Starting out right with new employees requires some good planning and documentation. It’s important to put your vision on paper to avoid any misunderstandings down the road. You will be amazed at how creating an offer letter really helps you to learn more about what you want for the future of your business.

The offer letter is very similar to the job description. The offer letter should come after a formal verbal offer and acceptance by the candidate. The purpose of the letter is to again outline the parameters for the job: the start date, office location, agreed-upon salary, benefits, supervisor, and the basic job duties. It is a good idea to put these specifics in so that there are no surprises on the part of the employee when he or she starts the job.

Do not include any time parameters for the job in the offer letter. Some employers will refer to the agreed-upon salary in terms of monthly pay so that if things do not work out with the new employee, they can be terminated. An annual salary could be interpreted as a year-long contract. You do not want to get into a sticky situation. A copy of the offer letter should go into the employee’s file.