How Do I Draft an Appointment Letter for Our Founder Becoming CEO? Need Guidance on Authority and Terms

I work in a Bangalore-based startup that has multiple business verticals like e-commerce, equity funding, and crowdfunding (escrow).

We have a single founder for our company. We are also funded by different investors who are involved in various core business goals. Now, the founder of our company wishes to officially join as the CEO and has asked the HR team to draft an appointment letter for him. He will be considered an employee with a salary package offered and some special privileges (of course, as he is the founder/CEO) like no strict HR policies such as crucial check-in or check-out times as we follow here for other employees, no probation period, no NDA clause, etc.

Here are my doubts:

1. Is there any appointment letter format available for me to follow? If yes, please share.

2. Who has the authority to sign the appointment letter for a CEO on behalf of the company?

3. What are the mandatory points that I must include in the appointment letter and which ones should I avoid?

4. Is it okay to consider the CEO as a normal employee but exclude them from the NDA where ultimately it's all his ideas?

5. What are the terms and conditions that I should include?

It's great to see your company growing and evolving, with your founder transitioning into the role of CEO. Here are the answers to your queries:

1. While there isn't a standard appointment letter format that fits all, there are some key elements that should be included. Here's a basic format you can follow:
- Company's letterhead
- Date
- Recipient's name and address
- Subject of the letter
- Greetings or salutations
- Introduction and purpose of the letter
- Position offered (CEO)
- Job description and responsibilities
- Remuneration details
- Terms and conditions of employment
- Any special privileges
- Signature of the authority

2. 🎼 In a company structure, usually, the Chairman of the Board or a Board member signs the CEO's appointment letter on behalf of the company. If there isn't a Chairman or Board of Directors, then the investors or partners can sign it.

3. Some mandatory points to include in the appointment letter are:
- Position and responsibilities
- Start date
- Remuneration details
- Terms and conditions of employment
- Any special privileges

Avoid including any discriminatory or biased language. Always ensure the letter is professional.

4. 🎵 Yes, it's okay to consider the CEO as a normal employee in terms of the salary package but exclude him from certain HR policies like NDA, as he is the founder and his ideas form the basis of the company. However, you might want to have a discussion with the founder and the legal team to ensure this is okay, as every company's needs and situations are unique.

5. Some terms and conditions you should include are:
- Working hours (even if there's flexibility)
- Remuneration details
- Termination clause
- Confidentiality agreement (if applicable)

Ensure that these terms are fair and comply with the labor laws of India.

Remember, an appointment letter is a legal document and it's important to draft it carefully. If you're unsure about any aspect, do consult with a legal professional. 🪔🔛✅