How should you write an employee offer letter and what should you include? We cover all the essentials and provide a template to help you craft yours.
You’ve found a candidate your team agrees on. You’re interested in moving forward and extending an offer. Congratulations – you’re nearly there! But don’t forget about an important document that will seal the deal: the employee offer letter.
Why provide an employee offer letter?
While many recruiters and hiring managers will call a candidate to make a verbal offer, an employee offer letter is a formal document that gives candidates the opportunity to review the details of their offer. Consider a clear and informative offer letter as the final step in creating a thoughtful candidate experience.
Written offer letters are especially helpful when an offer contains detailed information about compensation, equity and benefits. After the initial excitement of a phone call, candidates may realize they still have questions and recruiters may have forgotten to mention a specific yet important detail. Offer letters are generally e-signed by both parties and while they are not always legally binding and are no guarantee against ghosting, they do indicate a level of seriousness and commitment from both parties.
What should you include in an employee offer letter?
The exact contents of your offer letter may vary depending on factors like your industry, company stage and size and the role itself, but you’ll generally want to include the following elements:
If there are any conditions candidates need to meet in order to finalize their employment, such as proving their eligibility to work or passing a background check, you can outline these in your offer letter. If there’s a time limit attached to your offer, be sure to mention it clearly and provide information about what candidates should do if they want to request an extension.
When are you expecting the candidate to officially begin working for you? Include this date in the offer letter. You may also want to note other relevant dates such as when the new employee will be eligible for benefits.
Include a high-level overview of the candidate’s role, including the job title, who they’ll be reporting to and a brief description of their main responsibilities.
Terms of employment
You can note whether this is a full-time, part-time or contract role. Depending on your location, you may also want to include a statement describing the employment as at-will. At-will employment agreements allow both employers and employees to terminate the agreement at any time.
If your company has multiple offices, it’s important to specify which location the new hire is expected to work from, whether in office, or distributed.
Clearly state whether the employee is exempt or non-exempt from the Fair Labor Standards Act (FLSA). Exempt employees are not entitled to overtime pay and earn the same salary whether they work a 30-hour week or a 50-hour week. Non-exempt employees must be paid overtime whenever they work more than 40 hours in a week.
What is the salary for this role and how often are employees paid? Be sure to outline these details in your offer letter. You can mention how the salary is calculated (annually, hourly or in some other manner) and how commissions or bonuses work for this role.
If you’re offering a sign-on bonus or any other type of bonus, be sure to describe it (including amount, date it will be paid and any conditions) in your offer letter.
Many companies prepare separate onboarding documents to help new hires navigate their benefits. And in the interest of keeping your offer letter succinct, you may not want to cover all of your benefits information in detail. But it’s a good idea to note some of the main benefits you offer (such as health insurance, 401k and commuter subsidies), when employees are eligible to sign up for them, who in their family is covered and where they can find additional information.
If employees are granted equity as part of their compensation, be sure to include the most relevant information in the offer letter. As with benefits, you can point them to additional resources if this is a topic they’d like to explore in more detail.
Employee offer letter template
[Company name and address]
Dear [candidate name],
We’re happy to officially offer you the role of [job title] with [company name]. Please review the terms below and let us know if you have any questions.
Your role will be [job title] and you’ll be reporting to [manager title], [manager name]. Your primary duties will consist of [main duties/responsibilities for the role]. Your start date is [date] at [office address].
Your starting salary will be [salary amount], to be paid [frequency and method of payment]. You will also receive [equity information].
This is a [full-time/part-time/contract/at-will] role. [Mention any other relevant information about the terms of employment here.]
We offer a full slate of benefits, including [health insurance, 401k with matching, commuter subsidies, other]. You can learn more about benefits and compensation in the benefits overview packet, which is included as an attachment to this email.
If you have any questions or would like to discuss anything in more detail, you can contact [contact name] at [contact email or phone number].
Please sign below to indicate your agreement to the terms outlined in this letter.
[Employee name, signature and date]
We’re excited to have you on our team!
[Recruiter/hiring manager/CEO name, signature and date]
Want help drafting your offer letter in Greenhouse? If you’re a Greenhouse customer, you can learn how to generate offer letters in this article and this video.