Finally, you’ve found the right person for the job! Their references check out, and they impressed you in their interviews. They will be perfectly suited to work in your business.
Now it’s time to make them an offer of employment.
How should you do this? Call them up? Send them a text? Write them a letter?
You could make that offer in any number of ways. Yet, if you’re not careful, some of these ways make you vulnerable to significant risk, and may mean that you are in breach of the law.
In my view, the best (and lawful) way to offer employment involves three things:
- Putting the offer in writing
- Providing an employment agreement at the time of the offer
- Setting a timeframe for accepting the offer
PUT THE OFFER OF EMPLOYMENT IN WRITING
Employment agreements don’t have to be in writing. You can offer to employ someone over a casual cup of coffee, and if they accept your offer, an agreement has been formed.
For example, you might say, “Hey Brian, do you want to work for me sweeping floors in my factory for $20 an hour, 40 hours a week?” If Brian responds, “Sure,” then you have an employment agreement between you. It can be that simple.
The risk with making offers this way is that your new employee can misunderstand your offer (“I didn’t say I would employ you myself, I meant my company.”). And you can end up in dispute about what you included in your offer (“I didn’t say I would pay you a bonus!”)
Putting the offer in writing means you can avoid such misunderstandings.
Write an email or cover letter that makes clear at least the following:
- Who you are offering employment to
- Who the offer of employment is being made by (i.e. is it you personally or a company?)
- What the key terms are in brief (i.e. the role, salary, or wages), or refer to the employment agreement (more on that below)
Sometimes, employers think sending a letter is a bit cold. Why would I write a letter when I can just tell them in person and maintain a friendly relationship? Isn’t writing letters for big corporates? Doesn’t writing a letter get us off to a bad start by suggesting that they can’t trust my word or my handshake?
Of course you want to have a good rapport with your staff. That’s key to the relationship of trust that is essential when employing others. But the risks of not putting your clear offer in writing are too great in my view.
If you want to keep a personal touch, follow up your email or letter with a phone call. Tell them that you look forward to their response to the offer and that you are happy to answer their questions.
PROVIDE AN EMPLOYMENT AGREEMENT
You should not only make the offer of employment in writing, but also supply the full terms of your proposed agreement. There are three reasons why that is a good idea:
You must have a written agreement anyway
You must have written employment agreements in place for all your employees. So you may as well do the work of preparing an agreement and providing it to the employee from the outset.
If you don’t, you might find that the busy nature of life and work takes over. There will always be something seemingly more important to do. In which case that agreement might never eventuate. And then you’ll be in breach of the law.
You must give them a chance to review it
You must give the candidate a chance to review the employment agreement. That opportunity to review the agreement, and get legal advice if they wish, must come before they sign it.
It must be a real opportunity. Don’t just wave the agreement under their nose and expect them to sign it there and then. Provide them with a copy, tell them to consider it and get advice if they wish. Allow them several days to confirm whether they agree to its terms.
You include the terms that matter to you
If you don’t give a written agreement, you risk excluding terms that you may later wish you had made part of the deal.
As I mentioned above, employment relationships can form during a casual conversation. Once you form the agreement, that person is your employee. You can’t bring in any other terms to govern your relationship unless they agree.
This is critical for including clauses such as 90-day trial periods. You must have a 90-day trial period clause in your agreement to take advantage of this law. And you can’t insert one for someone who is already employed by you. So if you reach an agreement during casual conversation, it’s too late to add a trial period clause.
The lesson? When you send your written offer, attach the proposed employment agreement.
SET A TIME FOR ACCEPTANCE
Finally, the written offer should specify how the employee can accept it.
This has two aspects: time and mode.
The timeframe for acceptance should end before the employment is due to start. Preferably well before, a few days at least. If the employee does not accept by that time, then the offer lapses. It should also give the employee enough time to consider the terms of the offer, as I have mentioned above.
Also, you want to tell the employee the mode of acceptance; that is, how they are to show their acceptance. It is best practice to ask them to return a signed copy of the employment agreement by the due date. That is because the law requires you to keep one on file for all staff.
If the candidate does not sign the agreement by the due date, follow it up with them. Don’t allow them to start work until the agreement has been signed.
The best way to start an employment relationship is with clarity from the outset.
You do this by making the offer of employment in writing, including an employment agreement and a date to accept the offer by.
Doing this will help to avoid misunderstandings about the basis of your offer. It also means that you will be doing everything you can to follow the law.
Good luck with your next offer!