Employment Offer Letters
Date: April 19, 2022
By:
Steven E. Bers
The Offer of Employment letter serves many purposes. The letter must enhance the applicant’s interest in the opportunity and protect the employer against claims that it misrepresented the employment opportunity. The letter must be sufficiently substantial to allow the applicant to resign from current employment. It must sell the job.
The offer letter should be organized as a story – beginning with the first global considerations followed by the terms that naturally follow. It should be positive. Too often we see offer letters that start with a message similar to “you are employed at will and can be terminated at any time.” Some offer letters continue the buzz-kill with multiple repetitions of the “at will “ status warning.
Instead, the natural order is an introduction welcoming the applicant and expressing enthusiasm for the applicant’s interest. Next follows the name of the position, the reporting date, and a reference to the supervisor to whom the individual will report. A description of the expected work schedule is included completing the initial employment landscape.
Then comes compensation, expressed as either an hourly rate, or a base salary calculated “at an annualized rate of $X.” Too often HR professionals unnecessarily add that the position is “exempt” or “non-exempt.” The average person outside the HR world can find these terms confusing. Clarity is achieved by merely noting if overtime is paid. Finally, the compensation section should state the frequency of pay, and whether the employer employs direct deposit.
Next, explain the benefits. Bullet each benefit separately. There is no need to identify every term or condition of every benefit, so long as the following necessary language is included, “This letter provides a general summary of the terms and conditions of our benefit plans, which are further explained in our company policies or in material provided by our benefit providers.” The offer letter is not the place to attempt a detailed description of every retirement or health benefit term.
The bulleted benefits should include holidays, vacation, personal or sick day allotments; life, disability, health insurance; retirement programs; and any other significant benefits. For health insurance, the offer letter should identify if there is shared payment, and what coverage is available, along with a statement that coverage and carriers may change from time to time, and that employee contribution costs may vary.
Toward the end of the letter it is adequate to write that employment is “at will.” There is no legal need to add that the employer may terminate at any time. The mere statement that employment is “at will” is adequate to establish the right to terminate at any time.
Next, there should be an “integration clause,” stating that all the terms of the employment offer are included in the offer letter, to the exclusion of any other oral or written representations. This term is vital to avoid any retroactive claims that matters represented in initial conversations were misleading, or that any oral promises were made. This is especially important if recruiters may have been over zealous in representing the position.
The offer letter should include a representation by the applicant that the applicant is not otherwise prohibited from accepting employment, most notably by any pre-existing non-competition term, and that all matters provided by the employee in applying for the position were truthful, without known misrepresentation or deletion of material information.
It is also protective of the employer to direct that the applicant is expressly prohibited from using the confidential information from any prior employer in furtherance of the employment. So too, the applicant must be informed if the employer will require the signing of a non-compete agreement or confidentiality agreement.
Finally, any contingencies, such as the requirements of a medical examination, substance abuse testing or a favorable background check, must be spelled out. Note particularly that most states now require an offer of employment to be provided prior to these contingencies.
The letter should conclude with a portion of the letter to be returned to the employer, signed by the employee, accepting the terms of employment and attesting that the representations and warranties are true and correct.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.