Difference Between an Offer Letter & an Appointment Letter

Offer letters and appointment letters play an important role in the hiring process. These documents confirm a candidate’s selection for a job role and the agreed terms of employment. However, people often mistake them for the same document. While both documents are crucial, they serve different purposes—one confirms the job offer, and the other finalizes the employment details and job specifications. In this blog, we will explore the top differences between an offer letter and an appointment letter and their respective purposes.

What is an Offer Letter?

An offer letter is a formal document employers send to selected candidates. It includes important job details such as the job title, terms of employment, primary responsibilities, joining date, work schedule, and salary details. 

Employers often use this letter to confirm the job offer and get the candidate’s acceptance before signing the full employment contract. It also helps streamline the onboarding process, making the transition of the new employee into the company smoother. 

Here are some of the key details that are included in an offer letter.

• Candidate’s name
• Joining date
• Employment type (full-time, part-time, or contract)
• Salary and compensation package
• Work location
• Job title
• Work schedule
• Start date

Pro Tip: To learn the difference between an offer letter and an appointment letter, learn more about their formats. Check out our guide on offer letter format and appointment letter format to understand how to write them better.

What is an Appointment Letter?

An appointment letter is a legally binding document that employers issue to candidates who have accepted a job offer. It confirms the commitment of both the employer and the employee to the agreed terms and conditions.

Additionally, it marks the official start of the employment. Moreover, candidates are also required to sign and return a copy of the appointment letter to the employer, confirming their acceptance of the job and its terms. Some of the vital details included in an appointment letter are as follows.

• Job title
• Joining date
• Employment terms and conditions
• Primary duties and responsibilities
• Contact details
• Bonds (if any)
• Employment type

Pro Tip: Besides an offer letter and an appointment letter, there is a joining letter. It is usually written by an employee. If you want to know the process of writing an impressive joining letter, check out our detailed guide on how to write a joining letter?

The difference between an Offer Letter and an Appointment Letter

Understanding the key differences between an offer letter and an appointment letter is crucial to smoothly streamline the recruitment process. Companies need to be aware of how to improve the recruitment process for effective hiring of candidates. 

We have listed the top differences between the two in the following table:

Factors	Offer Letter	Appointment Letter
Purpose	– An offer letter is the first document an employer gives to a potential employee.  – It formally confirms the employer’s intent to hire the candidate for a specific role.  – The letter includes key details like the job title, salary, benefits, and basic terms of employment.	– After the candidate accepts the terms in the offer letter, the employer issues an appointment letter.  – This formal document confirms the candidate’s acceptance and provides additional details, such as the start date, work schedule, reporting structure, and other important information.
Content Depth	– The offer letter gives candidates a concise and clear summary of the job offer. Employers use the offer letter to outline key job details before the candidate officially accepts the position.  It usually includes: 1. Job title and responsibilities Salary, bonuses, and benefits 2. Employment type (if the role is full-time, part-time, or contract-based) 3. Employment start date Any conditions for employment, such as background checks, drug tests, and so on. 4. Basic terms and conditions	– An appointment letter ensures that both the employer and employee understand the job terms before starting employment.  It is a detailed document that includes: 1. Clear employment terms and conditions 2. Reporting structure and hierarchy 3. Probation period details (if applicable)Confidentiality and non-compete clauses 4. Employee responsibilities and expectations 5. Required documents such as proof of eligibility and certifications.
Legal Implications	An offer letter states that the company is providing the job role to the candidate.  However, it is usually not a binding agreement. It formally shows the employer’s intention to hire and does not create a contract until the candidate accepts it.	Once the candidate accepts the offer letter, the appointment letter becomes legally more important. It is a binding document that clearly states the terms and conditions of employment.  Both the employer and the employee must follow these terms throughout the employment period.
Negotiation and Flexibility	Employers usually keep the offer letter flexible and open to negotiation. This provides further opportunities for negotiation in the future, such as salary details or non-monetary benefits to match the candidate’s preferences and expectations.	Less opportunity for negotiation is available after receiving the appointment letter. The terms and conditions in the appointment letter are final, and any changes require mutual agreement and formal amendments.
Communication Style	Employers often write the offer letter encouragingly to create a good first impression. They use a positive and welcoming tone to make candidates feel valued and excited about joining the company.	Appointment letters use a formal and detailed communication style. Employers write them in a professional tone with clear and specific language to outline the employee’s expectations and responsibilities.
Future Reference	The offer letter doesn’t include all the details needed for daily work. It marks the beginning of the employment relationship.	The employer keeps the appointment letter in the employee’s file as an important record. Both the employer and the employee can refer to it throughout the job for clarification or to resolve any disputes.

Pro Tip: Employers are often required to write a clear and concise leave approval letter while confirming a paid leave. Check out our popular guide on how to write a leave approval letter for key insights.

An Overview of Offer Letter vs. Appointment Letter

There are two key documents to ensure a successful recruitment process after conducting job interviews. The first document is the initial offer letter, which is presented when a candidate makes it to the shortlist. Then, there is the subsequent appointment letter, which follows after the candidate accepts the terms outlined in the offer letter. To better understand the difference between an offer letter and an appointment letter, let’s examine a few more details:

Criteria	Initial Offer Letter	Employment Appointment Letter
Primary Function	The document serves to formally invite the candidate to join the organization and outlines the basic terms of employment.	This document establishes the official employment relationship and provides comprehensive terms and conditions of employment.
Timing	The document is issued immediately after the successful completion of the interview process and internal approvals.	This document is generated only after the candidate has accepted the initial offer and agreed to the preliminary terms.
Response Required	The candidate must provide formal acceptance of the preliminary terms and conditions outlined in the offer.	The candidate must acknowledge and sign the document to formalize the employment relationship.
Withdrawal Impact	While not ideal, withdrawing after accepting this document is considered less severe and may be managed with proper notice.	Withdrawing after signing this document is considered a serious professional breach and may have legal implications.
Impact on Other Applicants	Other qualified candidates remain in consideration and may be contacted if the shortlisted candidate declines the offer letter.	Upon issuance of this document, all other candidates are formally notified that the position has been filled.
Document Nature	This document serves as an exploratory step in establishing a potential employment relationship.	This document represents the final, official agreement that governs the employment relationship.

Conclusion

Understanding the differences between an offer letter and an appointment letter is essential for both employers and job seekers. Whether you are accepting a job or issuing employment documents, knowing the role of each letter can help set clear expectations and avoid misunderstandings. While an offer letter extends a job opportunity with basic details, an appointment letter finalizes the hiring process with legally binding terms. Recognizing these differences can help you make more informed decisions and ensure a smooth hiring process. Additionally, if you are interested in different kinds of employment letters, check out our comprehensive guide on employment confirmation letter format for samples and key insights.

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