What should be included in a job offer letter?

Essential components of a job offer letter include job title, department, reporting manager, start date, work schedule, and compensation details. Salary information should specify whether it's hourly or annual. It should also explain any bonus structures or commission opportunities. A benefits overview covering health insurance, retirement plans, paid time off (PTO), and other perks helps candidates make informed decisions about whether this is the right job for them. Legal disclosures and equal opportunity statements should also be provided in offer letters to give the candidate a full picture.

How does an offer letter differ from an employment contract?

Offer letters create clear expectations between employers and new hires, but they're generally not binding. Employment contracts are enforceable as they contain specific performance requirements and termination clauses. Offer letters are the standard for most positions in the U.S.

Can an offer letter be revoked, and under what circumstances?

While employers can withdraw a job offer before the candidate's start date, it's important to navigate the legal considerations involved. Valid reasons include budget changes or failed background checks. It's much more complex to withdraw a job offer after a candidate has already accepted or started, and businesses may need legal counsel for these cases. Employers can also utilize HR compliance software to track offers and understand the regulations, if rescinding is necessary.