Hiring employees is exciting, especially when you're just starting out. An offer letter is a must-have document in your template library and the importance of having solid, proven wording cannot be overstated.
Generally speaking, an offer letter lays down the terms of work and compensation that your company is offering to the prospective new hire. It includes basic details like the salary package, department, position, and vacation. The candidate gets a specified number of hours or days to review, responds with counter offers or alterations in terms, and sign, indicating acceptance and intention to join your company. The process of offer and acceptance are essential ingredients of a legally-binding contract.
An offer letter also gives prospective employees proof and confidence of a new job enough to leave their existing company and to not accept other offers. In addition, an offer letter can be upheld in a court of law with respect to the terms of conditions that both the employee and the employer have agreed to at the time of joining.
An offer letter is both a policy document and a legal contract. In the earliest stages of a startup company, before it has established HR policies and procedures and employee handbooks, the offer letter is often the only formal documentation establishing the duties and responsibilities of an employee.
When an employee signs an offer letter and returns it to you, he has accepted the terms of the job. Legally, you are bound to shoulder the compensation promised and the employee is bound to show up for work. Beyond daily duties, offer letters often contain additional provisions that protect the company from employees divulging trade secrets and other confidential information, as well as other harmful activities such as poaching and solicitation of clients.
My clear, comprehensive and full-featured 4-page offer letter template
is for use with new hires. This template is fully annotated with my commentary and based on the offer letter wording that I have used many dozens of times over the last 5 years. In addition to the standard terms of employment that you would expect to find, I have included valuable, optional boilerplate paragraphs to cover:
- Relocation expenses
- Signing bonus
- Equity grants
- Phone/Travel expenses
- Confidentiality and Invention Assignment
- "Side Project" Exceptions
- Non-compete Clause
Bundle includes Pages, MS Word and PDF formats.