People Management Recruiting and Hiring

Interview notes can be a binding contract

Business Management Daily Editors
Business Management Daily Editors
Published: May 24, 2007
Updated: June 11, 2019
Managers may believe that agreements must be in writing to be deemed legal employment contracts. But that’s not true. Under the right circumstances, oral promises made by supervisors can be enforced as contractual agreements. That’s especially true if employees or applicants have something in writing to back up their claims, such as handwritten notes. As the following case shows, written notes, particularly those signed by a manager, may be enough to bind employers.

That’s why managers should never sign anything an applicant or employee hands them without prior HR approval. Better yet, have an attorney review any such documents. Employment contracts should be drafted by someone who represents your organization’s best interest, not by employees.

Recent case: During Robert Baum’s job interview with Helget Gas Products for a sales position, he told the company president and another manager that he needed a three-year contract. Baum took careful notes of the discussion, including the company’s descriptions of his expected salary, bonus payments, job duties and benefits. After he accepted the job, Baum took his handwritten notes, wrote “Contract with Helget Gas Products” across the top and gave them to the manager, who signed the notes.

A year later, the company fired Baum for not meeting sales goals. He fired back with an employment-contract lawsuit, alleging that the company had guaranteed him three years of work. Unfortunately for the company, a court found that the notes signed by the manager did create a contract. The interview notes were silent on the issue of sales targets. (Baum v. Helget Gas Products, No 05-2142, 8th Cir., 2006)

Legally smart job offers: 4 do’s and don’ts

Only a few misplaced words during a job interview can lock your organization into an employment contract with a new hire. Avoid creating promises by following these job-offer tips:

  1. Do explain that the candidate is being hired “at will,” meaning your organization can terminate his or her employment at any time for any nondiscriminatory reason. Include at-will statements in offer letters and employee handbooks.
  2. Don’t imply job security with statements such as, “You’ll be able to grow here” or “You have a long career here.” Specify the job’s starting date, but keep out any reference to length of employment.
  3. Do clarify that continued employment depends on several things, including following organization policies. Cite job-offer contingencies, such as signing a nondisclosure agreement or drug test.
  4. Don’t ask new hires to sign offer letters. But keep a copy in your files. If you make the offer orally, keep notes of what you promised.

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