We often approach signing offer letters with as much caution as we do launching a new app: completely skimming past the terms and conditions and clicking “accept” before knowing what we’re really getting into. I understand the temptation to do so — signing the offer letter is the final piece of the puzzle, and getting it over with as quickly as possible allows you to breathe a sigh of relief after all of the time and energy you put into the job hunt.
But the fine print can carry some serious weight, and shouldn’t be ignored.
“Job offer letters are tricky and should be read carefully. Sometimes information about title, compensation or duties will not make its way into the letter accurately — usually inadvertently,” says Bryan Wood, Manager at The Wood Law Office, LLC. “But offer letters frequently also include non-negotiable ‘terms and conditions’ of the new job not routinely discussed in interviews… in this case, you need to consider whether the [position is] right for you.”
Nikki Larchar, Co-Founder/Human Resource Business Partner at simplyHR LLC, agrees.
“Since the offer letter is a legal document, it can be difficult to make changes after it has been signed… Wanting to make changes to the offer letter after this point causes a huge traffic jam, and creates additional work for others,” Larcher says.
So before you sign that dotted line, look out for these ten things — whether you can negotiate them or not, being fully informed can only help you make better decisions.
1. Dates and Times
Paying close attention to your start date is a must: there are few ways to make a worse impression at a new job than not showing up at the right time. Additionally, if you have a vacation planned or need to relocate, you may want to request that the start date be pushed back. But beyond your start date, there are a number of other important dates to keep in mind.
“Generally, there are specific dates when medical insurance, 401k, and time off accrual kick in,” says Dana Case, Director of Operations at MyCorporation — so don’t go planning a doctor’s appointment, vacation, or your retirement without first referencing the offer letter.
Also worth checking? Whether or not you’re subject to “‘probationary’ periods during which you can be fired for no reason,” Wood says.
2. Job Responsibilities
Of course, before you sign a job offer letter, you need to agree on what the job actually involves — you don’t want to agree to take a position when the responsibilities have been misrepresented to you. It’s also critical to have a record of these in case your position evolves in the future.
“Ensure that all your job responsibilities are clearly outlined and described in the offer letter,” advises Valerie Streif, Senior Advisor at career services company Mentat. “This is important so that if in the future your boss tries to change your responsibilities or downgrade you in some way, you have it in writing what you are supposed to be doing.”
3. Base Salary
You might have already discussed salary on the phone or in an email, but now’s the time to make sure that it matches up on paper, too.
“Make sure the compensation package meets your expectations. If you discussed it in the interview, confirm the letter has what you agreed upon. If not, reach out to the hiring manager to find out if it’s an error. If you didn’t discuss salary and the numbers are lower than expected, you have the right to negotiate your salary. You don’t want to agree to something that makes you feel undervalued,” says Susan Joyce, owner and operator of Job-Hunt.org.
If the salary listed on the offer letter is in a different format than what you’ve previously discussed — i.e. a bi-weekly paycheck amount — “do the quick math to make sure it adds up to the yearly negotiated salary,” recommends Krystal Covington, Director of PR at Natural Grocers and CEO/Founder of Women of Denver.
“Communication discrepancies can happen between the negotiating table and the HR department, so it’s important to verify that everything is solid before you make the paperwork final,” Covington adds. “I have personally had to reference my offer letters in conversations with HR departments when they’ve mistakenly put the incorrect salary or vacation time in the system. I’ve also had this happen [during] yearly raises and have had to bring the paperwork up for evidence that I’ve been paid incorrectly. Although most people don’t have my bad luck with HR mishaps I would still suggest keeping records to ensure you always have backup when something goes wrong.”
While the annual salary will probably be the figure that catches your eye the most, take heed of the bonus system description as well.
“Money matters can get incredibly messy — so making sure that both your salary and any guaranteed bonuses that you were told you’d get are clearly stated in the letter is critical,” Streif says. “This way, if in the future you are denied a bonus, you can pursue it as a breach of contract if necessary.”
And beware of wishy-washy language being used to describe bonuses.
“Know at least the basics of target percentage, timing (annual vs. monthly) and criteria, such as whether it’s discretionary or guaranteed,” says Jill Santopietro Panall, HR Consultant/Owner of 21Oak HR Consulting, LLC.
From parental leave to free lunches and even pet insurance, companies offer a number of perks — and while you can’t expect all of these to be explicitly stated in your offer letter (more commonly, they’ll be in the employee handbook), there are a few key benefits you should look out for.
“Some of my clients want to throw the kitchen sink in their offer letter and that’s not necessary, especially for standard policies covered in the employee handbook (such as how many bereavement days you get and when you can eat lunch),” says Santopietro Panall. “However, the letter should contain anything special that you have negotiated… such as extra vacation time, a paid cell phone, a company car, or bonus potential. It’s fairly easy for a hiring manager to say ‘Oh, I never said you could have four weeks of vacation’ after you start and, without any written record, you’re probably stuck with the company minimum.”
Besides that, Case advises “[checking] to see if any other hidden perks are mentioned.” After all, you can’t take advantage of what you don’t know about!
6. Confidentiality and Non-Disclosure Agreements
Non-disclosure and confidentiality agreements are standard practice in offer letters. Typically, they state that you must keep sensitive information that you learn in your tenure at a company private, or else face consequences such as firing or lawsuits. This may cover financial reports, communications, product design, or any other number of internal items.
It’s best to stay on the safe side and keep any non-public information that you learn at your job private, but if you’re the kind of person who has a particularly hard time keeping a secret, it’s worth looking into what exactly you need to keep on the down-low and what will happen to you if you don’t (nothing like the added threat of litigation to help you keep your lips sealed).
7. Non-Compete Clause
One of the most overlooked yet critical components of an offer letter that came up repeatedly in our conversations with legal and HR experts was the non-compete clause, which Rocket Lawyer defines as “a contract between two parties, where one party agrees not to compete with the other for a period of time.”
“These agreements can severely limit the employee’s ability to seek other employment down the road. For example, the employee can be prevented from working in his or her industry for some period of time within the geographic region where he/she is working. Therefore, to seek new employment, the employee would then have to wait for the agreement to lapse, move to another geographic area, or change industries,” says Andrew Horowitz of Obermayer Rebmann Maxwell & Hippel LLP. “Since this can have severe ramifications for the employee’s life, it is important to be sure that you are not entering into such an agreement without careful reflection.”
8. Non-Solicit Agreements
Another legalese term to look out for is non-solicit agreement, says Horowitz. This is a contract in which an employee agrees not to solicit their employer’s customers for a certain period after leaving the company. You might be tempted to one day quit your job and start your own business using the relationships you’ve built with customers, but if you’ve signed a non-solicit agreement, be careful — the ramifications are significant.
9. At-Will Employment
At-will employment means that an employee can be dismissed by their employer at any time and for any or no reason at all (barring cases of discrimination, retaliation, and other special circumstances). This may sound a bit alarming, but it doesn’t mean that your company will go around firing people on a whim — it’s simply the law of the land for most of the United States. And, on the flipside, it means that you as an employee are entitled to leave your employer at any time, regardless of reason.
10. Arbitration Clauses
The final tricky provisions to look out for are arbitration clauses, which state that any disputes that arise between an employee and an employer must be settled by a neutral third party — i.e., not through a lawsuit. Streif advises looking out for these as they “could potentially give you legal headaches down the road.” Often, she says, “employers will try to slip these in and it can cause issues if you try [to take] your employer to court some day… Protect yourself and make sure that you are aware if these agreements are in your offer letter.”