Is It Right to Keep the Original Offer Letter When an Employee Leaves? Seeking Legal Insights

Hello, as mentioned in every previous post, I work as a junior HR in a startup company (2 years old) that is in the media and IT services industry.

Company Policy on Offer Letters

According to our company policy, the original copy of the offer letter is retained by us, while a photocopy is provided to the employee upon joining. I am curious to know if the original offer letter is given to the employee upon their departure, as one employee has inquired about this.

Managing Director's Stance

My Managing Director has stated that we do not provide the original copy upon exit because doing so would mean we lack proof or documentation of the employee's tenure with us. However, as far as I am aware, there are companies that do provide the original documents.

Request for Clarification

I would appreciate it if you could clarify the correct procedure to be followed in accordance with relevant acts and laws—whether to give or not to give the original offer letter. Additionally, any related comments on this topic would be welcome.

Thank you,
Aishwarya
HR

Dear Aishwarya,

First and foremost, I request you to use the right HR terminology. Please educate yourself on the difference between "Offer Letter" and "Appointment Letter."

Understanding the Appointment Letter

An appointment letter is a contract between the employer and employee under the provisions of the Indian Contract Act, 1872. Going further, under the provisions of the Karnataka Shops and Establishment Rules, 1963, the issue of an Appointment Order is mandatory. If you wish to maintain the original copy of the appointment letter in the employee file, then you may prepare two original copies. One could be issued to the employee, and another for retention in the employee file.

Proof of Employment

You have written that "My MD says we do not give the original because if we do, then we do not have any proof or statement of his work with us." Is the attendance register not proof of employment with you? Is the monthly salary roll not proof of his employment? Is the remittance of PF or ESI (if applicable) not proof of a statement with you? During the employee's tenure, he/she will apply for leave. Is the leave application not proof of employment?

Performance Documentation

You may issue the employee his KRA sheet as per the performance cycle of your company. At the end of the cycle period, you could be measuring work and retaining the Performance Appraisal (PA) form in the employee file. Is this not a statement of his/her work?

Compliance with Labor Laws

Being a startup, I recommend you follow labor laws to the core. Else non-compliance of something could create a bigger problem in the future, and bailing out from it could consume time and energy, which will be an unfruitful activity. As of now, start issuing the original copy of the Appointment Letter once the employee joins.

Thanks,
Dinesh Divekar

I completely agree with the supporting statement and proof explained in relation to the appointment letter. Not providing the original appointment letter leads to dissatisfaction for the employee, and he or she will question the organization's culture. Instead of just retaining the original appointment letter, there should be an employee retention plan.

Manjunath
GM Operations

A practice is an 'appointment order' that is prepared, the original of which is kept with the person signing the order, and copies are sent to concerned persons. This is a typical practice in government. I beg to differ with Dinesh; there cannot be two original appointment letters. The original is only one. The practice of keeping the original may be because previously there were carbon copies, and subsequent to the second copy, the copies were blurred. Hence, for clarity, record keeping, etc., the original was preserved. Now that we do not use carbon and do take many copies on the printer, the question becomes redundant.

Regards, Vibhakar Ramtirthkar
[Email Removed For Privacy Reasons]
[Phone Number Removed For Privacy-Reasons]

Dear Mr. Vibhakar Ramtirthkar, I suggested taking two printouts on the original letterhead to satisfy the requirement of Aishwarya's employer of keeping the original with them. In fact, there is no logic in retaining the original copy in the employee documents. There is nothing wrong if the photocopy is retained. Once the employee signs, it becomes a perfect legal document.

Preparing Two Original Copies

Preparing two original copies need not be restricted only to the appointment letter. Real estate developers, when entering into a contract agreement with contractors to provide some services, prepare the agreement on two separate bond papers. Since the numbers on the e-stamp papers differ, they clearly write that "this agreement is prepared in two original copies. Sl No _____ is for the buyer and Sl No ______ is for the contractor."

Thanks,

Dinesh Divekar

Dear Aishwarya Manjunath, as an HR professional, you should inform your Managing Director that we need to retain an acknowledgment copy of HR letters for record-keeping purposes. In case of any issues, having this documentation will provide us with support. You should ensure that the original letter is given to employees, and then it is up to you whether you prefer to obtain an acknowledgment copy on letterhead or a copy of the original letter will suffice.

Please implement the practice of issuing the original letter to employees as this will help the organization build trust with its employees.

Regards,
Vijay Kumar

Dear Aishwarya,

The simple solution to this situation is to make two copies as original for any letter you issue to your employee, as explained by Mr. Divekar in his second post. Additionally, take acknowledgment from the employee in your copy whenever you issue any formal letter to him. With this method, you will always have his complete file under your control, and the employee will also have all necessary documents with him.

Warm Regards,
Sujeet S Rajawat