Is a Job Offer Letter Binding?

A job offer letter is an agreement of employment.
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Getting a job can be a challenge — in almost any economic climate. So you deserve to let out a cheer or two when an offer letter appears in your mailbox. But before you go signing the letter, realize that you could be entering into a binding contract with that employer. Read every word and understand what you’re agreeing to when signing on the dotted line.

The Offer

    As long as the job is accepted, an offer letter is binding. It shows that an agreement was reached between the two parties. But offer letters are usually worded in such a way to protect the employer. It isn’t uncommon to find conditions in the document, such as completing a probationary period or passing a background check. Many job offer letters also detail the relationship of your employment, using statements like “at-will,” “employment with the company is for no specific period of time” or even “the company may terminate your employment at any time and for any reason, with or without cause.”

The Acknowledgement

    After receiving the job offer letter, contact the company immediately — be it by phone, e-mail or letter. Inform the prospective employer that the letter has been delivered. Even if you’re still undecided, relate the receipt. Give the company an idea of when to expect a decision of acceptance. Provide an exact date, going so far as to give a time of day, and relate your thanks for the job offer.

The Acceptance

    Although the offer letter usually supersedes other agreements, consider sending a letter of acceptance — or letter of rejection, if, of course, you decide not to take the job. With a letter of acceptance, reiterate your appreciation for the job and detail the terms and conditions already specified in the job offer letter. This ensures you understand what you’re agreeing to. If a start date wasn’t stated in the job offer letter, use this the letter of acceptance to specify the date in writing.

Legal Advice

    No matter how informal an offer letter reads, consider seeking legal advice before signing. Along with conditions, employers also include terms, and these terms may limit future employment. “Non-compete” clauses, for example, can prevent you from applying for jobs at competitor companies. Even if your company goes belly-up, the employer could keep you from applying for jobs at companies within that industry. If you find questionable terms in the offer letter, talk to the prospective employer to arrive at a new agreement of employment.

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