You’ve passed through a gruelling interview process, and you just received the good news: you’re hired!
The hard part is now over, and all you need to do is to sign that offer letter to make it all official. But before you commit your name to that important document though, here’s a suggestion: read it first.
Sounds like a no-brainer?
A survey revealed that only 1 out of 166 workers fully read and understand their contracts before signing. That’s less than 1%, and this leads to many employees believing that they were unfairly dismissed.
And even if dismissal doesn’t become a problem for you, it is important for an employee to know these things, because that contract could lead you into doing more work than you bargained for, stop you from earning any extra income, and refuse to pay you overtime, among others.
And when you’ve signed on that dotted line, that’s when it’s too late to renegotiate.
So before you make a mistake that you’ll regret down the line, here’s a checklist of things to look at before you sign.
1. Your Title And Job Scope
Be very careful while reading this, because any vague phrases or job scopes could lead you into doing more work than you bargained for. It’s important to scour your offer letter for clear deliverables to your boss, and ponder whether you’d be ready to accept those responsibilities.
It’s especially important to consider whether the job scope as outlined in the offer letter tallies with the job you negotiated for during the interview.
2. Probation Period
Treat your probation period as your trial period, which normally stipulates a shorter notice period and a chance to gauge your fit in the company.
If probations are applicable, your employment letter should lay out the probation period, and quite crucially, whether they’re allowed to extend the probation period.
If no probation period is listed in your offer letter, it’s a good idea to check with your employer if this was an error.
3. Salary, Benefits, And Bonuses
It bears saying that you should take note of what your salary will be in the contract or offer letter, and make sure that it tallies with your negotiations.
And this is where your boss should list out any benefits, which can include:
- EPF/SOCSO/PCB/EIS insurance
- Payments other than your salary
- Retirement plans
- Health and wellness
- Equity or share options
- Company housing or vehicles
- Travelling/housing expenses
If you’re in a role that is supposed to pay you based on commission or bonuses, it should be stipulated in your contract, especially whether these bonuses are guaranteed, or based on performance.
If they are based on performance, the contract should include any targets you may need to hit to qualify, and who will be evaluating you.
4. Place Of Work
If it is difficult for you to relocate anywhere, then you should keep an eye out. Does your employment letter list a place of work?
If not, then you may not have any recourse for complaint if your boss suddenly moves you around later. To top it off, the company may not spot you a redundancy payment if you signed an offer letter that doesn’t stipulate a place of employment.
If you discussed possibilities of working from home, then your contract should spell this out in black and white too.
5. Start And End Dates (If Applicable)
Your offer letter should indicate a start date for your employment, and if working on a contract basis, an end date.
If you’re on contract, you’ll want to carefully scour it to see if your boss can terminate your contract before the end date.
“Employers will often include language that means the relationship remains at will, which means you still can be terminated for any reason at any time,” said a lawyer in this Monster article. “I’ve had doctors thinking they’ve locked in a three-year term, but they missed language that lets the employer terminate them with 30 or 60 days notice.”
6. Working Hours
Within the working hours on your contract, you should be sure to take note of how long you’ll be at work. Do note that in Malaysia, some work weeks stretch from Monday to Friday, while others range from Sunday to Thursday.
If you and the company have agreed on flexible working hours, it should be reflected in the contract.
Some companies don’t enforce these working hours so strictly, but do note that not adhering to it can lead to a reprimand, or even potential termination.
Your contract should also stipulate whether you’ll get paid for any overtime hours clocked, and if you’ll be required to work weekends and evenings. Will you be asked to work “all the necessary hours the job entails”? Keep an eye out for phrases like that.
7. Leave Days
Generally, the longer you work in a company, the more leave days you get. But also look out for holidays, any entitled days for sick leave, and where you’ll have to go to get certification for those sick days.
Different companies have different policies for necessary hospital stays, and how that will impact your remaining leave days.
Check with your boss if you can take extra days of unpaid leave as well on top of your existing days, if applicable.
8. Ending Your Employment
This will include the notice period that you’ll have to provide to your employer. But do note that this doesn’t mean that you’ll necessarily be working throughout your notice period.
This is when you need to be familiar with the contract to be better equipped to negotiate a favourable exit.
You may be given a payment to end your working period earlier, or you could be put on garden leave, where you’re not at work, but still getting paid and still technically an employee, so you can’t begin work in another company.
Do also check for any stipends you may get in the event of a firing.
Don’t be surprised if your employer is quick to kick you out after your notice either, as some companies with secrets may want to cut ties as quickly as possible.
9. Side Hustles
Many companies do not allow you to moonlight in another job, or some may just stop you from working jobs that compete with your existing job.
This clause could be a cause for termination, even if you’re just driving Grab in your downtime.
10. Restrictive Clauses
Though it will only apply once you leave the company, restrictive clauses that are too, well, restrictive could impact your ability to move forward in your career.
But here’s an interesting fact: Malaysian businesses will usually add a non-competition clause in your offer letter, stipulating that you can’t work for a competing company a certain amount of time after leaving your old one.
The thing is though, Malaysian law does not allow them to act on these clauses, because Section 28 of the Contracts Act 1950 prohibits any agreement that could stop a person from practicing a legal job, trade, or business of any kind.
Other clauses could still choke you though, like clauses preventing you from poaching clients, divulging any manufacturing secrets, or any secrets of the trade. Skills however, can and should be applied in a different company.
11. Retirement Age
Different companies will stipulate different retirement ages, so don’t be surprised if yours is either much earlier or much later than the normal.
- Now that you’ve signed that offer letter, here’s a handy guide to surviving the probation period.