Letter of Intent vs. Employment Contract for Physicians

a physician receives a contract or a letter of intent LOI during their interview process for a job offer

When it comes to pursuing a physician position, understanding the nuanced differences between a Letter of Intent (LOI) and an Employment Contract is crucial. While both documents play a role in securing your future job, they serve distinct purposes and come into play at different stages of the hiring process.   

Purpose and Timing: 

An LOI is typically used at the early stages of the hiring process. It’s a non-binding document that outlines your intention to join a particular medical institution. The LOI signals your serious interest in the position and initiates negotiations. Employment Contract: The Employment Contract, on the other hand, is a legally binding agreement that solidifies the terms and conditions of your employment. It is the final, comprehensive document that specifies your role, responsibilities, compensation, and benefits in detail. 

Binding vs. Non-Binding:  

As mentioned, an LOI is non-binding. This means that, while it expresses your intention to work for the organization, it doesn’t legally obligate you to take the job. It serves as a precursor to the formal agreement and allows room for further negotiations. Employment Contract: An Employment Contract is legally binding once signed by both parties. It outlines the obligations and responsibilities of both the physician and the employer, creating a legal commitment to the terms stipulated. 

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Specificity of Terms: 

An LOI is typically more general in terms of content. It may highlight key aspects of the job, such as the title, basic salary, and work location, but it doesn’t delve into the finer details of the agreement. The Employment Contract is highly specific and detailed. It covers all aspects of the employment relationship, including compensation, benefits, work hours, responsibilities, termination conditions, and any restrictive covenants. 


The LOI is a starting point for negotiations. It sets the stage for discussions between you and the employer, allowing both parties to refine the terms before finalizing the contract. Once the Employment Contract is signed, it becomes legally binding, making it more challenging to renegotiate the terms without the agreement of both parties. Negotiations primarily occur before reaching this stage. 

Formality and Legal Review: 

While the LOI is an important document, it tends to be less formal and is often not subject to extensive legal review. It serves as an initial expression of interest and intent. Employment Contracts are formal, legally binding documents. It is essential to have an attorney review the contract to ensure that it adheres to legal standards and protects your interests. Not ready to move forward with signing a job offer? Make sure you review how you can delicately decline an employment offer.


In the physician’s journey to secure a new position, the Letter of Intent and Employment Contract serve distinct yet complementary roles. The LOI signifies your interest and initiates negotiations, while the Employment Contract is the legally binding document that outlines the detailed terms of your employment. Understanding the differences and when each document comes into play is vital for ensuring a smooth and informed transition into your new medical role. 


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