Job offer letters, as part of the hiring process, are very common. While not required by any law, putting your job offer in writing helps ensure everyone is on the same page.
Unfortunately, what’s not common is doing job offer letters right. Too often they lack the necessary verbiage to ensure no legal issues down the road, or they add language that creates a binding contract. Doing this correctly up front can be critical to avoiding liability later.
Conditional offer of employment
One of the first aspects to consider is whether there are conditions for employment. In other words, is there anything else for the individual to “pass” for the job offer to be valid? For example, do they need to pass a background check? Or a drug test? Do you need to screen their references or call past employers? If there are additional steps in the process to complete, some of which are not legally allowed for a candidate to take until after a job offer has been extended, then the offer letter needs to be what is called a “conditional offer of employment.”
A conditional offer of employment would state clearly that the offer is conditioned upon passing certain requirements, and those requirements would be spelled out. For example, it could say something like: “The offer is conditional upon satisfactory completion of a background check. Your tentative starting date will be agreed upon when the conditions are satisfied.” You might also consider having the applicant sign the letter, ensuring full understanding of the requirements.
With any offer letter, there should be language that helps prevent creating a contract, which also means avoiding some verbiage that sounds nice—but can be detrimental.
If allowable, all job offer letters should include a statement about at-will employment. The at-will employment doctrine means that the employment relationship can end at any time, by either party, with or without notice. This exists in all states except Montana, where this language should either not be used or should be written to comply with their specific rule.
Phrases to avoid
Other language added to the letter can create a contract. Here are some examples of phrases to avoid:
- “Your employment will be for at least three months, at which time we will reevaluate your employment status.”
- “Your hourly rate will be $20.00 for the first six months. After six months, you will receive a $1.00 per hour raise. Raises beyond that will be at our discretion.”
- “In three months, you will receive a bonus of $250.00 for appreciation of your service.”
- “If this relationship does not work out for any reason, termination of employment will only occur with three weeks’ notice so that you may look for work elsewhere.”
- “Our practice is like a family and we look forward to working with you for years to come.”
These statements are essentially making promises or guarantees, and an employer may not be able to keep those if the new hire doesn’t pass other requirements or simply doesn’t work out once hired. While the job offer should set some parameters of the relationship and what can be expected, it should avoid broad statements—or promises or guarantees—that can backfire.
What to include
What should an offer letter include? Here are some basics:
- A friendly opening.
- Basic employment information as it stands currently, such as start date, full-time/part-time status, and schedule.
- Rate of pay, designated as hourly or salary. If salary, clearly indicate how it will be paid in terms of increments (weekly, biweekly, monthly); avoid putting the salary in annual terms.
- Any conditions for continued employment (as described above).
- A brief description of available benefits that will be more clearly outlined upon hire through the employee policy manual.
- Statement of at-will employment, if applicable.
A closing statement that should include who to contact for questions or concerns, and that this does not represent a contract.
While job offer letters seem to be a simple, nonproblematic task to complete, they can become tangled up in legal problems when not done properly and with care. Don’t make the same costly mistakes other employers have. Be sure your offer letters are carefully crafted. Once you know you have a well-done letter, use it as a template for all other job offers to ensure consistency.
REBECCA BOARTFIELD is HR compliance consultant and TIM TWIGG is president of Bent Ericksen & Associates. For more than 30 years, the company has been a leading authority in human resources and personnel issues, helping dentists successfully deal with ever-changing and complex labor laws. To receive a complimentary copy of the company’s quarterly newsletter or to learn more, call (800) 679-2760 or visit bentericksen.com.