Legal Updates

Employment Offer Letters: Tips For Independent Schools

For independent schools, like other employers, employment offer letters are a vital means of defining the terms of the employment relationship. There are a number of different forms that offer letters can take, ranging from providing one-time documents at the outset of employment to sending letters on an annual basis.

Regardless of which approach your school follows, it is vital that your offer letters be drafted carefully and reviewed regularly, to ensure compliance with legal requirements and best practices and to avoid creating unintended contractual obligations.

Disadvantages Of Fixed-Term Contracts

Historically, many schools have employed their faculty, administrators, and even staff members under annual contracts (often in the form of letter agreements) with fixed, one-year terms. From a school’s perspective, the primary goal of this approach likely has been to minimize turnover and disruption during the school year, by inducing employees to commit to remaining employed through the end of the year. Further, it may be perceived that following practices similar to other independent schools is necessary to compete for the top candidates.

In practice, however, a court is highly unlikely to order an employee to continue working through the end of a school year, even if the employee has explicitly agreed to do so. The most a school might reasonably hope to obtain is a court injunction preventing the employee from working for another institution before the term of the contract has concluded. But even such a limited injunction is far from a certainty, and the costs of seeking such an order are likely to outweigh the benefits of obtaining it.

In addition, a fixed-term contract can severely restrict a school’s ability to terminate the employment relationship early if an employee’s performance is unsatisfactory. Unless an employee engages in some type of egregious misconduct (such as theft or workplace violence), a school is likely to find it difficult to avoid paying the employee through the remainder of the school year, even if it decides to part ways with the employee early.

At-Will Offer Letters

For these reasons, more and more schools have moved away from annual, fixed-term employment contracts, to more flexible employment offer letters. Offer letters can take a number of different forms, as outlined below. But, however it is drafted, an offer letter should make clear that the employment relationship is “at will” – i.e., that the individual is not being employed for any definite term and that either the school or the employee may terminate the employment relationship at any time, with or without notice, and for any reason or no reason at all (other than an unlawful reason such as discrimination).

Within these overall parameters, a school’s employment offer letters commonly take one of the following approaches:

• One-Time Offer Letters. Some schools provide offer letters only when individuals first become employed. (This is the prevailing practice among non-school employers.) Employees receive detailed offer letters prior to commencing employment, followed by shorter, annual updates that reference the “original” offer and detail any changes (e.g., subsequent changes in compensation, job title, job duties or other terms of employment) applicable to the upcoming school year.
• Annual Offer Letters. Other schools provide annual offer letters to employees, setting forth in detail their compensation, benefits and other terms of employment from year to year. This approach can also function well, so long as the annual offer letters are carefully drafted – in particular, to make clear that the employee will remain employed on an at-will basis, notwithstanding that the offer letter applies to a particular school year.

Important Considerations For Schools

If a school is considering moving from contracts to at-will offer letters, it should carefully consider which of these general approaches is best-suited to its culture and goals. Likewise, a school should give careful thought to how any changes in its current structure can best be implemented.

For instance, while moving from annual offer letters to one-time offer letters may help to reduce administrative burden and paperwork, a school may be concerned that if employees no longer receive annual offer letters, they may feel less committed to remaining through the end of a school year, or, conversely, may fear that the school is planning to terminate employees mid-year. Thus, if a school decides to change its offer letter structure, it should consider how to communicate the decision to employees (e.g., through letters and/or in-person meetings) in a manner that minimizes potential confusion or mistrust.

Whatever approach a school adopts, its offer letters should make clear that the employment relationship remains at will – i.e., that employment is not for any definite duration and may be terminated by the employee or the school at any time and for any reason (or for no reason), with or without notice. In this regard, an offer letter should not refer to a specific “term” of employment or promise that the school will terminate only for “cause” or only after following specific procedures (such as a defined progressive discipline process).

Of course, offer letters (and contracts) should include important, employee-specific information, such as job duties, work schedule, compensation and benefits. For new employees, offer letters should also detail expected start dates and any hiring contingencies (e.g., criminal background checks, reference checks, and proof of eligibility to work in the U.S.).

Finally, schools should ensure that their offer letters are consistent with their personnel policies, practices and documents, such as employee handbooks, job application forms and job descriptions.

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Please feel free to contact any of our education lawyers if you have questions about your school’s employment documents or would like our assistance with reviewing and updating your practices in this area.