Offer Letter

What is an offer letter?

An offer letter, or offer of employment letter, is a document an employer gives a candidate that explains the key details of an employment offer. An offer letter may include key information about the offer, such as wages, work hours, and vacation. Offer letters may also be used when existing employees transition to new roles.

What does an offer letter include?

The exact contents of an offer letter vary depending on the employer and position, but it generally outlines the key details of the offer.

An offer letter may include:

• Job title: The position the candidate is being offered.
• Start date: The date the candidate is expected to begin work.
• Pay: The salary or hourly wage and the frequency of pay.
• Hours of work: The candidate’s working hours or schedule.
• Work location: Where the candidate will normally carry out their work.
• Vacation: Information about vacation entitlement or vacation pay.
• Benefits: Details of benefits included with the position where applicable.

Is an offer letter the same as an employment contract?

No. An offer letter and an employment contract serve different purposes.

An offer letter typically summarizes key details of the employment offer, while an employment contract sets out the terms and conditions of employment, including the rights and responsibilities of both the employer and employee, in greater detail.

An offer letter should be used alongside an employment contract rather than in place of one. The employment contract should be provided to the candidate for review and acceptance before they begin work.

Is an offer letter legally binding?

Whether an offer letter is legally binding depends on the contents of the letter and the circumstances surrounding the offer and its acceptance. Employers should ensure that the details in the offer letter are accurate, consistent with the employment contract, and comply with applicable laws. 

Candidates should carefully review both the offer letter and employment contract before accepting the offer.

What should you check in an offer letter?

Before sending an offer of employment to a candidate, you should carefully review the offer letter, along with the employment contract and any other applicable documentation. 

If anything seems unclear or ambiguous, revise the letter before providing it to the candidate.

For more information on the differences between employment letters and employment contracts, see the recruitment and hiring section in our HR Glossary.