A letter of intent is a non-legally binding written gesture and agreement between candidate and prospective employer that outlines the terms of employment and says that we agree in principle to pursue this proposed relationship to the best of our ability, and to the exclusion of all others, and that barring some extenuating circumstance such as an inability to create a mutually agreeable employment contract, we will be working together.
It is the hiring organization that outlines the basics of the offer — salary, job obligations, and termination provisions which can save you time and money in attorney’s fees. It helps ensure that what was agreed upon verbally ends up in the final contract. “With a letter of intent, you can make sure you and the practice are on the same page before a contract is drafted,
A Letter of Intent is seen as a candidate reaching an enormous mental milestone within the interview process, as most candidates with any scruples will not sign a letter of intent, lest they truly, truly intend to take the position. Moreover, it is generally accepted that once the letter of intent is inked, the easier it will be for the candidate to take the step of inking the contract itself.
- Make sure there is a warm, heartfelt tone. Most properly drafted employment contracts are dry and unforgiving, so make the LOI serve the functioning of buffering the contract with some “warm fuzzy” sentiment…but don’t overdo it. Have someone else read it, like your physician recruiter, to see if you have laid it on too thick;
- Be sure and hit all the highlights of the employment agreement, such as pay, benefits, term of contract, etc., but there is no need to include anything that could be seen as a negative, like non-competition language. Since the LOI is not a legal agreement, why would you include within it something like a “non-compete” which concerns termination of employment, when employment has not even been established?
- Notwithstanding the foregoing about being warm and heartfelt, also be as brief and succinct as possible. The candidate will probably have plenty of reading to do when it comes to the contract itself so no need to overdo it with an unnecessarily verbose LOI. A single page is adequate;
- Make sure it is clearly spelled out that the LOI does NOT constitute a legally binding agreement as failure to do this will make it much less likely of getting a signed LOI;
- Have a place on the LOI for the prospective candidate to sign, but also have a place for the representative of the hiring entity to sign and make sure it is already inked by this person prior to presenting the LOI to the candidate. There is something nice about receiving an LOI already half-executed in blue ink. It makes the offer all the more real (yes, this may sound cheesy, but this is true);
- Most importantly, do not consider the recruitment process to be over once the LOI has been signed and that the contract negotiation period is a mere formality. While a signed LOI is encouraging and a great sign, you are a LONG way from home before you have a new addition to your practice;
- As soon as feasible after the mutual signing of the LOI, formal contract review and negotiation should begin. The longer you wait to get to a mutually agreeable the contract, the more likely you are to not ever get there. You never know… physician recruiters abound and they might just pop up with a better offer before you have made a legally binding agreement.
Date
Candidate
Address
Re: Letter of Intent, Proposed Recruitment Arrangement
Dear Dr. Candidate:
We are very pleased that you are interested in relocating to the ________Valley area to establish a practice in the specialty of _________. On behalf of ____________ (Group”), we are prepared to move forward with discussions regarding a mutually agreeable recruitment assistance package based upon the following parameters:
_____________ will provide a $___________ per year base (net income guarantee or salary) for 12 months. This is inclusive of all necessary/approved practice operational expenses and inclusive of appropriate benefits defined in the Income Support Agreement.
___________ will provide up to ($)__________ in moving expenses.
_____________ will provide Assistance necessary to establish full-time practice at __________________
All amounts advanced by ____________ will be treated as a loan. This loan will be forgiven over a 3 year period beginning after the end of the income guarantee if you continue to provide professional services in the specialty of _________________ to the __________ community on a full-time basis during this period and otherwise continue to comply with the terms of the recruitment agreement, such as required active privileges on the ________________.
If these basic terms are acceptable, please sign in the space provided and we will begin the preparation of the recruitment agreement. The recruitment agreement will incorporate the terms described above, along with a much more detailed description of each of our respective obligations.
Please keep in mind that the purpose of this letter is merely to outline the basic terms of the proposed recruitment arrangement and to establish a ‘good-faith’ agreement between __________ (candidate) and _____________ that the ______________ will discontinue seeking candidates for this position and the “Physician” will discontinue all consideration of other practice opportunities until the Practice Agreement is signed.
_____________________________________ __________________________________
Organization Job Title
_____________________________________ __________________________________
Organization Representative Printed Name Candidate Printed Name:
_____________________________________ _________________________________
Organizations Representative Title Candidate Signature
Date: _______________________________ Date ______________________________
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