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In this video tutorial, the speaker clarifies the distinction between an offer letter and an employment agreement, emphasizing that they are not interchangeable terms. An offer letter is a communication from employers to candidates, extending a job offer and providing key details such as job title, salary, supervisor, schedule, and expectations. This helps candidates better understand the role they are offered. The video also addresses the legal implications of using these terms incorrectly, highlighting the importance of HR protecting the employer from potential legal issues related to misunderstandings between the two documents.