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The job offer letter is a formal document sent to candidate selected for employment. It is a good idea to have a written confirmation of an employment offer so that both employer and employee are clear on the terms and conditions of a job to be done.
A candidate may choose to accept the job offer by signing and returning the letter as a formal acceptance of the position for employment. If the offer is not for the compensation package that was expected a candidate must decide whether to make a counter offer or declined the job invitation.
A job offer is a written documents which binds employer and employee in a legal boundary. In this document it is made clear to both as what is expected from each other up to what extent in written of something in cash or kind person activity to be done or not to be done in a certain manner. Hence, it serves as a legal guideline for both the parties avoiding any legal dispute which can harm industrial piece.
There is always a room for negotiation in a job offer, because, some items may be there in a job offer which might not be acceptable to the candidate, so evaluating of a job offer thoroughly is important considering the compensation package, perks and benefits, working conditions, leave policy, feasible targets, etc and then negotiate if necessary. If one can feel that compensation offered could have been more competitive as per the relevant qualification and experience then a candidate can negotiate an offer.
On the contrary a candidate can also go for a counter offer but for that to happen one should have a clear reason backed by a proper research. Make sure, candidate research before negotiating or making a counter offer.