The fundamental difference between letters of offer and employment contracts? The letter of offer is an unofficial way to present a candidate with a job without legal obligations. An employment contract is a binding agreement that both the employer and the worker must conclude. Not sure which document to send to your new employees? Watch this blog! A common question that arises when startups start hiring new employees is whether they should use a letter of offer or an employment contract. Both the letter of offer and the employment contract have the same fundamental purpose: to rewrite the conditions of work and employment in writing. But everyone also serves additional purposes, and understanding the differences ensures that you are using the right document in the right situation. You can also customize the messaging text and adapt the tone to your company culture. But keep the language in your job offer letter, as this is an official document describing the terms and conditions of employment between you and your future hiring. Exclusion of liability: The following offer recommendations should only be used as guidelines. Please select only the parts that apply to your business. Neither the author nor assume any legal responsibility for the accuracy, completeness or usefulness of the information provided in this article, in whole or in part. In Prozinski vs Northeast Real Estate Services, Inc., for example, Prozinski was fired by Northeast Real Estate Services, Inc. for financial mismanagement, sexual harassment and discrimination. Prozinski argued that he was entitled to the one-year salary and coverage of the benefits promised in his letter of offer.

As the letter of offer was signed and also used a “promised language”, Northeast Real Estate was held responsible for the payment to Prozinksi of the severance pay mentioned in its letter of offer. Scenario 1: After an extensive interview process, an employer has chosen a suitable candidate. The employer offered the position orally to the candidate and followed up with a letter of offer. The letter stated that the company was in good financial health and that the candidate “would have job security in the company even in these difficult economic times.” The candidate accepted the position and signed the letter of offer….