Generating an Offer

Purpose of Process:

To verify the qualifications of the candidate, to maximize the probability of hiring the candidate, and to maintain pay equity.


Recommended Steps in the Process - Without Automation (See Automated Process Below):

  1. During the interview process, ask the candidate for their salary history (especially their last salary), salary requirements, and references. The application form should request this information too (see sample). Also, assess the candidate's interest in the position for which they are interviewing (see interviewing process).

  2. Start the offer process when the hiring manager decides on which candidate to hire.

  3. Ensure that the Application form is complete and signed. If the company conducts pre-employment credit checks, have the applicant complete the Pre-Employment Credit Check form. (See also the summary of the Consumer Credit Reporting Act of 1996.) If the company conducts pre-employment drug screening, the application form should contain the applicant's signature of acknowledgment (Also see the pre-employment drug-screening process and the comments under "Tips" below.)

  4. Check references (see sample reference check form) and verify degree attainment with the college/university.

  5. Contact the candidate to assess their interest in the position and determine if they have concerns:
    • Ask the candidate what they liked about what they saw and heard in the interview. Reinforce those comments (e.g. "Yes it is a good work group," etc.) This starts the discussion on a positive note.
    • Ask the candidate if they have any concerns. If the candidate does raise a concern, acknowledge it and make the candidate feel okay for having the concern. Ask if there are any other concerns.
    • Address the concern. Offer to have the hiring manager discuss it with the candidate. Resolve the concern before extending the offer.

  6. Generate an Employment Offer Worksheet (see sample) to compare salaries, degrees, and experience of the candidate with employees in the same job category. Also, review the market data and consider the candidate's requested salary.

  7. Generate an equitable salary offer recommendation.

  8. Obtain the approval of the hiring manager and other management, as necessary.

  9. Generate an offer letter (see sample offer letter).

  10. The hiring manager verbally extends the offer. The offer letter is either mailed/emailed to the candidate, or the candidate may request to pick up the offer letter.

  11. If the candidate accepts:
    • Negotiate a start date. Sooner is better.
    • Prepare the candidate for a possible counter offer from the current employer. (Those who accept a counter offer seldom remain long with the employer.)
    • Discuss emotional difficulties, if any, with submitting a resignation. (e.g. ask: Do you think it will be hard to inform your manager of your resignation?)
    • Make arrangements for the employee's pre-employment drug test, if applicable, and discuss reasonable accommodation of a disability, if applicable (see the American's with Disabilities process).

  12. Maintain contact with the candidate to ensure that he/she does not change his/her mind before starting the new job. Have the manager contact the candidate frequently and/or take the candidate to lunch during the interim.

Recommended Steps in the Process - Automated using HRSnetSource:

  1. During the interview process, ask the candidate for their salary history (especially their last salary), salary requirements, and references. The Online Employment Application should request this information too. Also, assess the candidate's interest in the position for which they are interviewing (see interviewing process).

  2. Start the offer process when the hiring manager decides on which candidate to hire.

  3. Ensure that the Application form is complete (you can also print the application form from HRSource). If the company conducts pre-employment credit checks, have the applicant complete the Pre-Employment Credit Check form. (See also the summary of the Consumer Credit Reporting Act of 1996.) If the company conducts pre-employment drug screening, the application form should contain the applicant's signature of acknowledgment (Also see the pre-employment drug-screening process and the comments under "Tips" below.)

  4. Verify degree attainment with the college/university and check references.  Record the results on the Reference tab on the Applicant Process screen.  You can use the sample reference check form as a guide for questions to ask.

  5. Contact the candidate to assess their interest in the position and determine if they have concerns:
    • Ask the candidate what they liked about what they saw and heard in the interview. Reinforce those comments (e.g. "Yes it is a good work group," etc.) This starts the discussion on a positive note.
    • Ask the candidate if they have any concerns. If the candidate does raise a concern, acknowledge it and make the candidate feel okay for having the concern. Ask if there are any other concerns.
    • Address the concern. Offer to have the hiring manager discuss it with the candidate. Resolve the concern before extending the offer.

  6. Use a standard report in HRSource, such as Employees by Job to compare salaries, degrees, and experience of the candidate with employees in the same job category. Also, review the market data and consider the candidate's requested salary.  Market data can also be stored inside HRSource™.

  7. Generate an equitable salary offer recommendation.

  8. Obtain the approval of the hiring manager and other management, as necessary.

  9. Use HRSource to generate an offer letter.

  10. The hiring manager verbally extends the offer. The offer letter can be emailed to the candidate directly from HRSource.

  11. If the candidate accepts:
    • Negotiate a start date. Sooner is better.
    • Prepare the candidate for a possible counter offer from the current employer. (Those who accept a counter offer seldom remain long with the employer.)
    • Discuss emotional difficulties, if any, with submitting a resignation. (e.g. ask: Do you think it will be hard to inform your manager of your resignation?)
    • Make arrangements for the employee's pre-employment drug test, if applicable, and discuss reasonable accommodation of a disability, if applicable (see the American's with Disabilities process).

  12. Maintain contact with the candidate to ensure that he/she does not change his/her mind before starting the new job. Have the manager contact the candidate frequently and/or take the candidate to lunch during the interim.


Process Tips:

For critical offers, or offers where the salary doesn't meet the candidate's expectations, consider a hiring bonus. Also consider personally delivering the offer to the candidate, perhaps over dinner. If the candidate is requesting a salary that cannot be equitably achieved, don't extend the offer. This may be a difficult decision in the short run, but doing otherwise could be costly in the long run (in terms of morale, turnover, and the cost of equity based salary adjustments).

When presenting the offer, sell all the elements of the compensation package. If part of the offer package includes equity (stock options), make sure the candidate understands how stock options work and how they should be valued. Mention all the unique benefits that the company offers, including those that don't have a specific financial value, such as company environment, career enhancing work assignments, etc., as applicants place value on these too.

Some companies require pre-employment drug testing, although this is less common with smaller companies. To implement pre-employment drug testing, the employment offer letter must include language that makes the offer conditional upon passing the drug test (see sample language) and the application form should contain section in which the applicant acknowledges the pre-employment drug screening. Also arrangements must be made with a reputable lab to conduct the drug test. Refer to the pre-employment drug testing process for more information.

More and more employers are using personality tests on applicants. These tests can be legal as long as they do not have an adverse impact on minorities or members of a protected group. The ADA requires that the tests not be medical (i.e. provide evidence that would lead to identifying a mental disorder or impairment). Public employees have privacy protection against unreasonably intrusive and non job-related questions.

A recent survey sponsored by the Society for Human Resource Management and Dow Jones & Company showed that the majority of hiring managers and interviewees expect to negotiate. Here are some tips on negotiating with applicants:

  • Listen to the candidate about their skills and ambitions
  • Be creative and flexible - it takes more than salary to attract top candidates
  • Be willing to walk away from the negotiations - have alternative plans in mind
  • Don't worry about being liked - giving things freely away can forfeit respectability and credibility
  • Appreciate the process as a way to learn what will attract, retain and motivate the top candidates

As the process illustrates, using an applicant tracking/offer system such as HRnetSource can streamline the process, eliminate paper and facilitate documentation.

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