Offer Letters

Offer Letter Do’s and Don’ts

In the past few months, I’ve had contact with several clients who were opening the door to creating employment contracts with employees rather than merely welcoming them to their organization with an offer letter.

Let’s discuss what some of the real problems could be with offer letters. One problem would be that you promise employees “lifetime” employment. Since no one ever wants to make this type of commitment, be aware of the following:

• Don’t tell employees that you wish them a long successful career with your company. While it sounds nice and welcoming, what happens when you discover in their third month of employment that they are not capable of performing the job? Terminating them would contradict your promise of a “long successful career.” Instead, wish them success as part of the team – but never add anything that directly or indirectly implies length of employment.
• Don’t talk about a probationary period turning into permanent employment. This language is more union-directed and may not reflect of your status as an employment-at-will employer. You’re better off talking about becoming a “regular” employee after completing an “introductory” or “orientation” period. /li>
• Be sure your employment offer letter always includes an employment-at-will clause. While it doesn’t sound welcoming, it’s the most important part of your offer letter. The clause should state: As with all Company employees, your employment is not for a specific term and may be terminated by you or by Company with or without cause, at any time and for any reason.

Copyright (c) 2009 Arlene Vernon, HRx, Inc.

So What Should You Include In An Offer Letter?

• A warm welcome paragraph including their job title and who they report to.
• You could highlight their job responsibilities and/or include an attached job description. Be sure that the job description lists “other duties as assigned.” You may also want to add their basic work hours.
• Compensation: If they’re an hourly/non-exempt employee, present the wage in hourly terms. If they’re a salaried/exempt employee, present their wage per pay period. Do not tell them that their annual salary is $xx,xxx – although you can state that it is “annualized to $xx,xxx.” This avoids guaranteeing them 12 months of pay when they work fewer months.
• Noncompete Agreements: In order for these agreements to be enforceable, they must be discussed with the employee prior to the offer of employment. So, if you’ve discussed the agreement with the candidate, you should include the agreement with the offer letter.
• Confidentiality Agreement: If this is also a requirement of employment, then include this agreement with the offer letter.
• An outline of Insured Benefits is common. Most candidates want to know when their coverage will begin. Just be sure to state that the details of the benefits are included in the benefits plan documents.
• An outline of Time Off Benefits is also common. The same applies as in #5 above, be sure to reference your employee handbook for the details of the benefits.
• Many letters include I-9 requirements and a reminder to employees to bring their identification with them.
• Orientation and first-day reporting details are always useful in this letter. That way the new employee arrives at the right time and asks for the right person.

It’s also nice to follow up the offer letter with with a phone call to confirm that the candidates received the letter and to answer any other questions they may have. That personal touch goes far when someone is determining whether to join your company.

Copyright (c) 2009 Arlene Vernon, HRx, Inc.

About Arlene Vernon

Arlene Vernon, PHR, partners with small businesses as their Human Resource Xpert to create their HR systems and solve their HR problems.

If you have gaps in your HR operation, have an employee problem to solve, or want to enhance your managers’ skills, call Arlene today. Learn
how HRx can save you time and help you avoid costly HR mistakes. HRx, Inc., 574 Prairie Center Drive #135/285, Eden Prairie, MN 55344, 952-996-0975,
www.HRxcellence.com.

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