Hiring Series: Making a Written Job Offer

I’ll tell you a secret:  no matter how wonderful their staff is, all Small Business owners complain about employees behind closed doors.  In my twelve years of being in the inner circle,  I have never once encountered another business owner who didn’t vent about employees given the chance.  Rarely the complaints are serious, like the time my friend Ann, who owns a bakery, shocked me by casually remarking that she just assumes that every employee, yes every employee, will steal cash from her.  Sometimes the sounding-off is akin to how one may jokingly diss their spouse among good friends: complaints of the rolling the toothpaste vs. squeezing variety.  But usually, what I hear is frustration on the part of the employer that the employee is not doing what is expected of him or her.  This is frequently due to a lack of communication to the employee of these expectations.  Many of these miscommunications can be avoided with a strongly-worded written job offer at the time of hire.

Small Businesses, especially those with several family members involved, and non-profits can be particularly vulnerable to employee/employer misunderstandings because of the pervading atmosphere of trust that permeates them.  Some individuals tend to feel that insisting upon a comprehensive and specific written job offer is not consistent with a good faith offer and sets up a relationship based on distrust.  I disagree with this philosophy.  An effectively-written job offer communicates to the potential employee what is expected of him or her and what can be expected from the employer.  It creates security for the recruit and reminds the employer of their responsibilities to the employee.  It also assists a prospective employee in determining if a job meets their needs and goals.  Additionally, it can be used as an objective reminder to employees who are not fulfilling the requirements of their position.     

An especially disastrous instance of an employment-gone-bad due to a lack of a well-written job offer occurred a few years ago at a non-profit organization with which I was involved.   We were looking for a second-in-command executive.  Looking back, there were several mistakes we made in the hiring process, but the biggest was a very loosely-worded job offer.   The description of the full-time position was the job title and a vague listing of the areas of oversight; the compensation was noted as the salary; benefits were noted as full.  Our candidate, whom I’ll call Nick, was perfect; he was our first choice.  He was enthusiastic, ideally qualified, and couldn’t wait to start.  It was a nasty affair almost from the beginning.  Nick is European, and apparently what is considered “full time” in his country is not quite exactly the same as what Americans consider “full time.”  This began to cause some resentment among co-workers, who felt he was slacking on the job, and individuals whom the non-profit served, who felt Nick was not always available to address their needs.  When this was brought up with Nick, he was confused.  He was working full time!  What did we expect?  It also turned out that “full” benefits in the States are not quite up to par with “full” benefits in jolly old England.  He couldn’t believe that he actually had to pay $10 every time he went to the doctor.  (Never mind what happened when his wife had twins!)  That caused resentment on his part, as Nick felt his compensation had been over-stated.  The conflicts went on and on.  In the end, Nick returned to London, not even on speaking terms with his former boss, under the cloud of a threatened lawsuit.  The non-profit lost many of its supporters, plunging it into financial distress.   Now, years after Nick has returned to Europe, vitriolic words are still expressed when the issue is brought up and many relationships are irreparably damaged.    All of this could have so easily been avoided, if only the hiring team hadn’t wanted to seem distrusting.  And the ironic thing of it all is, Nick was great at his job. 

Bottle Washer and I haven’t always used written job offers.  Bottle Washer is a seat-of-the-pants type of guy.   I think this is asking for trouble.  Bottle Washer thinks it allows for more flexibility.  I, on the other hand, am a planner.  Specifically I am a planner for everything that can go wrong.  Bottle Washer thinks this is paranoia.  I think it is warding off potential problems.   But, Bottle Washer has to admit that my “paranoia” has helped us to avoid some pretty sticky situations, and now we always present any job offer, no matter for what position, in writing.

These are the things Bottle Washer and I include in a written job offer:

1.  State the compensation amount and whether it is salary or hourly.   

2. Specify any vacation time being offered, including the following details: 

  • Number of days or hours of paid vacation time allowed per year
  • If time accrues monthly or annually
  • “Black out” periods when vacation time may not be taken
  • Wait time before vacation begins to accrue or is allowed to be taken
  • Can vacation time be carried from year to year, or do unused days expire at end of year?
  • Can unused vacation be turned in for cash?

3.  Specify if the employee may take additional unpaid vacation time.  If so, how much and when?    

4.  Declare what health benefits are included in the offer, as well as:

  • What portion, if any, of the premium will be paid by the employee?
  • If coverage will be for the employee only or his/her family as well.  If for the employee only, will the employee have the option of paying the additional premium for family coverage?
  • If the plan is a high-deductible plan, will the employer pay any of the deductible?
  • Inform the employee of the specific coverage details as well as their financial responsibility, including deductibles, co-payments, and coinsurance
  • If the plan has a network, identify the network and the out-of-network coverage, if any 

5.  Specify the expected work hours, in both hours per week and daily hours.  For example, “The work hours are 20 hours per week, 9am-1pm Monday through Friday.”  This area seems to always cause tension between employees and employers.  Think carefully about what your Small Business needs.  If you open your shop at 9am, do you want your employee to be unlocking the door at 9, or do you want him there by 8:45 so that the lights are on and the register is up when the first customer walks in at 9?   I always include a statement to the effect of “subject to change based upon the needs of the business” so that I can adjust employee schedules in unusually busy or slow times as needed, although I always try to be fair.

6.  State any pre-employment requirements that must be met before the first day of work, such as completion of a course of study or passing a qualifying exam.

7.  State any qualifications that must be maintained as a condition of employment.   This could be membership in professional organizations or carrying a specialized type of insurance, for example.

8.  Inform the potential employee what documents they will be expected to sign as a condition of their employment, for instance a Non-Compete Clause and a Confidentiality Statement.  (These will be discussed in greater detail in a future post.)

9.  Include a thorough job description that states job title, primary responsibilities and tasks, areas of oversight, title and number of any employees reporting to the position, to whom the position reports, and objective goals for the position.  (Job descriptions will also be discussed in a later post.)

10.  Specify the frequency of performance reviews and name the reviewer.

11. Outline any profit-sharing or retirement plan.

12.  List any other benefits included with the offer.

A comprehensive job offer can protect your Small Business by helping to avoid employee problems before they arise and also serve as a reminder to employees who drift off course.  

Do you use written job offers?  If so, what do you include?  If not, why not, and has this caused any problems for your Small Business?

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