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In this video tutorial, Shan Mei explains the difference between offer letters and employment contracts. Offer letters are received after passing an interview and detail agreed-upon job responsibilities and compensation packages, including salary, allowances, and leave entitlements. Employment contracts, on the other hand, are created before an employer applies for a visa and include the same elements as the offer letter. The key distinction is the legality: while offer letters outline the terms discussed, employment contracts are legally binding documents.