Key Takeaways

  • A contract letter (or anubandh patra) formalizes agreements, ensuring clear responsibilities and expectations between parties.
  • Important sections include identifying parties, scope of work, payment terms, benefits, and termination clauses.
  • Clear, specific, and unambiguous language strengthens enforceability and reduces legal risks.
  • Including protective clauses like indemnification, confidentiality, and dispute resolution improves the robustness of the contract.
  • Negotiation and final contract review by a legal professional are highly recommended before signing.

How to Write a Contract Letter

If you want to learn how to write a contract letter, you’ll first need to understand the purpose of the letter, along with the other party involved in the contract. The contract letter represents the beginning stages of an official employment relationship between a business and an employee. Therefore, it is important to draft a detailed and thorough contract letter so that the new employee is fully aware of his or her obligations and duties.

The contract letter should specify the responsibilities of both parties to prevent potential legal disputes from arising. For example, the contract letter should not leave any room for negotiation, as the new employee should be able to read the contract and fully understand his or her rights. The negotiations should take place before the contract letter is drafted, and any ambiguous terms should be discussed prior to this letter, too.

Another example of when you might want to write a contract letter is for a home improvement project. For example, if you are hiring a contractor to complete a project in your home, you can draft this letter, which will provide information on the scope of the work, length of time, costs, and materials associated with the project. Ensure that both you and the contractor sign the document, as it will then become a legally binding document.

Understand the Purpose and Legal Basics

When writing a contract letter, or anubandh patra, it’s critical to understand that it’s not just a formal communication—it creates a legally binding agreement​. A contract can apply to various situations: employment agreements, freelance contracts, home renovation projects, lease agreements, and more​.

The essential elements of any valid contract include:

  • Offer and acceptance: One party makes an offer, and the other accepts it.
  • Consideration: There must be something of value exchanged.
  • Capacity: All parties must have the legal ability to enter into a contract.
  • Intention: All parties must intend to create a binding agreement.

A strong anubandh patra sets clear expectations from the start and avoids future disputes by documenting agreed-upon rights and obligations​​.

What to Include in a Contract Letter

There are several elements that should be included in a contract letter, including the following:

  1. Position title
  2. Company name
  3. Starting date
  4. Employee’s status as a full-time, part-time, or contractor employee
  5. Whether the employee will be exempt or non-exempt
  6. Amount of pay
  7. When the employee will be paid (bi-weekly, weekly, etc.)
  8. Company benefits
  9. Paid time off information
  10. Organizational structure
  11. Probationary period information, if applicable
  12. Conditions of employment, if any
  13. Unambiguous language stating that the employee is entering into an at-will contract, if applicable

You’ll want to be clear as to whether the employee will be a full-time or part-time employee, while also providing information as to how many hours per week the employee should work, particularly for part-time employees.

The base salary is also another key component to include in the contract letter, as this could be different if you hire a non-exempt employee. Also ensure that you are clear as to how many PTO days the employee has, and include whether or not the employee will be off from work on certain holidays.

The company benefits section should entail all benefits being offered to the employee, including such benefits that won’t be offered until the employee has worked for your company for a certain period of time. This can include 401k investing, commuting reimbursement, internal and external training, etc.

Additional Essential Elements to Include

In addition to basic employment or project details, a robust contract letter or anubandh patra should also cover the following elements​:

  • Identification of Parties: Full legal names, addresses, and contact information.
  • Effective Date and Duration: When the agreement starts and, if applicable, when it ends.
  • Scope of Work or Duties: Detailed description of services or tasks, with clear deliverables and timelines​.
  • Payment Details: Specify total compensation, payment schedule, acceptable payment methods, and consequences for late payments.
  • Confidentiality Clauses: Define what information must remain private, especially for sensitive projects.
  • Dispute Resolution Terms: Outline how any disagreements will be handled (e.g., mediation, arbitration).
  • Termination Conditions: Define how either party may end the contract and under what circumstances.
  • Force Majeure Clause: State what happens if unexpected events (like natural disasters) prevent either party from fulfilling obligations​.

Using clear, simple language throughout will help ensure both sides fully understand the agreement​​.

Guidelines for Letter of Agreement

There is no specific format in which the letter must be arranged. But there are some helpful guidelines that can assist you when you are ready to draft the contract letter. For example, it might be a good idea to first identify the nature of the project. Assuming you are drafting a contract letter not for an employment contract (business-employee) but rather as a homeowner hiring a contractor to engage in a home renovation. You’ll want to identify the nature of the overall project, which can include what you expect from the contractor, how you want the place to look after the project is over, and what type of materials you want to be used.

Next, you should identify the type of product that you expect to be delivered. This could include photographs of how you want the home to look, i.e., kitchen or bathroom remodeling.

You’ll also want to include the length of time and costs associated with the project. For example, when do you want the work to be completed? How many hours will the contractor be required to work on the project? Do you want him or her to come on the weekends? What happens if the project takes longer than expected? What happens if more materials are required? All of this information should be detailed in the contract letter.

Moreover, how payment will be made is also noteworthy. For example, do you want the contractor to accept payment in cash, credit card, or check? Before detailing how you want to pay, you should speak to the contractor, as he or she might have certain conditions for payment. Some contracting companies require that you submit a check, and simply do not allow payment via credit card. This is particularly true for small businesses.

Best Practices for Drafting a Strong Anubandh Patra

Following a few key best practices can make your anubandh patra stronger and easier to enforce​​:

Do:

  • Start with a clear structure: Use short sections, bullet points, and consistent formatting.
  • Use straightforward language: Avoid overly technical or legal jargon where possible.
  • Set realistic expectations: Be honest about timelines, budgets, and deliverables​.
  • Include relevant future-proof clauses: Like amendment procedures and dispute resolution frameworks.

Don't:

  • Avoid making the contract one-sided: Contracts that heavily favor one party are harder to enforce and discourage collaboration.
  • Don’t leave ambiguous terms: Clearly define responsibilities and deadlines.
  • Don’t overload the contract: Focus on what's necessary for the relationship without adding excessive, irrelevant clauses.

Also, although templates can be a helpful starting point, be sure to customize them to fit your unique situation​.

Finally, before signing, it's highly recommended to have a legal professional review the contract. Even small mistakes can have costly consequences later​.

Frequently Asked Questions

  1. What is an anubandh patra?
    An anubandh patra is a formal contract letter in Hindi that outlines the terms, duties, and obligations between two or more parties.
  2. What is the difference between a contract letter and a full contract?
    A contract letter summarizes key terms and serves as a formal agreement, while a full contract may contain more detailed provisions and appendices.
  3. Can I write my own anubandh patra without a lawyer?
    Yes, you can draft your own anubandh patra, but it’s advisable to have it reviewed by a lawyer to avoid legal loopholes or ambiguities.
  4. What happens if a contract letter has vague language?
    Vague terms can lead to misunderstandings, disputes, and even make the contract unenforceable in court.
  5. Is a verbal agreement legally binding?
    While some verbal agreements are legally enforceable, having a written contract like an anubandh patra provides much stronger evidence of the agreement.

If you need help writing a contract letter, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5-percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law, and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.