The labour codes made the appointment letter mandatory. Most small-business letters are a salary number and a start date. Here are the twelve clauses that make the letter do its job in the two moments it matters: a dispute and an exit.
Under the labour codes in force since 21 November 2025, every employer must issue a written appointment letter to every employee, in the form the rules prescribe. Beyond compliance, the letter is the contract that every later question runs back to: what the notice period is and how shortfall is recovered, whether the salary quoted is CTC or gross, what probation means, whether outside work is allowed, which policies bind. The template below has twelve clauses. Each is followed by why it is there and the mistake that makes it useless. Adapt the numbers, attach the salary annexure, issue it before day one, and keep the signed copy where you can find it in three years. Facts checked 14 October 2026; the central and state rules prescribe a format with minimum particulars — make sure your letter contains at least those.
| Component | Monthly | Annual |
|---|---|---|
| Basic (≥ 50% of total remuneration) | ₹ | ₹ |
| House rent allowance | ₹ | ₹ |
| Other allowance | ₹ | ₹ |
| Gross | ₹ | ₹ |
| Employer PF (if applicable) | ₹ | ₹ |
| CTC | ₹ | ₹ |
| Deductions: employee PF, professional tax, TDS as applicable | Net pay = gross − deductions | |
State plainly which figure the offer quoted. The single most common first-month dispute is an employee who was told "₹40,000" and received ₹34,000 net; the annexure prevents it. See what the payslip will then show.
Issue one now, dated now, stating the original date of joining and that it records the existing terms. Do not use the exercise to change terms adversely without agreement — that is a variation, not a record. For employees whose structures need the 50% correction, issue the revised annexure with an effective date and the arrears treatment if any.
Issue before the joining date, get it signed (an e-signature or a signed scan is fine), store it against the employee record, and give the employee a copy they can access later. Attach or link the policies it references, and keep the policy versions — the letter binds the version in force at the time unless amendments are communicated. The onboarding checklist has the letter as the first item before day one.
| Status | Mandatory for every employee under the labour codes (in force 21 November 2025) |
|---|---|
| Clauses | Twelve: parties, nature and date, probation, remuneration, hours, leave, notice, conduct, confidentiality and IP, property and data, verification, general |
| Salary structure | Basic (plus DA) at least 50% of total remuneration; gross and CTC both stated |
| Notice | Symmetrical: period, basis, recovery of shortfall, pay in lieu on the same basis |
| Probation | Length, extension once in writing, confirmation by letter, notice during probation |
| Not to include | Post-employment non-compete (generally unenforceable); blanket outside-work ban |
| Existing staff | Issue a letter recording existing terms; changes require agreement |
Yes. The labour codes in force since 21 November 2025 require every employer to issue a written appointment letter to every employee, in the form prescribed by the rules, containing at least the specified particulars. Existing employees without a letter should be issued one recording their current terms.
An offer letter proposes employment and its headline terms, and lapses if not accepted. The appointment letter is the contract issued on or before joining, with the full terms — probation, hours, leave, notice, conduct, confidentiality — and the salary annexure. Many small businesses issue only the first; the second is the one that is mandatory and that governs disputes.
Each component monthly and annually — basic (at least 50% of total remuneration under the labour codes), HRA, other allowances — the gross, employer contributions, the CTC, and a note of the deductions that will apply. State clearly whether the figure in the offer was gross or CTC.
State the notice period after confirmation and during probation, that either party may terminate by notice or pay in lieu, the basis for computing pay in lieu (for example gross salary on calendar days), and that any shortfall in notice served by the employee is recoverable from final dues. Use the same basis in both directions.
A restriction during employment is enforceable. A post-employment non-compete is generally unenforceable in India as a restraint of trade, and including one weakens the credibility of the letter. Confidentiality and non-solicitation obligations are the enforceable tools after exit.
If they never received one, yes — issue a letter that records their existing terms and original joining date. If their salary structure needs correcting for the 50% wages rule, issue a revised annexure with an effective date. Changes to terms require the employee's agreement; the letter records terms, it does not impose new ones.
Merik holds what the letter refers to: the employee's designation, department, reporting line, joining date, and a salary structure with basic set at half of gross by default, with CTC history as revisions happen. The attendance rules the letter references — check-in method, grace, late marks, half-days — are configured once and applied to every punch, and leave types, balances and the holiday calendar live in the leave module, so the policies the letter incorporates are the ones actually running.
Merik does not generate appointment letters. The template above is yours to adapt; the record behind it is what Merik keeps. New joiners can be added one at a time or by pasting the roster from Excel, and their login is emailed from the same screen. See the employees module.
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