Preparing An Offer Letter

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What Is An Offer Letter?

An offer letter is a document issued by a company to an individual formally inviting him/her to join as an employee, to fill a particular position in the organization. Prior to issuing the offer letter, the individual is interviewed and tested to ensure that he/she has the necessary qualifications to be hired. For this reason, an offer letter will comprise of various information such as job requirements or job description, salary details, joining date, and in some cases, company rules and regulations.

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Benefits Of An offer letter

  • An offer letter sample will comprise information on employee remuneration - gross salary, net salary, insurance, including stock options profit-sharing ratio, and leave policies and tax deductions.
  • A job offer letter can also be used as a letter of reference when applying for VISAs to foreign countries.
  • A job offer can also serve as a legally binding document in case of any future conflicts between the employer and the employee.
  • Checklist Points For An Offer Letter Format

  • Company header
  • Company Name and address
  • Employee’s Name and address
  • Employee Designation
  • Job Description and Responsibilities
  • Status Of Employment
  • Salary Details
  • Duration Of Employment
  • Joining Date
  • Documents To Submitted At The time of joining
  • Commitment or declaration
  • How to Write a Basic Offer Letter Format

  • A basic offer letter format begins with the company name, logo, and address, and the date of correspondence.
  • Address the letter to the employer with the right salutation.
  • Clearly state the subject line of the offer letter, to indicate to the employee that the letter is a job offer.
  • Commence the offer letter sample by confirming that he/she has been hired along with the joining date.
  • In case, if the employee is required to report earlier to the office for signing the contract or for other formalities, mention the date and time.
  • In case, if there is a probation period, remember to include the total duration of the probation, as well as other information on remuneration if it affects salary during that period, and thereafter.
  • Mention remuneration details, including tax deductions, bonuses, etc, in your offer letter.
  • If the job entails travel, please make sure to mention that as well, as part of the offer letter format.
  • Sign off your offer letter, officially, with full names, signature, organization stamp and seal.
  • FAQs on Preparing An Offer Letter

    Is an offer letter legally binding?

    Yes, an offer letter is legally binding, once an employee signs and accepts the position. However, if the job does not materialize, the employee cannot seek any legal recourse against the employer.

    Can an employer rescind a job offer letter, after an employee signs it?

    Yes. An employer may rescind a job offer based on legally valid reasons. If not, the employee may sue or take legal action against the employer.

    What is the difference between a basic job offer letter and a contract?

    A job offer letter is a formal employment offer that provides basic details about the job, and expectations.

    A contract, on the other hand, provides a full scope of the employment, including responsibilities, duration, and type.

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