for talent becomes urgent, they do not need to spend precious time and resources meticulously crafting an offer letter.
The Stages of a Job Offer
Before we cover the necessary elements of a job letter, let’s review the typical stages of a job offer.
First, there is typically a verbal offer extended either over the phone or in person. Extending an offer verbally first creates a more personal connection, and allows the prospective employee to hear the good news right from their hiring manager and/or potential manager’s mouth. When extending an offer verbally, employers should make it clear that they do not expect an immediate answer, so the candidate does not feel put on the spot. They should also let the candidate know that a more formal offer letter with written details should be expected in their inbox, ideally that same day.
After a verbal offer is made, the candidate should quickly receive a written job offer. Typically, this will be sent over email as an attachment, with a formal letter on company letterhead stating details like compensation, benefits, and more, and signed by a hiring manager. Including the offer letter as an attachment instead of as part of the body of the email makes it easier for the employer to save it for their records. It also looks more “official”. The body of the email should be short and simply explain that the formal letter is attached. An example of the body message is:
We are so excited to extend an offer for you to join the (company name) team as (job title). Attached, please find the official offer letter. If you choose to accept the offer, please sign the offer letter and return it by (deadline). Let me know if you have any questions at all!
The Elements of an Offer Letter
While job offer letters will vary from employer to employer, there are some key elements that all job offer letters should contain to avoid confusion and compliance issues, including:
Details of the role, including the official job title, specifics of position, manager or supervisor the hire will report to, and whether or not the role is full or part-time.
Compensation, including how much the hire will make on an hourly or annual basis, as applicable. This section should also detail when and how often the employee will be paid, and the options they have for receiving payment, such as a check or direct deposit. This section can also touch on additional forms of compensation, such as commission, bonuses, and equity.
Benefits, including a summary of the basic benefits your company offers. Avoid going into too much detail in this section, as most companies typically send out a separate packet of information on employee benefits.
Contingencies, or steps that the hire will have to take to secure the job. This may include things like passing a drug test, passing a background check, having a valid driver’s license and vehicle, signing a confidentiality agreement, and more.
Statement of at-will employment, which signifies that the company or the employee can terminate the working relationship at any time. This affirms that the offer letter is not a contract and can help prevent the employer from facing thorny legal issues down the line.
In conclusion, crafting good offer letters is crucial, but can be challenging.
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Tom DiSilva has been providing professional human resource services for over 30 years. As the CEO of Navigate PEO, he actively partners with organizations of all sizes in the Greater New England area and across the country to help their businesses grow. He has expertise in HR and Labor Management, offering guidance and support for key areas of business such as negotiations, operations management, employee coaching, and employee benefits design.