What is the difference between offer letter and contract?

Posted on 19th Jul 2019 | 1684 views

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What is the difference between offer letter and contract?

The difference between the offer letter and contract letter is one of the key elements to setup success in your career. These terms are closely interrelated and used interchangeably. An offer letter and contract have some major differences.

What is the difference between offer letter and contract?

What is an offer letter?

An offer letter if offered to the candidates once they’ve successfully completed the interview and promised with an offer letter verbally. After that you’ll receive an offer letter. Offer letter is a formal job letter that includes following important elements.

● Job title

● Start date


● Manager’s name

●Employee benefits

●Employment relationships

An offer letter is a formal letter to provide the job details and your job responsibilities from the job role accepted by you. Once you receive an offer letter you will have 24 hours to one-week time to sign it. Otherwise the offer will expire.

What Is a contract?

Contract is also similar to the offer letter which depicts the details of a role and important information about the job role offered. Unlike offer letter a contract has a specific time period included it and used it for when employers are hiring for a certain contract period. Contracts are used in some specific positions such as:

● Freelance positions

● Temp to perm positions

● Contract positions for specific projects

Contracts are time sensitive as compared to the offer letter and it require immediate signature within about a week.

Difference between offer letter and a contract

Generally, offer letters and contracts are used for same purposes but for different types of works. While an offer letter is issued for long-term full-time role and contract is used for short term work or one that does not fit for long term employment. As a contract employee you need to work full time and you will receive all other benefits such as full-time employee.

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