MaRS Library Employment agreement (sample template): Using employment agreements and job offer letters
When recruiting, once you have selected your final candidate, it’s time to put together your job offer. Your job offer can include both an offer letter and the employment agreement. Below, you can download a sample template of an employment agreement.
Before you prepare your job offer letter and employment agreement, make a verbal offer. A verbal offer allows you to outline key aspects of the offer and ensure your candidate is likely to accept your formal offer, once prepared. If you cannot agree on key issues at the verbal stage, you may need to move on to your second choice before preparing formal documents.
The job offer letter and employment agreement
A job offer letter is an opportunity to welcome your new team member in a warmer, more personal way, and highlight the key aspects of the employment agreement. An offer letter may also serve as a cover letter when a legal employment agreement is deemed appropriate.
As your company grows and your employment offering is well defined and standardized, you may be able to avoid using individual employment agreements—except in the case of executive positions where a legal agreement is always recommended.
Employment agreements and standardized employment policies
Seek legal advice to learn more about when your startup’s employment policies may be sufficiently standardized so that employment agreements may no longer be necessary.
Should your startup require the use of an employment agreement, a downloadable sample template of an employment agreement is available below.
It is recommended that your startup seek legal advice and customize an agreement that meets your specific needs.
Sample employment agreement template
What should the job offer letter include?
Your job offer letter should include:
1. A brief but positive introduction
2. Highlights of the offer, with a reference to the formal employment agreement for additional details (if applicable). These highlights would generally include:
- The title of the position in the employment agreement
- The identity of the manager or supervisor
- A brief explanation of the position’s scope of responsibility
- Clear information about compensation, including:
3. Confirmation of the start date discussed during the verbal job offer conversation
4. A brief reference to the general benefits offered to all employees, if applicable. These benefits may include:
- A group RRSP
- Medical or dental coverage
- Life insurance
- Disability insurance
What should the offer package include?
Your offer package should include:
- The job offer letter
- The employment agreement, if applicable
- A non-disclosure agreement, if this is not covered within the employment agreement
- A summary of employee benefits and how the programs work (your insurance carrier or consultant can usually provide this)
If no legal agreement has been prepared, then ensure you provide additional details on how your plans work. For example, clarify:
- How often payroll is processed
- How bonus or sales incentives will be earned, including sales targets or business objectives, the calculation methodology, the timing of payments, and other applicable terms and conditions
- How the stock option plan works
- How the vacation policy works