Access to social and financial resources is vital to every adult. When you want to move houses, for example, you have to scout for apartments within your pay range; when applying for a loan, you have to take one that you can afford to pay. Moreover, to avoid fraudulent individuals and potential defaulters, most institutions require proof of employment to check whether their income can sustain payment. The proof is provided in the form of an employment verification letter.
This article discusses an employment verification letter and the reasons for requesting one. Employment verification letters also differ from other types like background checks, what to include in one, and what to consider before requesting one.
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Given below are employment verification letter templates:
What is an Employment Verification Letter?
An employment verification letter is a document from your employer acknowledging that you are or have been under the employment of the employer.
The verification letter often notes the length of time you worked for the employer and provides contact information for the company’s human resource department. Verification letters should be a brief acknowledgment of employment; as such, they should be short and to the point.
The verification request may be for information on the dates of employment, salary, whether you are employed or eligible for re-employment, and where the employee was terminated, the reason for termination. In addition, various institutions may request a verification letter, landlords, for example, may ask for one to verify whether a potential tenant can pay rent, and banks may ask for one before giving a loan. Finally, the verification letter confirms that the person is financially secure.
Alternative names
Employment verification letters are sometimes called:
- letters of employment
- proof of work.
Reasons for Requesting an Employment Verification Letter
There are many reasons why a verification letter is needed. Institutions, companies, and rental agents may request an employment verification letter in the following circumstances:
You want to buy a new house
Most people take loans when thinking of buying a house. Most banks require verification letters to confirm that you’re financially secure and can keep up with future payments. The employment verification letter acts like some security.
When you need to adjust the terms of the loan
When considering the possibility of adjusting the terms of your loan, banks require an employment verification letter to check whether you qualify for the adjustment. Banks will often revise the terms if you are in an excellent financial position or where you earn higher pay or have been promoted.
You’ve applied for a job
When applying for a job, most people with work experience indicate their previous places of employment. Some employers may require a verification letter to confirm whether the applicant worked at the stated locations. Verification is often done to avoid fraud.
Want to rent a home or apartment
Some rental agents require verification letters to ensure you can pay rent on time. The verification letter clarifies the tenant’s financial position and whether or not they can comfortably make the monthly payments.
Employment Verification Letter Vs.
The employment verification letter acknowledges that an individual is or has worked for an employer. It is different from the following:
Background check
A background check verifies an individual’s personal information, including their current and previous addresses and places of employment, unlike the employment verification letter, which only confirms the individual’s employment details.
SSN verification
The social security number is not included in an employment verification letter because it is sensitive personal information. If an employer must verify an individual’s social security number, they are advised to contact eVerify or the Social Security Administration.
References
Employment verification letters contain factual information about a person’s past or current employment, salaries, and duration of work. On the other hand, references are written by the employee’s former colleagues, peers, or employers. In addition, reference letters talk about the employee’s character.
Pre-Considerations
Employment verification letters are important because they determine an individual’s living situation, finances, and even jobs. As such, before requesting a verification letter, an individual needs to consider the following:
Find the right person in the company
The right person to prepare your employment verification letter is often the person that handles employee requests. In big companies, the human resources department handles such requests; in small companies, employees often request their employers, supervisors, or payroll managers.
Follow the employer’s procedure
Most companies have procedures for requesting employment verification letters. Find out the steps to take to get your employment verification letter. For example, some companies may require you to fill out a form or send an email or a letter to the employer.
What to Include in an Employment Verification Letter
When preparing an employment verification letter, you need to have all the information necessary to allow the recipient of the letter to verify the information. The following must be included:
Employer’s information
The requesting individual’s employer sends the employment verification letter. The employer’s information must be included beginning with their legal name and followed by their address, city, state, and zip code.
Date
The date when the verification letter was made would show the recipient when it was prepared. The date should be written following the day/month/year format.
Employee’s information
The verification letter is meant to confirm an employee’s employment status; the employee’s details must be included. The name stated should be the employee’s full legal name.
Start date of employment
The employer should provide the calendar date the employee started working for the company. The start date is important for potential employers because it allows them to confirm the details on the employee’s resume.
Job title or position
The employee’s job title should be included in the verification letter. For clarity, the employer should indicate the employee’s current position, for a previous employer, and the role the employee last held.
Job-status
The employee’s job status is crucial because it allows the recipient of the verification letter to determine the possible benefits to which the employee is entitled. For example, the employee may be ‘part-time’ or ‘full-time.’ Full-time employees often have more employment benefits.
Supporting information
Supporting information is added to clarify the employee’s job status. For example, the verification letter should include the employee’s hours of service per week or month to define whether the employee is full-time or part-time.
Employee’s earnings
The employer should state how much the employee earns as it is one of the considerations for the recipient. Therefore, employers should declare the employee’s earnings; if the employee is paid hourly, weekly or monthly, the same should be noted, and the amount should be in dollars.
Bonus
The verification letter should contain a statement on whether the employee is entitled to a bonus. If the employee earns a bonus, the amount should be indicated.
Employer’s signature
At the end of the letter, the employer should append their signature to acknowledge its contents as accurate. Where the employer cannot sign, authorized personnel may sign the document.
What Not to Include?
Employers must be cautious about the information when preparing verification letters to avoid disclosing confidential information to third parties. Therefore, employers should only provide the information requested. If details like the employee’s salary are needed, the employee should sign a consent form authorizing the release of the data.
In addition to salary, employers should not release the following information without signed consent:
- Financial information, unless the employee requests that it can be released.
- Protected information like health or marital status.
- Personal information like previous convictions.
- Reasons why the employee may be unsuitable.
Employment Verification Letter Template
[Employer’s Name]
Address]
City]
[State, zip code.]
Date]
[Receiver’s Name]
Address]
City]
[State, zip code.]
Dear Sir/Madam,
This letter shows that [Employee’s name] is employed by our company and is currently an employee in good standing. Employee’s name] was hired on [date] as [job title] at an annual salary of [provide the dollar amount]. He is a full-time employee and works a regular 40-hour work week. The typical starting and ending times for employee’s name] are [clocking in and out time] Monday to Friday. He is paid and provided benefits consistent with other employees in the same position.
I have attached [employee’s name] pay stubs from the month of [month] to provide a detailed account of his earnings. In addition, his Tax Returns for [period] have also been provided for review.
Should you need any further information regarding [employee’s name] employment, please contact me at [Official email] or [ mobile phone number].
Sincerely,
Employer’s name]
Signature
Employment Verification Letter Sample
Loud Inc.
678, Sixth Street,
Cordova, Ms 27968
June 15, 2022
Meum Bank Ltd.
123 Deer Street
Hermie, Ag 45124
To whom it may concern,
Please accept this as a confirmation that Dylan Whitmore is an employee at Loud Inc. He began his employment at our organization in January 2016 as the Sales Manager and currently holds the same position. Dylan is a full-time employee earning a current salary of $ 90,000.
I’m sharing the following supporting documents as proof of income for you; pay stubs and tax returns for the last year. All the information provided is to the best of my knowledge.
Should you require further information, contact me at 255-5515 or [email protected].
Sincerely,
Faith Tempest
Human Resource Manager
Tips for You
An employment verification letter should be simple and factual. The following are tips to consider when preparing it:
Be specific
When requesting an employment verification letter, be as specific as possible to ensure you provide all the details needed by the person requesting the letter.
Give plenty of time
The employee should request the letter as early as possible to give the employer time to prepare. Make sure there is enough time before the deadline if there is one.
Follow business letter format
The verification letter should be written in business letter format, which follows the order, sender’s contact information, date, recipient’s contact information, salutation, body, conclusion, and signature.
Keep it concise
Employment verification letters should be concise. The employer should only give the requested information.
Provide your contact information
The employer should include their contact information at the end of the letter. The data is essential should the recipient need further clarification from the employer.
Edit and proofread
Since the verification letter is essential to the employee, the information provided should be accurate. Therefore, the employer should ensure they proofread and edit the letter before sending it to the recipient.
What Other Supporting Documents to Attach?
When preparing the employment verification letter, some documents must be attached to verify the letter’s contents. They include:
Past pay status
Include the employee’s pay stubs for the last two years. Where the employer cannot access them, they may attach the employee’s previous two years’ bank statements. The pay stubs allow the recipient of the letter to understand the employee’s spending habits.
Past two years of tax return
Self-employed people may need to provide their tax returns for the last two years. Tax returns allow the recipient to see whether the employee has been tax compliant. Individuals may request IRS Form W-2, and self-employed people may request IRS Form 1040 or IRS Form 4506-T, a request to the federal government to verify the individual’s income for the past year.
Credit report
Where you cannot get the pay stubs or tax returns, you may request the individual to fill out a Background Check Authorization Form which gives all the information needed to conduct a background check.
Things to Watch Out
A request for an employment verification letter may sometimes require you to give confidential information or information that otherwise shouldn’t be available to the public. The nature of such information may expose the employer to liability; as such, there are things you need to watch out for when writing an employment verification letter:
- When a new employee requires a verification letter yet they have not started working for you, you should give them their official job offer letter instead. The official job offer letter is better because you may be unable to provide the details often requested in the verification letter.
- Where an organization requires you to fill out a form instead of preparing a verification letter, you should fill out the form and append your signature at the bottom.
- When you are requested to give out the employee’s personal information like marital status, you should indicate that you ‘decline to answer because that would violate your employee’s rights.
- Where an employee needs you to sign a verification letter, you should read through it before signing and be sure that you agree with its contents. It would be best if you also had the employee sign the letter before you sign it and keep a copy of the same.
- Where the employee has never worked for you, you should respond by stating that the individual has never been your employee.
Frequently Asked Questions
Can a previous employer deny an employment verification letter?
Yes, a previous employer can deny an employment verification letter. However, they are not legally required to verify your employment.
When must an employer respond to verification of employment?
Employers should respond to a verification of employment where a federal institution makes a request or is a legal requirement by the local state law.
What do you say when verifying employment?
An employment verification letter contains an acknowledgment that the employee worked for them. In addition, it should state when the employee began working for them, their position, and their salary (if requested).