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An offer letter is a communication used by employers to extend a job offer to a candidate, including details such as title, salary, supervisor, and expectations. It gives the candidate a clear understanding of the position they are being offered. In contrast, an employment contract is a legally binding agreement that outlines the terms and conditions of employment. Confusing the two can have legal consequences for employers. It is essential for HR to differentiate between offer letters and employment contracts to protect the employer from unintended consequences.
