Side letter
Side letter. A separate agreement that changes or adds to your contract.
What it is
A side letter is a separate document that changes or adds to your contract. Typical examples are a guaranteed first-year bonus, a sign-on award to replace what you lost by leaving your last employer, relocation support, extra notice, or a promise about your role or reporting line.
Why it matters at exit
Side letters are easy to lose sight of. They are often signed by someone who has since left, filed separately from the contract, and forgotten by HR. At exit, they can be worth a great deal.
Two questions come up again and again:
- Is it binding? A letter signed by someone with authority, with clear terms, usually is. A promise in an email or an offer letter may be too, depending on its wording.
- Does it survive? A later contract, an “entire agreement” clause, or a group policy may be said to have replaced it.
What to do
Find every document that sets your terms: offer letter, contract, side letters, award letters, and any emails that changed them. Read them together. If you are about to join a business, ask for promises to be put in the contract itself or in a side letter that the contract expressly preserves.