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Safeguarding Through Standards Why Organizations Should Never Undermine Letter of Appointment Best Practices

Should you ask a new recruit to resign from their current job before issuing a legal employment contract?

Let’s examine this. 

After selecting a candidate for a vacant position, you are obviously eager to kick start the employee onboarding process and have them fill the much-needed vacancy as soon as possible. 

But this is a process that usually takes a while as there are official procedures for both parties to follow. 

Typically, this process involves issuing an official letter of appointment to the candidate, followed by a contract letter, and then negotiating the terms of the contract. 

After this, only your candidate will resign (if already employed) and issue notice to their current Company. This process may take weeks and even months. 

So, the short answer is no. 

Any candidate is entitled to refuse to resign from their existing position without receiving a formal contract from you, and with good reason. 

Keep reading as I explain to you why your organization should never undermine the importance of letter of appointment best practices when appointing a new recruit.

What is a Letter of Appointment

Before we get into further details, let’s understand what an appointment letter is.

It is a kind of HR documentation letter issued to an applicant after they have been selected for a vacant position.

It is a legal document confirming acceptance of employment and that the candidate can now officially start work under the said position. 

Appointment letters are typically expected to be handled by the Company’s HR leaders

What to Include in an Appointment Letter?

In most cases, the HR systems will have a standard template in place. Here are some essential elements that a good appointment letter should include: 

  • work responsibilities

  • salary package

  • position title

  • employee benefits

  • compensation package

  • start date confirmation

  • terms of employment

  • job terms and conditions

  • employee handbook, etc. 

The appointment letter is one of the most critical steps of the joining formalities because it legally binds the last and the most important communication between the newly employed and the organization. 

Suzanne Lucas from Evil HR Lady, says that making sure you have the right information is critical to employee and manager happiness. If you make an error in salary, benefits, or even something that seems trivial, like writing the work day starts at 8:30 when really it is at 8:00, it can destroy an employment relationship. Additionally, your appointment letter needs to comply with all relevant laws. It's not a time to make a joke or be sloppy.

Mistakes to Avoid While Writing Appointment Letters

Now that you know the reporting structure of an appointment letter, it is equally important to know what to avoid. 

Read the contents below to explore some common mistakes you can avoid to ensure your offer letters are accurate, legally compliant, and reflect company policies and values. 

Vague Job Description & Expectations 

By clearly outlining the candidate’s specific responsibilities and roles associated with the job position, you can avoid misunderstandings in the future. 

Incomplete or Inaccurate Compensation Details 

To avoid misunderstandings or discrepancies, a job offer letter should be accurate about the compensation package. Clearly indicate details like base salary and additional compensation components like incentives, benefits, bonuses, etc. 

This will not only win over your employee’s trust but also help to align their expectations with the Company’s offer. 

Ambiguous Employment Terms & Conditions 

Any ambiguity in this area can potentially give rise to legal disputes in the future and negatively affect the employer-employee relationship. 

Be clear about probationary periods, notice periods, and termination conditions. Use precise language when drafting confidentiality and non-compete clauses to avoid misinterpretations. 

Make sure your appointment letters adhere to relevant employment regulations and laws. Failing to mention applicable legal statements, specific information, or disclaimers can lead to legal liabilities in the future. 

You can consult your HR Leaders or a legal counsel for this. 

Additionally, you can also ask your new recruits to go through the Company’s HR blogs for employees to get any information you might have missed in the appointment letter. 

Why Organizations Should Prioritize Letter of Appointment Best Practices

When it comes to recruitment and employment, an appointment letter is not just a routine welcome aboard formality. This is a crucial document for both the employee and the employer. 

According to Jessica Miller-Merrell the Founder of Workology.com, A letter of appointment, or offer letter, is crucial to the hiring process for many reasons, but the most important are for communication and setting expectations. A     solid offer letter ensures that all terms and conditions of employment are clearly communicated to the employee (includes details such as position, compensation, benefits, working hours, and probationary period) and this helps prevent future misunderstandings or disputes. It also sets expectations for both parties by outlining the employee's responsibilities, performance expectations, and any specific conditions of employment. This clarity helps employees understand what is expected of them and helps to align their efforts with organizational goals.

Yes, a joining letter definitely serves as an official offer acceptance form, but its function goes far beyond it. This critical document lays out the groundwork for a fruitful and harmonious professional relationship in the future.

The significance of an appointment letter goes beyond formalities to include legal legitimacy, efficient onboarding, professionalism, and clarity. Following are some of the important uses of an appointment letter. 

  • A job acceptance letter determines the organization to be abiding by all legal laws for its employees. 

  • It serves as crucial evidence for any legal entity associated with the Company. 

  • It outlines the future perspective and policy of an employee when working under the organization. 

  • It ensures employee safety in the organization while working under them.

  • Employees working in an unorganized sector can avail of certain benefits provided by the labor law by producing their appointment letters. 

  • A clearly outlined and well-structured appointment letter can reduce the chances of future discrepancies or misunderstandings between the employee and the organization. 

  • Through appointment letter best practices, organizations are able to comply with state labor laws and regulations. 

When Should an Organization Issue the Letter of Appointment?

Here is a very common question - should the organization issue the legal employment contract first, or should the candidate resign from their current job rather? 

It would be unreasonable for your organization to expect a candidate to tender resignation from their current job without a legally signed contract in place. Receiving a signed contract will give them the much-needed security and new hire confirmation that they have indeed been officially appointed. This way, they can safely quit their existing job.

Letter of Appointment Best Practices

To put it simply, the best practice for an employment agreement letter is to send out the formal appointment confirmation before expecting a new recruit to resign, even though an informal email is legally binding in a lot of cases. 

Expect to wait a few weeks, at least during the hiring process, to let your new recruit know that they have been selected and when they start work. 

Another best practice dictates that organizations must complete all background checks before issuing the letter of appointment. Take, for example, the incident of Jambojet, a budget carrier of Kenya Airways. The Company was slapped with a lawsuit for firing a flight engineer, Walter Omondi Ochieng, before he even started his new job. 

The Company’s mistake was issuing the appointment letter too soon, only to find out later about the candidate’s questionable work background. 

And since Jambojet sidestepped established best practices in processing the candidate’s employment contract, the Company had to bear the consequence of this error. 

Once employment terms of a contract are executed by both parties, it is legally not permissible to be whimsically terminated by one party without consent from the other.  

When is it Appropriate to Let them Issue a Notice First Before Giving a Contract? 

Your organization must have a track record of issuing employment offer contracts within a short period of time. 

This is typical in smaller companies as there are not many layers in the recruitment chain of command. 

This may be different for a bigger organization, where it could take weeks and even months to get a contract ready. 

With such delays, it becomes unavoidable for a candidate to take a while to issue notice to their existing Company and join their new position. 

This is why it is essential for organizations to assure their newly selected candidate that the job is indeed theirs and that they can safely resign from their current position. 

But as explained above, most recruits would feel insecure about providing notice without a legally binding job offer letter in hand. 

How to Speed Up Contract Timelines 

While it is not advisable to rush formalities and contracts during new employments to avoid rash mistakes, there are some ways to get your new hires through the door as quickly as possible. 

One way to go about it is to work internally to shorten contract timelines. If your HR department hasn’t already done it, then get ready-to-go appointment letter templates in place customized for different seniority levels and positions. 

Below, you will find other elements to put into place to speed up the employment contract process:

  • Initiate who is required to offer job approval beforehand 

  • Set in place the pay range to get the negotiations out of the way ASAP 

  • After issuing the employment terms of contract to the candidate, schedule a meeting within a few days to clear all queries from both sides

As an organization, it is only normal to want to fill empty vacancies and have new hires contributing to the team as soon as possible. That being said, it is also crucial to handle appointment letter contracts as carefully as possible to avoid potential legal headaches for both parties. 

For healthy employee relations in the future, you want them to ease into their new job as seamlessly as possible. For this reason, you can establish systems to make sure that your HR team works internally to speed up the employment contract process. 

Final Thoughts

Appointment letters are crucial documents that lay down the foundation for a healthy and fruitful employer-employee relationship. 

By setting down letter of appointment best practices in place, your organization can uphold legal requirements and effectively communicate necessary employment terms to newly appointed recruits. 

What are your Company’s non-negotiable appointment letter best practices?

Share your thoughts in the comment section below. 

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